Anti-Money Laundering (AML) Policy

1.0. Introduction

SPACETRADE TECHNOLOGIES LIMITED (‘Spacetrade’) is committed to the highest standards of Anti-Money Laundering (AML) compliance. This AML Policy has been established to prevent and detect money laundering, terrorist financing, and other illegal activities by applying stringent compliance measures. This policy aligns with international and local regulations, including the Financial Action Task Force (FATF) standards, Central Bank of Nigeria’s guidelines, and the Money Laundering (Prevention and Prohibition) Act.

2.0. Purpose

The purpose of this AML Policy is to:

• Prevent the use of SPACETRADE’s platform for money laundering, terrorist financing, or any unlawful activity.
• Ensure compliance with local and international AML regulations, including effective transaction monitoring and suspicious activity reporting.
• Maintain the integrity and transparency of SPACETRADE’s platform to protect customers, stakeholders, and the broader cryptocurrency ecosystem.

3.0. Scope

This policy applies to:

• All SPACETRADE employees, including those involved in compliance, transaction monitoring, and customer service.
• All third-party service providers and partners involved in SPACETRADE’s operations.
• All customers using SPACETRADE’s platform for cryptocurrency transactions.

4.0. Definitions

• Anti-Money Laundering (AML):A set of procedures, regulations, and laws designed to prevent criminals from disguising illegally obtained funds as legitimate income.
• Suspicious Transaction Report (STR):A report submitted to financial intelligence units (FIUs) for transactions deemed suspicious or unusual, potentially indicating money laundering or other financial crimes.
• Politically Exposed Person (PEP):An individual in a prominent public position or their close associates, who may pose a higher risk of involvement in bribery or corruption.

5.0. Transaction Monitoring and Risk Management

SPACETRADE has implemented a comprehensive transaction monitoring system that flags and reviews suspicious activities in real-time. The transaction monitoring framework includes:

• Threshold-Based Alerts:Transactions that exceed specific thresholds are flagged for review. This includes high-value transactions, multiple transfers within a short period, and cross-border transfers.
• Pattern and Anomaly Detection:The system monitors patterns in transactions to identify unusual behaviors, such as rapid transfers, irregular transaction amounts, and frequent small deposits that may signal structuring or layering.
• Real-Time Monitoring:All transactions are monitored in real-time to enable swift action when suspicious activities are detected. This real-time monitoring includes ongoing risk profiling and adjustment of customer risk scores based on observed behavior.

6.0. Suspicious Transaction Reporting (STR)

SPACETRADE is committed to fulfilling its reporting obligations in compliance with local and international AML requirements. This includes promptly identifying and reporting suspicious transactions to relevant authorities.

• Identification of Suspicious Transactions:Any transaction that appears inconsistent with a customer’s known financial behavior, is unexplainably large, or exhibits unusual patterns will be flagged for investigation.
• Reporting Process:Once a transaction is deemed suspicious, an STR is prepared and submitted to the relevant Financial Intelligence Unit (e.g., the Nigerian Financial Intelligence Unit - NFIU) within 24 hours.
• Documentation of Reports:Each STR is documented with full transaction details, customer information, and the reasons for suspicion. These records are securely retained for regulatory review and compliance audits.
• No Tipping-Off Policy:SPACETRADE enforces a strict “no tipping-off” rule, which prohibits employees from informing customers about the existence or filing of an STR, as doing so could interfere with investigations.

7.0. Customer Risk Assessment ad Classification

SPACETRADE applies a risk-based approach to AML compliance, with each customer assigned a risk score based on various criteria:

• Risk-Based Customer Classification:Customers are classified into risk categories (e.g., low, medium, high) based on factors like geography, occupation, transaction behavior, and PEP status.
• Enhanced Due Diligence (EDD) for High-Risk Customers:High-risk customers, such as PEPs or those from high-risk jurisdictions, undergo Enhanced Due Diligence, including more frequent monitoring, additional documentation, and regular profile reviews.
• Periodic Review of Customer Risk Profiles:Risk classifications are reviewed periodically to reflect any changes in customer behavior or regulatory guidance. Customers may be reclassified to higher or lower risk levels based on updated information or transaction patterns.

