Legal documents

Anti-Money Laundering (AML) Policy

Policy Scope

This policy applies to all managers, employees, designated producers, and products and services provided by TradeW. All business departments and locations within TradeW will cooperate in combating money laundering activities. Each department and location has implemented risk-based procedures designed to prevent, detect, and report transactions. All efforts will be documented and retained. The Anti-Money Laundering Compliance Committee is responsible for initiating Suspicious Activity Reports (SARs) or other required reports and reporting them to the appropriate law enforcement or regulatory authorities. Any contact with law enforcement or regulatory authorities regarding this policy should be directly forwarded to the Anti-Money Laundering Compliance Committee.

The committee shall:

• Receive internal reports on money laundering (suspected money laundering).

• Investigate reports of suspicious events.

• Report relevant suspicious events to appropriate authorities.

• Ensure adequate awareness and training arrangements for employees and consultants.

• Report annually to the company's management on the operation and effectiveness of the company's systems and controls.

• Monitor the day-to-day operations of the anti-money laundering policy in relation to new product development, the acceptance of new clients, and changes in the company's business conditions.

Information from Other Sources: We may receive information about you from other sources, such as credit history information from credit agencies, which we use to help prevent and detect fraud.

Policy

TradeW is committed to preventing money laundering and any activities that facilitate money laundering or the funding of terrorism or criminal activities. TradeW is committed to complying with anti-money laundering regulations in accordance with applicable laws and requires its officers, employees, and designated producers to adhere to these standards to prevent its products and services from being used for money laundering purposes.

For the purposes of this policy, money laundering is defined as engaging in activities intended to conceal or disguise the true source of criminal proceeds to make illicit gains appear as legitimate funds or assets.

What is Money Laundering (AML)?

Money laundering (AML) is the process of exchanging criminally obtained money or other assets (criminal property) for "clean" money or other assets that do not have an apparent link to criminal sources.

Criminal property can take any form, including money or monetary equivalents, securities, tangible property, and intangible property. It also includes funds used to finance terrorism (regardless of how they were obtained).

Criminal property can take any form, including money or monetary equivalents, securities, tangible property, and intangible property. It also includes funds used to finance terrorism (regardless of how they were obtained).

Acquiring, using, or holding criminal property

Acquiring, using, or holding criminal property.

Knowingly participating in any way in criminal or terrorist property

Agreements made for money laundering or terrorist property

Investing criminal proceeds in other financial products

Investing criminal proceeds by acquiring property/assets

Transferring criminal property.

Money laundering does not have a single phase; methods vary from buying and reselling luxury items such as cars or jewelry to transferring funds through a complex network of legitimate operations. Typically, the starting point is cash, but it is important to recognize that money laundering is defined by criminal property. This can be property in any imaginable legal form, whether money, rights, real estate, or other interests; if you know or suspect that it was obtained directly or indirectly through criminal activity and do not disclose it, you are also participating in the process.

The money laundering process is divided into three stages:

• Placement: The initial proceeds from illegal activities are deposited into bank accounts, etc.

• Layering: Funds are transferred through a series of financial transactions within the system to conceal the origin of the cash, with the aim of making it appear legitimate.

• Integration: Once the funds have been removed from the system as seemingly “clean” money, criminals are free to use it.

No financial industry can be immune from criminal activities, and companies should consider the money laundering risks posed by the products and services they offer.

What is Terrorist Financing (CTF)?

Terrorist financing refers to the process by which legitimate businesses and individuals choose to provide funding for terrorist activities or organizations for ideological, political, or other reasons. Therefore, the company must ensure: (i) that the client is not a terrorist organization; (ii) that they are not providing the means to fund terrorist organizations.

Terrorist financing may not involve proceeds from criminal activities but seeks to conceal the source or intended use of funds that will then be used for criminal purposes.

Risk-Based Approach

When considering the company's internal anti-money laundering procedures, the required level of due diligence should take a risk-based approach. This means that the resources spent on due diligence for any relationship with a risk should be proportional to the level of risk that relationship presents.

