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AML & CTF Policy of UAB EXZi Markets
The definitions given below explain the intended meanings of the listed terms:
| AML Policy | AML and CTF Policy of UAB EXZi Markets |
| Business Relationship | shall mean a business, professional, or commercial relationship between the Company and the Client relating to their professional activities that, at the time of establishment thereof, was expected to continue for a certain period of time (e.g. conclusion of an agreement between the Client and the Company, continuous performance of monetary operations and transactions). |
| Close Associate | shall mean: 1. a natural person who, together with a person who performs or has performed a Prominent Public Functions, is the participant of the same legal entity or the organisation without legal personality or maintains other business relations; 2. a natural person who is the only Beneficial Owner of a legal entity or an organisation without legal personality setup that is established or operating de facto with a view to receive economic gain or other personal benefits for a person who performs or performed a Prominent Public Functions. |
| Close Family Members | shall mean a spouse, the person with whom partnership has been registered (i.e. the cohabitant), parents, brothers, sisters, children and children’s spouses, children’s cohabitants. |
| FATF | shall mean the Financial Action Task Force, a supranational body that sets standards to combat money laundering and terrorist financing. |
| FCIS | shall mean the Financial Crimes Investigation Service under the Ministry of the Interior of the Republic of Lithuania. |
| GDPR | shall mean Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data and repealing Directive 95/46/EC (General Data Protection Regulation). |
| ML (money laudering) | shall mean money laundering to be construed as either of the following: 1. the legal status conversion or transfer of Property, knowing that such Property is derived from criminal activity or from an act of participation in such activity, for the purpose of concealing or disguising the illicit origin of the Property or of assisting any person who is involved in such activity to evade the legal consequences of this activity; 2. the concealment or disguise of the true nature, source, origin, location, disposition, movement, rights with respect to, or ownership of Property, knowing that such Property is derived from criminal activity or from an act of participation in such activity; 3. the acquisition, possession or use of Property, knowing, at the time of receipt/transfer, that such Property was derived from criminal activity or from an act of participation in such activity; 4. preparation for, attempts to commit, and complicity in committing any of the activities mentioned above. |
| Transaction | shall mean any payment, transfer, or receipt of virtual currency. |
| PEP | shall mean politically exposed natural persons who are or have been entrusted with Prominent Public Functions, as well as their Close Family Members or Close Associates. |
| Prominent Public Functions | shall mean the following functions in the Republic of Lithuania, European Union, international or foreign state banks: 1. the Head of the State, the Head of the Government, a minister, a vice-minister or a deputy minister, the State Secretary, the Chancellor of the Parliament or the Government or a ministry; 2. a member of the Parliament; 3. a member on the Supreme Courts, the Constitutional Courts or any other supreme judicial authorities whose decisions are not subject to appeal; 4. the mayor of a municipality, the head of a municipal administration; 5. a member of the management body of the supreme national audit and control body or the chairman, deputy chairman, or member of the board of a central bank; 6. an ambassador, a chargé d’affaires ad interim, Chief Commander of the Lithuanian Armed Forces, commanders of army forces and units, chief of defence staff or a senior officer of the foreign armed forces; 7. a member of a managing or supervisory body of a state-owned entity, public limited liability company, private limited liability company where the state owns shares or proportion of shares entitling to more than ½ of all votes at a general meeting of shareholders of said entities or companies; 8. a member of a managing or supervisory body of a municipal entity, public limited liability company, private limited liability company where the municipality owns shares or proportion of shares entitling to more than ½ of all votes at a general meeting of shareholders of said entities or companies and which are considered as large companies under the Law on Financial Statements of Undertakings of the Republic of Lithuania; 9. the head or deputy head or member of a managing or supervisory body of an international intergovernmental organisation; 10. the head, deputy head, or member of a managing body of a political party. |
