AML Policies and Procedures

Anti-Money Laundering (AML) Policies and Procedures for JMI Brokers

Risk Assessment:

A Risk-Based Approach (RBA) is a fundamental concept in Anti-Money Laundering (AML) compliance.

It involves assessing and mitigating AML risks by allocating resources based on the level of risk posed by customers, transactions, products, services, and geographic locations.

The assessment is applied by conducting comprehensive risk assessments to identify and evaluate inherent AML risks associated with various aspects, including:

Types of customers: Individuals, corporates, financial institutions, etc.

Products and services: Spot forex trading, derivatives, currency exchange, etc.

Geographic locations: High-risk jurisdictions with weak AML controls, politically exposed regions, etc.

Assessing the likelihood and potential impact of money laundering and terrorist financing activities based on factors such as customer profiles, transaction volumes, and regulatory requirements

Customer Due Diligence (CDD):

Applying different levels of due diligence based on the assessed risk level of customers:

Standard CDD for low-risk customers, involving basic identity verification and transaction monitoring.

Enhanced CDD for high-risk customers, requiring additional documentation, ongoing monitoring, and enhanced scrutiny of transactions.

Utilizing risk-based segmentation to tailor CDD measures to the specific risk profiles of customers, ensuring proportionate and effective risk mitigation

Transaction Monitoring:

Implementing transaction monitoring systems that are calibrated to detect suspicious activities based on predefined risk indicators:

Setting transaction thresholds and triggers based on risk assessment outcomes.

Employing advanced analytics and algorithms to analyze transactional data for anomalies and unusual patterns indicative of potential money laundering or terrorist financing.

Adjusting monitoring parameters based on changes in risk profiles and emerging threats identified through ongoing risk assessments

Suspicious Activity Reporting (SAR):

Establishing procedures for reporting suspicious activities to regulatory authorities in accordance with applicable laws and regulations:

Promptly investigating and documenting any suspicious transactions or behaviors identified through transaction monitoring or customer due diligence.

Filing SARs with the appropriate regulatory authorities, providing detailed information and supporting evidence of the suspicious activity.

Prioritizing SAR filings based on the perceived level of risk and potential impact of the suspicious activity on the JMI Brokers and the broader financial system

Training and Awareness:

Providing specialized AML training to employees involved in customer onboarding, transaction monitoring, and compliance functions:

Educating staff on the principles of RBA and how to apply risk-based decision-making in their day-to-day responsibilities.

Increasing awareness of AML risks and regulatory obligations, ensuring employees understand the importance of RBA in mitigating these risks effectively.

Ongoing Review and Adaptation:

Continuously reviewing and updating risk assessments, CDD procedures, and transaction monitoring protocols to reflect changes in the company s risk profile and regulatory requirements.

Conducting periodic audits and assessments of the effectiveness of RBA measures, identifying areas for improvement and implementing enhancements as necessary to strengthen AML controls

Reporting and Record-Keeping:

Procedures are in place for reporting suspicious activities to the relevant authorities in accordance with regulatory requirements.

Accurate and detailed records of customer transactions, KYC documentation, and AML compliance efforts are maintained for auditing and regulatory purposes

Reporting and Record-Keeping:

Customers are screened against international sanctions lists to ensure compliance with sanctions regulations.

Procedures are established for identifying and reporting any transactions involving sanctioned individuals or entities to the appropriate authorities.

Steps Taken in Case of Suspicious Activity:

Upon detection of suspicious activity, the Compliance Department is immediately notified.

The Compliance Department conducts a thorough investigation, gathering additional information and evidence related to the suspicious activity.

If warranted, the Compliance Department escalates the matter to senior management for further review and decision-making.

Depending on the severity of the suspicious activity, appropriate actions are taken, which may include freezing or terminating the customer s account, filing a suspicious activity report (SAR) with the relevant authorities, and cooperating with law enforcement agencies as necessary.

A post-incident review is conducted to assess the effectiveness of existing AML controls and identify any areas for improvement.

By adopting a risk-based approach to AML compliance, our company can allocate resources more efficiently, focus efforts on higher-risk areas, and better protect ourselves and the financial system from the threats of money laundering and terrorist financing.