This is the Anti-Money Laundering and Counter-Terrorist Financing Policy (the “AML/CTF Policy”) of SP NEOTERIC TECHNOLOGY LTD, a company incorporated in Cyprus with company registration number HE409435and its registered address at 5 FiliouTsigaridi, Office 301, Latsia 2235, Nicosia, Cyprus (“Paze.eu”). In order to maintain uncompromised and reputable provision of services, Paze.eu is set to follow strict rules on anti-money laundering and counter-terrorist financing, governed by the local and international laws and regulations. Paze.eu thus implements this AML/CTF Policy in accordance with:
Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, and amending Directives 2009/138/EC and 2013/36/EU;
U.S. Currency and Foreign Transactions Reporting Act;
the UK and EU Wire Transfer Regulations;
the Criminal Finances Act 2017 (CFA 2017);
the Sanctions and Anti-money Laundering Act 2018 (SAMLA 2018);
the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO);
the Drug Trafficking (Recovery of Proceeds) Ordinance (DTROP);
the Organized and Serious Crimes Ordinance (OSCO);
the United Nations (Anti-Terrorism Measures) Ordinance (UNATMO);
the United Nations Sanctions Ordinance (UNSO);
the Weapons of Mass Destruction (Control of Provision of Services) Ordinance (WMD(CPS)O).
Proceeds of Crime Act 2002 (POCA) (as amended by the Serious Organised Crime and Police Act 2005 (SOCPA));
the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017) and the Terrorism Act 2000 (TA 2000) (as amended by the Anti-Terrorism, Crime and Security Act 2001 (ATCSA 2001) and the Terrorism Act 2006 (TA 2006))
FCA guidance;
any other applicable laws of the Republic of Cyprus.
This AML/CTF Policy, which is a part of the Terms of Service of Paze.eu, requires mandatory compliance by the User. Users are required to read, review, understand and then agree to the terms hereinafter before using or availing any of the Paze.eu Services.
Terms not defined herein shall carry the same interpretation as in the Terms of Service and in the absence thereof to general usage and understanding.
“Ultimate Beneficial Owner” means:
(i) The natural person who has direct or indirect ownership of over 25% (twenty five per cent) of the shares of a legal entity, where indirectly means that the natural person has ownership in another legal entity which owns fully or partially the legal entity subject to verification;
(ii) The natural person is entitled to over 25% (twenty five per cent) of the profits;
(iii) The natural person has the power, directly or indirectly, to appoint or elect more than half of the members of the managing or supervising body and is also a shareholder;
(iv) The natural person holds more than 50% the voting rights in the legal entity;
(v) The natural person has the right to influence the legal entity as a result of an agreement or of the articles of association of the entity; or
“Identification Document(s)” refers to:
(i) National ID Cards and Passports and any other government-issued identification document;
(ii) Documents that identify the registered address of a natural person or legal entity such as, but not limited to, Bank Statement and Utility Bill; or
(iii) Such other document as may be notified by Paze.eu from time to time;
"Money Laundering” refers to the concealment or the engagement in acts designed to conceal or disguise the true origins of illegally obtained money, so that the unlawful proceeds appear to have been derived from legitimate origins or constitute legitimate assets.:
“Politically Exposed Person” refers to any natural person that is himself or is a family member or close associate to a natural person that is:
(i)Head of state, head of government, minister, and deputy or assistant minister;
(ii) Member of parliament or similar legislative bodies;
(iii) Member of the governing bodies of political parties;
(iv) Member of supreme courts, of constitutional courts or of other high-level judicial bodies, the decisions of which are not subject to further appeal, except in exceptional circumstances;
(v) Member of courts of auditors or of the boards of central banks;
(vi) Ambassador, charges d’affaires and high-ranking officer in the armed forces;
(vii) Member of the administrative, management or supervisory bodies of State-owned enterprises;
(viii) Director, deputy director or member of the board or equivalent function of an international organization.
“Sanction Lists” refers to lists of natural persons, legal entities and whole countries which are involved, or suspected of being involved, in illegal and criminal activities. Such lists are for example provided by OFAC, EU, UN, HMT.