| Property | shall mean items, money, securities, other financial instruments, other assets and property rights, products of intellectual activity, information, actions and outcomes of actions, other property and non-property related valuables, as well as any other physical or not physical, movable or immovable, tangible or intangible property and legal documents or instruments in the form of any kind, including electronic or digital, proving of title to such property or the related rights. |
| Representative | shall mean the executive manager of the Client or its authorised representative acting in accordance with the Power of Attorney. |
| Risk Country | shall mean a country that, for the purposes of ML/TF prevention, is classed as a higher-risk country, is subject to European Union or United Nations sanctions or other limitations, as well as a country that is categorised by the European Commission or FATF as a high-risk or non-cooperative country. |
| Suspicious Transactions | shall mean a Transaction involving Property which is suspected to have been received, either directly or indirectly, from a criminal act or involvement in such an act and/or is suspected to be associated with ML or TF. |
| Target Area | shall mean a foreign state or area where taxes are very low or do not exist, is listed into the list of Target territories established by the minister of finance of the Republic of Lithuania and where entities incorporated in it seek to assume minimal tax liabilities or to evade such liabilities altogether. |
| Third Country | shall mean any state other than the European Union and European Economic Area Member States. |
| TF | shall mean terrorist financing, the activity considered as a felony under Article 2 of the International Convention for the Suppression of the Financing of Terrorism of 9 December 1999. |
| SAR | Suspicious Activity Report: A report filed to report potentially suspicious activities or transactions. |
| STR | Suspicious Transaction Report: A report filed when a transaction is placed on hold due to suspicion. |
| AML/CTF | Anti-Money Laundering/Counter-Terrorist Financing |
| ODD | Ongoing Due Diligence: Continuous assessment and monitoring of Customers to mitigate risk. |
| EDD | Enhanced Due Diligence: A higher level of scrutiny applied to higher-risk Customers or transactions. |
| CDD | Customer Due Diligence: The process of verifying the identity and assessing the risk of a customer |
| Customer | A natural person that UAB EXZi Markets has established a business relationship with |
| Law | Law on the Prevention of Money Laundering and Terrorist Financing |
| Company/EXZi markets/we and us | Shall mean UAB EXZi markets a legal entity registered in Lithuania, legal registry number: 306143232, registered address: J. Basanavičiaus str. 26, Vilnius, Lithuania |
| Wallet | A crypto wallet (cryptocurrency wallet) is software or hardware that enables users to store and use cryptocurrency |
1. Introduction
UAB EXZi Markets, referred to as the "Company," "we," "us," is a registered Virtual Currency Exchange Operator operating under the Laws of Lithuania, committed to upholding the highest standards of integrity and compliance with the Republic of Lithuania Law on Prevention of Money Laundering and Terrorist Financing, referred to as the "Law," and applicable FCIS orders. As a Virtual Asset Service Provider (VASP), we provide cryptocurrency exchange services exclusively to natural persons, ensuring a secure and transparent platform for digital asset transactions.
Recognizing the inherent higher risk of money laundering and terrorist financing activities in the cryptocurrency industry, UAB EXZi Markets has implemented stringent measures and procedures to prevent and detect illicit activities within our operations and ensure a proper reporting process. To maintain the integrity of our financial services, we have developed an AML Policy to safeguard against money laundering and terrorist financing risks and ensure a Risk-Based Approach (RBA).
By implementing this AML Policy and its Annexes, UAB EXZi Markets demonstrates its commitment to combatting money laundering and terrorist financing within the cryptocurrency industry. Compliance with this Policy is mandatory for all employees. Any violation may result in disciplinary action, legal and/or regulatory consequences, and reputational damage. Through proactive measures, robust procedures, and ongoing education, we aim to contribute to the integrity, trust, and stability of the cryptocurrency industry. Our commitment to stringent anti-money laundering measures ensures a secure and transparent platform for digital asset transactions, safeguarding the reputation and trust of our valued customers. At UAB EXZi Markets, we prioritize the highest standards of integrity and compliance to protect against money laundering and terrorist financing risks within the cryptocurrency landscape.
