KYC/AML Policy

1. Anti-Money Laundering (AML) Policy

Policy Statement

Capital Chain is committed to preventing money laundering and terrorist financing. This policy applies to all employees, contractors, and business partners. Unwavering compliance with applicable laws and regulations shall serve to safeguard Capital Chain's reputation and uphold public trust in Capital Chain.

Therefore, it is advisable for Capital Chain to establish an anti-money laundering (AML) policy that delineates the prescribed measures to be observed, aiming to ensure the efficient execution of guidelines that support the attainment of overarching organizational goals, while guaranteeing conformity with the regulatory structure and ensuring compliance with applicable laws and regulations in all jurisdictions where Capital Chain operates.

Policy Objectives

• To establish precise and unambiguous policies for Capital Chain concerning the matters of money laundering, terrorist financing, and the avoidance of sanctions.
• To provide clear and concise explanations of the compliance responsibilities of employees.
• To offer guidance to employees regarding their daily business activities in alignment with legal requirements.
• To foster a work environment that upholds a culture of adherence to legal regulations in the manner in which employees execute their duties.

Definition of Money Laundering

As per Article 2 of the AML Law, money laundering is the engagement in any of the following activities with knowledge that the funds are derived from a criminal act:

• Transfers or moves the proceeds, or disposes of the funds/proceeds intending to conceal or disguise their source.
• Conceals or disguises the true nature, source or location of the proceeds including the manner of disposal.
• Acquires, possesses or uses the proceeds on receiving them.
• Assists the person who committed the felony/misdemeanor to escape punishment.

Money laundering is always an intentional act. Acts exhibiting gross negligence, particularly failure to report suspicions of criminality, may incur criminal liability.

Laws and Regulations

Capital Chain complies with, including but not limited to:

• UAE Federal Law No. 20 of 2018 (AML Law)
• Cabinet Resolution No. 10 of 2019 (AML Regulations)
• UAE Federal Law No. 7 of 2014: Combating Terrorism Crimes
• UAE Federal Penal Law No. 3 of 1987 (Penal Code)
• UAE Federal Penal Procedures Law No. 35 of 1992
• UAE Federal Law No. 5 of 2012: Combating Cyber Crimes
• SCA Decision (17/R) of 2010
• UAE Central Bank AML Regulations (e.g., Circular No. 24/2000 and amendments)
• Applicable United Nations sanctions ratified by the UAE

Financial institutions must adopt a risk-based approach for onboarding and periodic AML assessments. Capital Chain implements a robust risk-based compliance program in accordance with legal mandates and best practices.

Investigatory Powers and Criminal Enforcement

Suspicious activity reporting and investigation in the UAE falls under the FIU at the UAE Central Bank. The Public Prosecution initiates legal proceedings and cases are adjudicated by criminal courts.

Defenses

No specific defenses exist for money laundering beyond general criminal law defenses. Once the Public Prosecutor determines actions amount to money laundering, the case must be referred to the courts; settlement/plea is not available.

Detection of Unusual/Suspicious Transactions

Transactions predominantly range from $9 to $999. A meticulous manual approval process is applied with due diligence on each transaction to detect abnormal or suspicious activity and to maintain compliance with AML/CFT requirements.

Risk Rating

A dedicated risk management unit conducts manual examination of client profiles. Comprehensive risk assessment and due diligence are performed according to the customer’s risk rating to mitigate potential risks in line with applicable frameworks.

Resolutions and Sanctions

Administrative sanctions for non-compliance may include warnings, fines, business limitations or suspensions, and actions against accountable board/senior management. AML Law penalties for conviction range from AED 100,000 to AED 10 million and up to 10 years’ imprisonment.

Capital Chain’s Obligations

• Identify potential risks associated with criminal activities within operations.
• Conduct ongoing assessments of identified risks.
• Establish internal controls and policies to manage risks.
• Implement appropriate due diligence procedures.
• Adhere to United Nations directives on counter-terrorism financing and proliferation financing.

Designated Compliance Team

The Risk Management team regularly performs compliance testing. A Designated Compliance Officer is responsible for the comprehensive AML/CFT program and its day-to-day coordination and oversight.

Contact

Capital Chain Group Ltd., Opal Tower, Bussiness Bay, Dubai

Email: info@capitalchain.co