“Suspicious Transactions” refers to the following activities, whether attempted or executed:
(i) Terrorist financing: transactions which to a person acting in good faith appear to be any funds collected to be used, in full or in part, by any terrorist or related organization, or in order to carry out any of the activities relating to terrorism, or terrorist acts; or
(ii) Unusually Complex: transactions which to a person acting in good faith appear to have been structured in a manner of unusual or unjustified complexity; or
(iii) Malafide Purpose: transactions which to a person acting in good faith appear to have not been transacted for bonafide purpose or have a sound economic rationale; or
(iv) Money Laundering: transactions which to a person acting in good faith appear to “clean” criminal proceeds so that their illegal origins are hidden. Such proceeds are usually associated with the types of organised crime that generate huge profits in cash, such as trafficking in drugs, weapons and human beings as well as fraud.
Banks, investment companies, money transfer companies, stock exchange companies, accountants, casinos and other financial service providers have to comply with AML and CFT regulations in Cyprus. These entities are responsible for performing certain AML and KYC controls during customer onboarding and monitoring processes and during customer transactions. Companies should determine the customer risk level with Customer Due Diligence controls. Under AML laws in Cyprus, organizations are required to notify MOKAS of suspicious situations during controls. Organizations that do not comply with AML regulations are fined by the Government of Cyprus and the European Union.
Being a Cyprus technology company that enables businesses to effectively manage their payments accounts opened worldwide, Paze.eu performs the necessary due diligence in its business relationships, ensuring that Third-Party Providers are regulated and licensed to offer the payment solutions offered through Paze.eu’s platform.Paze.eu fully complies with all applicable regulations and cooperates with financial regulators in various jurisdictions (in particular, but not exclusively, with the Financial Crimes Enforcement Network (FinCEN), United States Treasury Department, U.S. Securities and Exchange Commission, Financial Conduct Authority, the Financial and Capital Markets Commission (FKTK), the Bank of Lithuania, the Hong Kong Monetary Authority (HKMA), Cyprus Securities and Exchange Commission).
Paze.eu is always set to follow the most stringent rules and industry standards in any country it might have operations with the intention to prevent any kind of illegal and criminal activities and any potential involvement of Paze.eu in such.
Paze.eu is prohibited from transacting with individuals, companies and countries that are on prescribed sanctions lists and thus screens its users against United Nations, European Union, UK Treasury and US Office of Foreign Assets Control (OFAC) and other sanctions lists.Paze.eu uses the following sanctions and high risk jurisdictions lists:
In order to identify politically exposed persons amongst its Users, Paze.eu does not only rely on user-supplied declarations but also screens all individual account holders, all UBOs of corporate account holders as well as any person that has access to a corporate account against various domestic and international PEP lists.
Based on the provided information, Paze.eu reserves the right to determine, at its sole discretion, the appropriate verification level for any user, as well as the right to downgrade or ban users without prior notice. If Paze.eu finds out that any User information, obtained in accordance with the described procedure, to be inadequate, insufficient, or enlisted on the Sanctions Lists, the Paze.eu may in its discretion either refuse or terminate (as the case may be) the registration of such User Account or require verification of such User’s Identification Documents again.
In the event that it is brought to the attention of Paze.eu, that a particular User or account is maintained under a fictitious name, Paze.eu has the full right and authority to terminate and close such an account with immediate effect and without prior notice to the User.
Paze.eu also reserves the right to verify user’s identity on an ongoing basis, especially in cases of unusual and suspicious activity or if Paze.eu doubts the adequacy or veracity of previously obtained customer identification data. Paze.eu is further in its right to request up-to-date documents from the users, even though they have already passed identity verification in the past.
Paze.eu may also implement policies restricting Verification Levels by nationality, country of residence, or any other factor. This may affect the user ability to deposit/withdraw funds based on their verification level and Paze.eu cannot be held responsible for any potential losses.
Paze.eu reserves the right to terminate the User Account, restrict and/or prevent access to its online platform, or report to the appropriate enforcement authorities the activities of any User if there are suspicions on illegal activity.
Once the User’s identity has been verified, Paze.eu is able to remove itself from potential legal liability in a situation where its Services are used to conduct illegal activity.