These can be divided into the following aspects:

• Customer Risk: Different customer profiles present different risk levels. Basic Know Your Customer (KYC) checks can identify the risks posed by a client. For example, a retiree who regularly deposits small amounts into a savings account based on their financial details presents less risk than a middle-aged individual who makes irregular deposits into a savings account inconsistent with their profile. In the latter case, the due diligence efforts will be higher, as the potential threat of money laundering is considered greater.

• Product Risk: This is the risk posed by the product or service itself. Product risk arises from its potential use as a money laundering tool.

• Country Risk: The geographical location or business activities of the customer pose associated risks, as different countries have varying levels of risk.

The company will use these four risk areas to determine the scope of due diligence measures required initially and on an ongoing basis.

Customer Identification Program

TradeW has adopted a Customer Identification Program (CIP). TradeW will notify clients that it will seek identification information; collect certain minimum customer identification information from each client, and record such information along with the verification method and results.

Customer Notification

In accordance with applicable laws, TradeW will notify customers that it is requesting information to verify their identity.

7. How Secure is My Information?

Know Your Customer (KYC)

When establishing a business relationship, it is necessary for the company to determine the nature of business the client intends to engage in to understand what may constitute normal activity going forward.

Once a continuing business relationship is established, any unusual activity can be assessed against the client's expected pattern of activity. Unexplained activity can then be scrutinized to determine if there is any suspicion of money laundering or terrorist financing.

Financial Source

When a transaction occurs, the source of funds must always be determined, i.e., where the payment is coming from and who is making the payment, and recorded in the customer profile (this is typically achieved by retaining copies of checks or direct debit authorizations).

Identification

For individual clients, standard identification requirements depend on the client's circumstances and the type of product being traded, i.e., the product's risk level (whether low, medium, or high risk). For low-risk and medium-risk products, the following information is required as identification standards:

• The full name of the client, and

• Their address.

TradeW does not restrict the time for clients to submit verification documents, but submitting verification documents is mandatory for clients to withdraw funds.

TradeW is committed to reviewing the submitted documents within 24 hours of receipt.

Monitoring and Reporting

Transaction monitoring will be conducted within the relevant business departments of TradeW. Monitoring of specific transactions includes but is not limited to those transactions totaling $5,000 or more, and transactions where TradeW has reason to suspect suspicious activity. All reports will be documented.

Suspicious Activity

There are signs of suspicious activity that may indicate money laundering. These are often referred to as “red flags.” If red flags are identified, further due diligence will be conducted before continuing with the transaction. If a reasonable explanation cannot be found, the suspicious activity will be reported to the Anti-Money Laundering Compliance Committee.

Examples of suspicious activity or red flags include:

• Clients showing unusual concern about whether the company complies with government reporting requirements and the company’s anti-money laundering policies, especially about their identity, business type, and assets.

• Clients wishing to engage in transactions lacking business insight or an apparent investment strategy, or inconsistent with the client’s stated business strategy.

• Providing false, misleading, or incorrect information about the lawful source of funds.

Suspicious Activity Report (SAR) Submission

Regardless of the reasons, if we suspect that a client or anyone on their behalf is involved (or attempting to be involved) in any transaction related to criminal proceeds, a written report must be submitted as soon as possible.

Investigation

An investigation will begin after notifying the Anti-Money Laundering Compliance Committee to determine whether a report should be made to the appropriate law enforcement or regulatory body. Investigations will include reviewing all available information, such as payment history, birth dates, and addresses. If the investigation provides reasonable grounds, the Anti-Money Laundering Compliance Committee will recommend submitting a special investigation report to the appropriate law enforcement or regulatory body.

The results of the investigation will not be disclosed or discussed with anyone other than those with a legitimate need to know. In any case, no officer, employee, or designated agent should disclose or discuss any anti-money laundering issues, investigations, notices, or SAR documents with relevant parties or anyone else (including the officer, employee, or designated agent’s family members).

Freezing Accounts

If we know that funds in an account come from criminal activities or fraudulent instructions, we must freeze the account. If the account holder is suspected of being involved in reported fraudulent activities, the account may need to be frozen.