2. Risk Appetite
As a Virtual Asset Service provider (VASP), we operate under the laws of Lithuania and uphold the highest standards of integrity and compliance with the Republic of Lithuania Law on Prevention of Money Laundering and Terrorist Financing. Our Risk Appetite Statement is not a static document merely intended for regulatory compliance; rather, it serves as a dynamic framework in conjunction with the commercial needs and strategic objectives of our business.
We acknowledge that cryptocurrency-related services inherently entail a higher risk of money laundering and terrorist financing, making it imperative for us to implement robust measures and procedures to prevent and detect illicit activities.
As part of our dedication to anti-financial crime efforts, we have established a risk-based approach that allows us to assess risk either prior or during business relationship establishment. This approach necessitates ongoing attention, and our AML Team diligently assesses customers before and after establishing business relationships that enforce and give the visibility of data to monitor whether we are in line with our risk appetite. Our risk management measures are calibrated to be proportionate to the level of risk applied to each customer, allowing us to effectively navigate the inherent risks posed by our target customer base.
Through the regular performance of EWRA and individual risk assessments on an ongoing basis, we continually assess and adapt our approach to risks associated with our customers which can result in termination of business relationships with certain groups of our Customers.
3. Customer Due Diligence Principles
As UAB EXZi Markets will not apply simplified due diligence, means that all customers will undergo a standard due diligence as a minimum and enhanced due diligence where there is a higher risk of money laundering/terrorism financing.
UAB EXZi Markets has established steps and document requirements within our procedures as Annexes within this Policy for onboarding and ongoing due diligence purposes and it adheres to the main following business relationship establishment principles and steps:
- ID&V of the potential customer
- Screening against sanctions, PEP and negative adverse media lists
- Collecting answers within an online customer questionnaire and scoring against pre-defined risk assessment logic
- Risk assessment and decision making on customer business relationship establishment based on the risk level applied
- Enablement or rejection of the customer and documentation of such decisions
UAB EXZi Markets has established all types of customer due diligence that are applicable prior to and during business relationships and required to be conducted as per the Law. The Company has a legal obligation to ensure that these processes are up-to-date with regulatory requirements, enforced, and reviewed periodically. UAB EXZi Markets is dedicated to maintaining a robust and effective AML framework, which includes the implementation of various types of due diligence procedures.
At UAB EXZi Markets, we prioritize Standard Customer Due Diligence (CDD) as the fundamental step in our due diligence processes, which applies to all our natural person customers by default, therefore standard due diligence is considered as a collection of base information of our customers.
Ad for Enhanced Due Diligence, we are obliged to do a thorough review of obtained Customers’ information, including the to request for additional documents, such as source of wealth, etc. where deemed necessary.
The customer information is regularly updated after business relationships with Customers are established in line with regulatory obligations which means that the customers receive requests to update their KYC information on a regular basis. The frequency of information renewal is established in line with risk based approach.
Prior to establishing a business relationship with any customer, a thorough risk assessment must be conducted taking into account customer, product/services, geographic and delivery channel risks, which has implications on the above-mentioned processes.
4. Ongoing Monitoring, Investigations & Reporting
At UAB EXZi Markets, we are committed to maintaining the standards of integrity and compliance with anti-money laundering measures as well as Lithuanian FCIS’es expectations. While periodic and event-driven due diligence is one part of our AML/CTF obligations, a robust and risk-based approach transaction monitoring process is implemented as well. In order to ensure the compliance with regulatory expectations, we use software to conduct transaction monitoring in order to identify and prevent financial crime activities.
By employing a risk-based approach and utilizing efficient systems and controls, UAB EXZi Markets is dedicated to monitoring and mitigating any potential money laundering and terrorist financing risks effectively to ensure our platform’s security and integrity of business operations.