The sensitive personal information is collected, shared and stored safely in accordance with Paze.eu’ Privacy Policy.
Paze.eu is devoted to following highest industry standards and thus takes a risk-based approach in terms of committing its resources in the most efficient way; meaning that the greatest risks would receive the highest attention. As a result, Paze.eu also reserves the right to classify its Users into different risk profiles based on the following factors (including without limitation):
(i) Sufficiency and adequacy of identification information;
(ii) Nature of User’s business/vocational activities; or
(iii) Guidance notes circulated by various governmental and inter-governmental organizations.
Business relationships with corporate account holders, which have a complex ownership structure, preventing the identification of the Ultimate Beneficial Owners, and natural persons with a nationality or residency at high-risk third countries are for example a top priority for the compliance office of Paze.eu.
Paze.eu keeps the risk categorization confidential and can change the categorization of any User at any time given various factors. While the Users are not entitled in any way to seek disclosure, Paze.eu may disclose the User’s risk categorization data to the competent enforcement authority if it finds that a particular User has executed or is likely to execute any Suspicious Transaction.
The risk is divided to 3 levels:
“1. Normal”
The risk level is normal, there are no high-risk characteristics present.
“2. High 1”
(i) User is from high risk country.
(ii) User is local PEP or a person. associated with a PEP.
(iii) The legal person’s area of activity is associated with enhanced money-laundering risk.
(iv) The legal person is situated in a country, which is listed in the list of risk countries.
(v) The legal persons activities and liability are insufficiently regulated by law, and the legality of financing of which is not easy to screen.
(vi) The representative or the Beneficial Owner / Shareholder of a legal person is a local PEP or his / her family member.
“3. High 2”
(i) User is suspected to be or to have been linked with a financial offence or other suspicious activities.
(ii) User is a non-resident individual, whose place of residence or activities is in a country, which is listed in the list of risk countries.
(iii) The representative or the Beneficial Owner / Shareholders of a legal person is a PEP or his or her family member
(iv) There is information that legal person is suspected to be or to have been linked with a financial offence or other suspicious activities
(v) A legal person registered outside the European Economic Area, whose field of business is associated with a high risk of Money Laundering, or registered in a low tax rate country.
9.1.Risk by Users
Suspicious facts such as but not limited to the: discrepancies in provided id documents, fictitious person, stolen identity, counterfeited id document, post box home address, pervious financial crime record, terrorist record, wanted person, no contact phone number, not valid documents, discrepancies in provided documents for the legal person, etc.
Politically exposed persons such as but not limited to the prominent public functions (head of state, head of government, minister and deputy or assistant minister; a member of parliament or of a similar legislative body, a member of a governing body of a political party, judges or national bank officials; an ambassador, a chargé d’affaires and a high-ranking officer in the armed forces; a member of an administrative, management or supervisory body of a state-owned enterprise; a director, deputy director and member of the board or equivalent function of an international organization, except middle-ranking or more junior officials).
9.2. Risk by countries
1. Resident / Citizen of the High-Risk Countries such as but not limited to:Afghanistan, Algeria, American Samoa, Bahrain, Bangladesh, Bolivia, Democratic Republic of Congo, Democratic People’s Republic of Korea (DPRK), Ecuador, Ethiopia, Iran, Iraq, Kyrgyzstan, Morocco, Nepal, Pakistan, Palestine, Qatar, Syria, Sudan, Trinidad & Tobago, Yemen, Zambia.
2. Low Tax or Tax-free Countries such as but not limited to: United Arab Emirates, Oman, Bahrain, Saudi Arabia, Kuwait, Bermuda, Cayman Islands, the Bahamas, Brunei, Vanuatu, Anguilla, Belize, Costa Rica, Guatemala, Panamá, Nicaragua.
9.3.Risk by transactions
Paze.eu shall inspect any outstanding transaction, which include but is not limited to the: large transactions that do not correspond to user’s source of funds and/or source of wealth, transactions to offshore or shell bank (financial institution that does not have a physical presence in any country), executing payment via non-licensed payment institution, large daily movements of fiat or virtual money, etc.
Paze.eu requires its officers, employees, and affiliates to adhere to the strictest compliance standards in preventing the use of its products and services for the purposes of money laundering and counter-terrorist financing.
