KYC & AML Policy of Key Labs

Cryptology Key Labs LTD

1. Introduction

This document (hereinafter – K&AP) constitutes Cryptology Key Labs LTD (hereinafter – KL, or us) policy on combating money laundering, terrorism financing, and other illicit activities. It establishes standard procedures and controls with regard to the applicable regulation for the purpose of combating any adverse effect of such activities on the integrity of the digital assets markets.

K&AP applies to all employees, stakeholders, contractors and clients of KL, notwithstanding jurisdiction of origin.

With implementation of this policy, we are striving to comply with the applicable AML/KYC laws, regulations and guidelines with following:

• We prevent the use of KL services for money laundering, terrorism financing, or any other illicit activities;
• We identify and mitigate potential risks associated with money laundering, terrorism financing or any other illicit activities;
• We construct our activities in a such manner, which ensures full transparency of all of our processes related to provision of our services.

It is crucial to uphold to our K&AP in all cases in order to ensure and maintain the integrity of KL operations and reputation on the market.

We have a unit which is in charge of the AML/KYC matters – financial department, whose representative you can reach in order to ask any question in regard AML/KYC and related issues via this email [email address for support].

2. Standards

2.1. In general

KL, to the fullest extent of our best efforts, assesses the risks of money laundering, terrorism financing and other illicit activities taking into account risk factors relating to the clients themself, countries or geographic areas of client’s origin and transactions.

Considering K&AP in place, KL has established certain standards to identify our clients before entering into a business relationship.

2.2. Inadmissibility

KL undertakes, considering the ongoing russian-Ukrainian war, to take every measure necessary to ensure non-provision of services to the russian and belarusian citizens, residents and legal entities.

With this document KL constitutes the inadmissibility of the abovementioned persons, their affiliated and related persons (with whom such persons may have business or other relations, e.g., ownership relations).

3. Due diligence

3.1. Client Identification

KL shall collect comprehensive information to accurately identify and verify the identity of all clients as follows by using [instrument for gathering KYC information]:

For individuals, this includes obtaining the following:

• full legal name (first, second and last name);
• date of birth;
• nationality;
• residential address;
• government-issued identification document (internal or international);
• proof of location;
• basic information on source of wealth;
• other relevant information (may be requested ad hoc).

For legal entities, this includes obtaining the following:

• legal name;
• registration number;
• registered address;
• corporate documents;
• beneficial ownership structure;
• director structure;
• identification of shareholders, directors (and/or representative);
• relevant legal opinions relating to the client’s business;
• other relevant information (may be requested ad hoc).

3.2. Individual risk assessment

The factors taken into account for the individual risk assessment and classification (low/medium/high) of our clients on a risk-sensitive basis are the ones that are as follows:

• platform/vendor risk;
• asset/service or transaction risk;
• client risk;
• geographical risk;

bearing in mind the inherent risk nature and business standards of the digital assets market.

3.3. Enhanced due diligence

For clients presenting higher risks, KL may conduct enhanced due diligence procedures, which includes obtaining additional information, enhanced monitoring, and seeking shareholders’ approval for engaging in any business relationship.

Examples of risk factors that may trigger such enhanced due diligence may include:

• jurisdiction of origin/residence/citizenship;
• jurisdiction of birth or incorporation;
• nationality;
• profession/occupation;
• substance of economic activity;
• appearance on sanction lists (OFAC, EU Commission, NSDC of Ukraine, and other authorities of relevant jurisdictions);
• PEP-status (politically exposed persons) of clients, representatives, beneficial owners and their family members;
• source of wealth;
• type of client;
• type and size of payment, which may be expected;
• reputation of the client in relation to the digital assets market.

3.3.1. Source of funds and wealth

KL may request detailed information relating to the source of funds or wealth of clients, particularly those presenting higher risk. This may include requesting documentation such as

• bank statements;
• trade history;
• token deployment contracts;
• token distribution models and solutions;
• business financial records.

If needed, further verification of the legitimacy of the client’s source of funds or wealth may be undertaken to ensure that he/she is consistent with his/her declared financial activities and registrations.

3.3.2. Business relationships

For the clients, who conduct business involving transactions with high-value assets, complex ownership structures, or involving jurisdictions known for high levels of financial crime – in-depth background checks may be conducted on beneficial owners, senior management, and other associated parties in order to assess their reputability and potential risk factors.

Such clients may be requested to provide any and all relevant information to mitigate risks assessed.

3.4. Ongoing monitoring

KL carries periodic and risk-based reviews in order to ensure that client-related documents, data or information are kept up-to-date.

An enhanced ongoing monitoring shall be conducted for those clients presenting high risk for KL. This includes regular reviews of client’s activity, transaction patterns, and any relevant changes in risk factors assessed.

Any significant changes in the client’s profile or behavior may trigger a reassessment of the client’s risk rating, and the application of additional due diligence measures if necessary.

4. Monitoring of Transactions

KL implements transaction monitoring systems and processes to detect and investigate suspicious activities using [instrument of monitoring of activity]. Transaction monitoring could include the following:

• real-time monitoring of transactions on subject-matter of unusual patterns, large, complex or inconsistent transactions;
• retrospective analysis of transactions in order to identify potentially suspicious activity;
• regular reviews of transaction logs and reports.

5. Record Keeping

Records of personal data, obtained for the purposes of the prevention of money laundering and terrorism financing or other illicit activities, are processed and kept in accordance with the requirements of the applicable law of relevant jurisdiction (when and where applicable – to GDPR), and shall not be further processed in a way that is incompatible with those purposes. You may refer to our Privacy Policy (hereinafter – PP), [privacy policy page], where we address all the relevant issues and provide contacts for inquiries on privacy matters.

6. Internal Measures

6.1. Reporting

Suspicious transactions shall be reported in compliance with the respective laws and regulations by means of the responsible person. Issues and activity reports are reviewed on a regular basis. The quality of coverage of the internal control may be reviewed on an ad hoc basis.

6.2. Training

KL conducts regular training and awareness programs to all employees and vendors in order to ensure they understand their AML/KYC obligations, and are skilled enough to identify and report suspicious activities effectively.

6. Conclusion

KL is committed to maintaining the highest standards of integrity in due course of our business. This K&AP reflects our dedication to preventing illicit activities and protecting the integrity of our operations. All employees, stakeholders, vendors and clients are expected to adhere strictly to the provisions of this K&AP.

This K&AP may be reviewed periodically and updated as necessary to reflect changes in laws, regulations, and industry best practices.

7. Our contacts

Send us an email to the following address support@keylabs.trade with the subject matter of your concern (any of the aforementioned or else) related to AML/KYC subject-matter, and we shall answer you at our first convenience.

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