- AML Reporting and information sharing Obligations with Authorities
Submitting SARs/STRs is a mandate set forth by the Lithuanian FCIS, aimed at supporting the detection, prevention, and prosecution of financial crimes. Our SARs/STRs contain sufficient contextual information and specify the reasons behind the potential financial crime that has been committed or is planned to be committed. These detailed reports provide valuable intelligence to the FCIS, enabling them to thoroughly investigate and take appropriate action against potential offenders.
The Company also has a legal responsibility to submit periodic reports about its’ customers and transactions, including ad-hoc requests of information to Authorities such as Prosecutor Offices and etc. The Company shares information only in line with regulatory obligations and the extent of information shared is limited to the scope of the request. The information is shared through secure channels to safeguard its integrity.
6. Screening Process Implementation (Sanctions, PEP, Negative Adverse Media)
At UAB EXZi Markets, we are firmly committed to maintaining and enforcing an effective screening process to comply with all relevant Lithuanian regulatory requirements, as well as the expectations set forth by the Lithuanian Financial Crime Investigation Service (FCIS) and adhering to industry best practices. Our screening process is designed to identify and mitigate risks associated with sanctions, politically exposed persons (PEP), and negative adverse media (NAM).
Our screening process is, in line with the Law, applied both before and after the establishment of a business relationship with customers and is conducted on an ongoing basis.
At UAB EXZi Markets, we acknowledge the importance of complying with international sanctions and politically exposed persons (PEP) obligations set forth by various governments and international organizations. At UAB EXZi Markets, we strictly adhere to the sanctions administered by the European Union, the United Nations Security Council, the United States, including those imposed by the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC), FCIS List of entities controlled by sanctioned individuals, as well as any PEP status imposed by governments to parties we screen. Our commitment to these obligations helps us mitigate compliance, regulatory, and reputational risks associated with engaging in business relationships or transactions with sanctioned entities.
- Record-keeping
The Company shall inform customers about the processing of their personal data as required by Articles 13 and 14 of Regulation (EU) 2016/679 before entering into a business relationship or before executing a single monetary operation or transaction. Information on the processing of personal data shall be available on www.exzi.com “Privacy Policy” section.
Data storage timeframes are the following:
| Type of data | Timeframe |
| Copies of Customer’s Identification documents, identity data, records of real time video identification or real time photo transmission made during remote identification, other data received during the customer’s identification, agreements, invoices and other documented collected in relation to the Business Relationship with the Customer (in cases of several products despite the fact that one product was terminated, all the information must be stored related to the Customer 8 years from the day of the last product termination) | 8 years as of the day of the end of Business Relationship with the Customer |
| Documents and data confirming performance of the Monetary Operation or Transaction | 8 years as of the date of performance of the Monetary Operation/ transaction |
| Correspondence with the Customer related to the Business Relationship and AML / CTF matters (both official correspondence with the Customer and also correspondence by emails, via internal system and correspondence by other electronic means) | 5 years as of the day of the end of Business Relationship with the Customer |
| Letters and documents by which findings of the investigation of complicated or unusually large transactions and unusual structures of transactions are documented | 5 years |
| The time limits for record keeping may be additionally extended for no longer than two years upon a reasoned instruction of a competent authority. |
Final provisions
UAB EXZi Markets is committed to maintaining the highest standards of Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) measures in accordance with Lithuanian regulatory requirements and industry best practices. AML Policy serves as a comprehensive framework to address potential money laundering and terrorist financing risks and guide our employees in conducting their duties in a diligent and responsible manner. We adopt a risk-based approach to AML/CTF, focusing on identifying, assessing, and managing risks associated with customers, products, services, and geographic locations. This approach enables us to allocate resources effectively, prioritize higher-risk areas, and maintain a strong and effective AML framework.
Comprehensive records of customer due diligence, transaction monitoring, and other AML-related activities are maintained to comply with regulatory requirements and facilitate audits and regulatory inspections. UAB EXZi Markets is committed to continuous improvement and review of its AML/CTF measures to adapt to evolving risks and changes in the regulatory landscape, ensuring the highest standards of AML compliance and customer protection.