8.0. Record-Keeping

SPACETRADE maintains comprehensive records of all transactions and customer interactions to ensure compliance with AML regulations. Record-keeping standards include:

• Retention Period:Transaction records, including STRs and customer identity information, are retained for a minimum of five years after the transaction date or the end of the business relationship.
• Detailed Transaction Records:For each transaction, SPACETRADE records details such as transaction type, date, amount, customer details, and any additional analysis or comments.
• Audit Trail:An accessible audit trail is maintained for all AML activities, enabling regulators and auditors to trace the origins of transactions and verify compliance with internal controls.
• Secure Storage:All records are stored securely in an encrypted database, with access restricted to authorized personnel to protect the privacy and security of customer data.

9.0. Risk-Based Internal Controls

SPACETRADE has implemented rigorous internal controls to minimize exposure to AML risks. These controls include:

• Continuous Risk Assessment:Regular assessment of AML risks associated with new products, services, and changes in regulatory requirements.
• Risk Mitigation Strategies:Applying stronger monitoring measures and verification processes for high-risk products, services, and customer segments.
• Periodic Internal Audits:Regular audits of the AML controls and policies to ensure effectiveness. Any findings from these audits are addressed through corrective actions and procedural adjustments.

10.0. Employee Training and Awareness

To maintain a high standard of AML compliance, SPACETRADE conducts regular training programs for all relevant staff, covering topics such as transaction monitoring, suspicious activity identification, and reporting obligations.

• Mandatory Training:All employees involved in customer service, compliance, and transaction monitoring undergo mandatory AML training during onboarding and on an annual basis.
• Ongoing Education:Training content is updated regularly to reflect new trends, regulatory changes, and emerging risks in the cryptocurrency sector.
• Assessment and Testing:Employees’ understanding of AML procedures is periodically assessed through tests and assessments to ensure ongoing compliance awareness.

11.0. Internal Audit and Independent Testing

To ensure ongoing compliance, SPACETRADE conducts independent testing and audits of its AML framework. This process includes:

• Regular Audits:Internal audits are conducted annually to evaluate the effectiveness of AML controls, transaction monitoring systems, and reporting protocols.
• Compliance Officer Oversight:The Compliance Officer is responsible for overseeing the AML program, ensuring that all staff follow procedures, and coordinating with regulators.
• Independent Testing:An independent party, either an internal audit team or an external auditor, performs testing to validate the AML program’s effectiveness. Testing results are reviewed, and any deficiencies are promptly addressed.

12.0. Data Protection and Confidentiality

SPACETRADE ensures the confidentiality and security of all customer and transaction data to comply with data protection regulations.

• Encryption of Sensitive Data:All transaction records, STRs, and customer details are stored in encrypted form, protecting against unauthorized access.
• Restricted Access:Access to AML records is limited to authorized personnel only, ensuring compliance with data privacy regulations and protecting sensitive customer information.

13.0. Penalties and Non-Compliance

SPACETRADE enforces penalties for non-compliance with AML policies to maintain the integrity of its platform and ensure adherence to regulatory requirements.

• Employee Sanctions:Employees who fail to comply with AML protocols or engage in misconduct may face disciplinary action, including termination, fines, or legal consequences.
• Customer Sanctions:Customers engaged in suspicious activities may have their accounts restricted, suspended, or terminated.
• Third-Party Penalties:Any third-party service providers failing to adhere to SPACETRADE’s AML standards may face contract termination and possible legal action.

14.0. Policy Review and Updates

SPACETRADE’s AML policy is subject to periodic review to ensure it remains aligned with regulatory requirements and industry best practices.

• Annual Review:The AML policy is reviewed at least annually by the Compliance Officer, with input from the internal audit team.
• Immediate Updates for Regulatory Changes:If regulatory changes occur, the AML policy is updated promptly to remain compliant.
• Stakeholder Communication:Policy changes are communicated to relevant stakeholders, including employees and customers, to maintain transparency and compliance.

15.0. Conclusion

SPACETRADE’s AML Policy is a critical element in maintaining a secure and compliant environment for cryptocurrency transactions. By implementing this policy, SPACETRADE ensures compliance with both local and international AML regulations, protecting customers and promoting the integrity of the cryptocurrency industry.