General Information about the Company
Arbitrage Capital maintains high standards in anti-money laundering, and is doing its best in preventing any activities that are aimed at or are facilitating decriminalization of any funds of illegal origin.
The jurisdiction of the Company’s incorporation enjoys elaborated legislation in arbitrage regulation domain. The Company undergoes annual audit in terms of any violations of the relevant legislation provisions, followed with a statement issued by the State Registrar confirming that the Company is in good standing and is running in full compliance with national laws. In addition, the Company annually receives an independent legal opinion from among The Legal 500 companies, as an additional acknowledgment of the Company’s lawful activity aligned with national regulations.
To detect, prevent and alarm about any transactions aimed at transforming the proceeds from illegal activity into another kind of money facilities which are deemed legal, the Company has established the following procedures.
Monitoring of Customers Activity
Customers activity is monitored by many different ways at all levels of customers interest and involvement. Thus, on the first level, customers are given the status of Lead: those who have expressed their interest in the Company’s services, who have been around at the Company’s website for a while, and so on. The information collected about such customers will be represented in a report to be later used by the Company’s financial advisors for further work with the customers and for scoring them. Next, the customers who have completed the registration and the AML procedure, are awarded a New Client status. Such customers, depending on how promising and how experienced in independent trading they are, and based on other reasons, will be grouped into Silver, Gold and Platinum categories; activity of such customers in each group will be monitored by the Company’s staff in terms of various pivotal signs (particularly, a new customer deposition activity report: amounts, quantities, average bill, currency, a preferred way of payment – this is the information which allows making the primary customer risk assessment). Then, active customers will be divided by markets geography: quantitative indicators, deposition methods, preferred strategies of trading, frequency of transactions, use of Forex indicators, and other figures are recorded. At the end of customer cycle with no customer activity in trading accounts, such customers will be grouped into a separate report and shall undergo indirect review by financial advisors to specify a reason for their trading activity termination.
Funding and Withdrawal Transactions Monitoring
All the customers transactions for money funding and withdrawal from their personal trading account must comply with the following requirements:
Whenever the account is funded by various payment methods, the money shall be withdrawn by the same methods in proportion to the deposited amounts.
In the event that a trading account was funded with cryptocurrency, the Company reserves the right to allow the funds withdrawal only to the crypto wallet used to make a deposit. If the account was funded using a crypto exchange wallet (eg. Binance), a screenshot of the trasnaction/transaction hash can be additionally requested. It should contain the address of a personal crypto wallet with this exchange and the QR code of the transaction. When funding through an exchanger, a screenshot of the transaction/transaction hash/automatic confirmation email from the exchanger can also be requested.
Training our Staff in Modern AML Procedure Rules
Financial department personnel responsible for customers’ deposition and withdrawal transactions and for verification of major identification documents keep researching the market looking for any AML policy renewals, and are regularly trained in regulations updates according to FATF и Big4 Business Bulletins. On a quarterly basis, the personnel are certified for awareness in the information required for efficient performance, particularly, about the Company’s CTF/AML procedures.
Timely Response to Red Flags and to Other Signs of Customer’s Suspicious Behavior
All non-commercial transactions undergo money laundering examination during all the stages of money movement in the process of money laundering:
At this stage, the funds are transformed into other financial instruments, such as cheques, bank accounts, wire transfers. Alternatively, the funds can be used to buy expensive commodity which can be easily resold later. The money can also be invested into banks and non-bank institutions (e.g., currency exchange offices). To avoid any suspicion from the Company, a money laundering person may opt to make several depositions instead of a lump sum investment. This method of money placement is known as smurfing.
Money funds are transferred or moved onto other accounts and into other financial instruments. This is done to conceal the origin and prevent from identifying a person who has made several financial transactions. Transferring and reshaping the money facilities complicates the process of laundered money tracing.
The money is returned to circulation as legally earned to pay for goods and services. The Company has introduced a unique practice called Moratorium: this is a standstill period of 10 days during which the money is forbidden to withdraw. The Moratorium is enabled whenever a customer has funded money but neglected to trade at financial markets. Transactions in money funding will also be checked for the “brute force” method (using several plastic cards via multiple payment agents offered by the Company, receiving specific error code while trying to make a payment, using cards issued by bank institutions located in different regions), using several payment methods within a short period of time (cards, e-wallets, wire transfers), refusal to verify any payment method, inconsistency between key elements geography (such as a country of citizenship, a country of mobile phone operator, IP-address location, a card’s BIN, etc.), ultimate refusal to have a voice phone conversation, failure to provide a customer’s photo holding an ID upon request, one account’s computer CID coinciding with another account’s CID in our system.
Thus, to prevent the Company’s services being used by criminals for the purpose of money laundering, terrorism financing, or some other criminal activity, Arbitrage Capital hereby undertakes:
to request the relevant IDs for the purpose of Customer identification;
to evaluate the risk of whether a Customer is engaged in money laundering or terrorism financing;
to check if the Customer’s country is among the countries which, according to FATF, fail to comply with requirements in prevention of money laundering and terrorism financing;
to re-identify the Customer, should any doubts arise concerning validity of the information obtained during the primary identification;
to avoid having any business relations with unidentified customers.
Three risk categories are considered during risk evaluation:
a person’s location or place of residence: country-based and geography-based risks are considered.
parameters characterizing a person who is a party of transaction: customer risk is considered
business activity of the person engaged in the transaction: product-related and services-related risks are considered.