Each employee of Paze.eu, whose duties are associated with the provision of products and services of Paze.eu and who directly or indirectly deals with the clients of Paze.eu, is expected to know the requirements of the applicable laws and regulations which affect his or her job responsibilities, and it shall be the affirmative duty of such employee to carry out these responsibilities at all times in a manner that complies with the requirements of the relevant laws and regulations.
Each of the affiliates of the Paze.eu is required to comply with AML and KYC policies. All identification documents and services records shall be kept for the minimum period of time required by local law.
All new employees receive anti money laundering training as part of the mandatory new-hire training program. All applicable employees are also required to complete AML and KYC training annually. Participation in additional targeted training programs is required for all employees with day-to-day AML and KYC responsibilities.
Paze.eu shall diligently monitor transactions for suspicious activity. Transactions that are unusual will be carefully reviewed to determine if it appears that they make no apparent sense or appear to be for an unlawful purpose.
Implemented internal controls will serve as ongoing monitoring system in order to detect the suspicious activity or transaction. When such suspicious activity is detected, Paze.eu shall determine whether a filing with any law enforcement authority is necessary. Suspicious activity can include more than just suspected money laundering attempts. Activity may be suspicious, and Paze.eu may wish to make a filing with a law enforcement authority, even if no money is lost as a result of the transaction.
Paze.eu shall initially make the decision of whether a transaction is potentially suspicious. Once Paze.eu has finished the review of the transaction details, he or she will consult with its management to make the decision as to whether the transaction meets the definition of suspicious transaction or activity and whether any filings with law enforcement authorities should be filed. Paze.eu shall maintain a copy of the filing as well as all backup documentation. The fact that a filing has been made is confidential. No one, other than those involved in the investigation and reporting should be told of its existence. In no event should the parties involved in the suspicious activity be told of the filing.
In addition to verifying User identity, Paze.eu also reserves the right to monitor and analyse their activity as part of the AML/CTF toolkit. Paze.eu performs a variety of compliance-related tasks, including capturing data, filtering, record-keeping, investigation management, and reporting. System functionalities include but are not limited to:
(i) Monitoring for transactions by both artificial intelligence (using predictive algorithms, statistical analysis, classification and scoring etc.) and human intervention, which appear to be:
a. unusually and unnecessarily complex;
b. unusually large;
c. conducted in an unusual pattern;
d. lacking an apparent economic or lawful purpose.
(ii) Daily check of Users against recognized “black lists” (e.g. OFAC), as described above;
(iii) Placing Users on watch and service denial lists;
(iv) Opening cases for investigation where needed;
(v) Requesting additional information, where deemed appropriate;
(vi) Sending internal communications;
(vii) Filling out statutory reports, if applicable;
(viii) Case and document management.
Paze.eu monitors all transactions on a daily basis and it reserves the right to report any suspicious transactions to the appropriate law enforcement agencies, to request additional information and documentation in case of suspicion for illegal activities as well as to suspend or terminate the provision of services to the suspected Users. The list is not exhaustive and Paze.eu will take the necessary measures to prevent cases of money laundering, terrorist financing or any other criminal activity.
Reasonable procedures for maintaining records of the information used to verify a person’s name; address and other identifying information are required under this Policy. The following are required steps in the record keeping process:
(i) Paze.eu shall maintain a record of identifying information provided by the user.
(ii) Where Paze.eu relies upon a document to verify identity, Paze.eu shall maintain a copy of the document that the Paze.eu relied on that clearly evidences the type of document and any identifying information it may contain.
(iii) Paze.eu shall also record the methods and result of any additional measures undertaken to verify the identity of the user.
(iv) Paze.eu shall record the resolution of any discrepancy in the identifying information obtained.
(v) All transaction and identification records will be maintained for a minimum period of five years.
This AML/CTF Policy may be periodically reviewed and revised. The revised draft will be uploaded on https://paze.eu/aml and will reflect the modified date of the terms. The User is required to periodically visit the website and review terms and any changes thereto. Continued use by the User constitutes agreement with any amendments of the policy.
Should you have any questions with regard to our AML/CTF policy, please contact us at [email protected].