1. Policy Statement
Peloton Blockchain PTE LTD (“Peloton Blockchain”) together with its affiliates (“the Peloton Group”) is a “compliance first” organization which undertakes to operate at all times in the highest ethical and professional manner. The Peloton Group is committed at all levels of the organization to operate in conformity with all laws and regulations which apply to the conduct of its business. All Peloton Group employees and contractors are required to make every effort to prevent any affiliate or corporate entity of the Peloton Group from being used to facilitate criminal activity. The Peloton Blockchain anti money laundering (“AML”), counter the financing of terrorism (“CFT”), and sanctions compliance (“SC”) policies, (together the “AML Policy”) sets out the policies, procedures, systems, and controls that all Peloton Group directors, employees and contractors must observe and adhere to ensure compliance with the requirements and principles of the relevant laws, rules, and regulations by which the Peloton Group is regulated now or in the future.
The Peloton Blockchain AML Policy is not intended to reproduce any rules or regulations that may be applicable to the Peloton Group but rather to set out the guidelines for behavior for Peloton Group employees and provide guidance for the operation of all individual Peloton Group affiliates which are responsible for developing and implementing the requirements of the AML Policy and complying with the laws and regulations of any jurisdiction where-so-ever, to which any Peloton Group affiliate may be subject.
2. Money Laundering Defined
The “Notice to Capital Markets Intermediaries – Monetary Authority of Singapore ACT, CAP.186 on the Prevention of Money Laundering and Countering the Financing of Terrorism” (“MAS Notice SFA 04-N02”) sets out the obligations of Capital Markets Intermediaries (“CMI”) to take measures to mitigate the risk of Singapore’s capital markets being used for money laundering or terrorist financing.
Sections 10 of the “Guidelines to MAS NOTICS SFA04-N02 On Prevention of Money Laundering and Countering The Financing of Terrorism (“SFA 04-N02 Guidelines”), states that money laundering as “a process intended to mask the benefits derived from criminal conduct so that they appear to have originated from a legitimate source.
Section 11 of the SFA 04-N02 Guidelines states that, “generally, the process of money laundering comprises three stages, during which there may be numerous transactions that could alert a CMI to the money laundering activity:
- Placement - The physical disposal of the benefits of criminal conduct.
- Layering - The separation of the benefits of criminal conduct from their source by creating layers of financing transactions designed to disguise the audit trail; and
- Integration - The provision of apparent legitimacy to the benefits of criminal conduct. If the layering process succeeds, the integration schemes place the laundered funds back into the economy so that they re-enter the financial system appearing to be legitimate business funds.“
Additionally, Peloton Blockchain recognizes that cryptocurrencies and digital tokens by their nature raise new challenges in relation to money-laundering, terrorist financing and sanctions compliance particularly with respect to the use of cryptocurrency specific money laundering processes and services such as “mixers”, “tumblers”, and “foggers”.
3. Peloton Group AML Policy, Procedures, Systems, and Controls
The MAS Notice SFA 04-N02, applies to (a) all holders of capital markets services licenses under Singapore’s Securities and Futures Act (Cap. 289) (“SFA”) and to (b) all persons exempted from the requirement of having to hold a capital markets services license.
Peloton Blockchain’s executive management shall implement policies, procedures, systems and controls that reflect and meet the requirements of Singapore’s money laundering and countering the financing of terrorism legislation and guidance. This executive action reflects Peloton Blockchain’s policy to ensure that its products and service offering should not facilitate money laundering, the financing of terrorism, or sanctions non-compliance.
The Peloton Blockchain policies, procedures, systems and controls will:
- Ensure Peloton Blockchain executive committee are provided regular management information and updates regarding the operation and effectivness of the Peloton Blockchain AML systems and controls in reation to identification, categorization and measurement, management, and control the Peloton Group’s money laundering risks.
- Have sufficient capability to accurately determine whether Peloton Blockchain investors, clients, or beneficial owners of investors or clients are politically exposed persons (“PEP”), and
- Enable Peloton Group to comply with Singapore AML rules and regulations.
The Peloton Group shall perform regular tests and assessments on the adequacy of its AML systems and controls and its overall ability on a continuing basis to identify, assess, monitor and manage money laundering and terrorist financing risk and to confirm that its systems and controls continue to be adequate and proportionate relative to the nature, scale, and complexity of its activities and shall otherwise ensure that the Peloton Group’s AML systems and controls shall remain fit for purpose and will include the following:
- Identification procedures, including appropriate accurate client / investor identification resulting from “Know Your Customer” processes.
- Verification of clients/investors using reliable documents that information are objective and independent in nature.
- Identification of beneficial ownership and control to determine the ultimate controller of any client or investor
- If client is a corporate undertake to under stand the nature of that client’s business
- Conduct ongoing due diligence and scrutiny of all clients, investors, and related transactions
- Client/Investor due diligence requirements or enhanced due diligence requirements shall be applied to any potential client/investor that presents a higher risk, including PEPs.
- Accredited Investor qualification confirmation
- Refreshed due diligence and Accredited Investor due diligence as may be warranted
- Establish and maintain adequate and sufficient record keeping procedures
- Establish and maintain internal reporting procedures.
- Independent audit of the Peloton Group AML policies, procedures, systems and controls; and
- Monitoring staff compliance with AML policies, procedures, systems, and controls, including periodic training. The AML Policy shall remain available to all staff and all staff shall remain familiar with its contents.
4. Money Laundering Reporting Officer
The Peloton Group shall appoint an Money Laundering Reporting Officer to be responsible for all AML policies, procedures, systems, controls, and activities within the Peloton Group, including ensuring that appropriate awareness and training is always available and provided to all staff (existing and new), and that such training is kept up to date such that it remains fit for purpose.
The Peloton Group reserves the right to perform enhanced due diligence which may include:
- a “blockchain” analysis to verify past transaction history,
- confirmation of cryptocurrency provenance,
- cross-checks against “blacklisted digital wallets”,
- review of any history or suspected history of transacting through known, or suspected, “mixer, tumbler or fogger” service providers.
- Pilot transfers, whereby the Peloton Group may conduct a small value transfer to client’s proposed wallet in order to confirm client’s control of said wallet.