Policies for Verifying Identity (KYC), Anti Money Laundering Policy , and Monitoring Transactions
This Know Your Customer (“KYC”) and Anti-Money Laundering (“AML”) Policy (“KYC/AML Policy”) outlines the KYC and AML requirements for accessing and using our website https://cointrade.ae and mobile application (collectively “Platform”), operated under the brand name “CoinTrade”, which offers services of online trading of Crypto by facilitating the placement of sale and/or purchase orders of Users.
You acknowledge that You and CoinTrade have entered into a legally binding agreement through this KYC/AML Policy.
CoinTrade may, at any time and without prior written notice, alter, amend, add, or remove provisions of this KYC/AML Policy in its sole discretion. You are responsible for checking the KYC/AML Policy on a regular basis for modifications or updates.
If you continue using the Platform after the KYC/AML Policy has been updated, it will be assumed that you agree to the updated Policy. In accepting our KYC/AML Policy, you also agree to be bound by the Terms of Service and the Privacy Statement.
For the purposes of this KYC/AML Policy, You hereby provide your express consent to CoinTrade’s ongoing monitoring and collection of information and data about Your activity on our Platform.
1.1 “Applicable Law” means the Prevention of Money Laundering Act 2002 (“PMLA”), the Prevention of Money Laundering (Maintenance of Records) Rules 2005 (“PML Rules”), and any other applicable statute, law, regulation, ordinance, rule, judgement, order, decree, by-law, approval from the concerned authority, government resolution, order, directive, guideline, policy, requirement, or other governmental restriction in force in India.
1.2 “Crypto(s)” are virtual digital assets, and refer to a cryptographically secured digital representation of value or contractual rights that leverages distributed ledger technology and may be exchanged, stored, or traded electronically via the Platform, such as bitcoin (BTC) or Ether (ETH).
1.3 “Customer,” “User,” and “You” refer to any person who accesses or uses the Platform to engage in cryptocurrency trading.
1.4 “Customer Due Diligence” (CDD) refers to the process of determining who the customer is and then validating that identity through an objective third party.
A passport, driver’s license, Aadhaar card, or voter ID card issued by the Election Commission of India are all examples of 1.5 “Officially Valid Document/OVD.” According to the Aadhaar (Targeted Delivery of Financial and other Subsidies, Benefits, and Services) Act of 2016, “Aadhaar Number” refers to a unique identifier issued by the government of India.
For purposes of this definition, a “Person” is an Indian national or permanent resident who is at least eighteen (18) years old.
Governors, members of parliament, military officers, senior government and judiciary executives, and heads of local bodies such as municipal corporation boards are all examples of “Politically Exposed Persons” (PEPs) who are authorized to fulfill prominent public functions in a country. If you are a close relative or sibling of a PEP, you may also fall under this category.
Any transaction or attempted transaction on the Platform, whether or not using fiat currency, that, in CoinTrade’s sole discretion, gives rise to a reasonable ground of suspicion that it may involve proceeds of a crime/an offense, regardless of the value involved; or appears to be made in circumstances of unusual or unjustified complexity or in contravention of any Applicable Law; or appears to have no economic rationale; shall be deemed a “Suspicious Transaction.” Funds that are known or reasonably suspected to be acquired by a terrorist, a terrorist organisation, or those who finance or attempt to finance terrorism are considered to be part of a terrorist transaction.
When we refer to a “User Account” or “CoinTrade Account,” we’re referring to the account the User creates on the Platform via which the User provides CoinTrade with instructions for trading cryptocurrencies.
2) Know Your Customer Regulations
In accordance with Section 2.1, Know Your Customer, it is mandatory to verify the identity of anybody who creates or manages a User Account. “Know Your Customer” (KYC) refers to a method through which a business can ensure that its clients are who they say they are.
2.2 It is important that the customer’s identity be confirmed through the use of supporting documentation and information. The goals of Know Your Customer procedures include:
Keep an eye on unusual financial activity,
Ensure the prospective buyer is not an outstanding insolvent,
Reduce the likelihood of fraud,
Weed out troublesome clients and stay away from opening Benami accounts under bogus names and addresses.
Statements of Fact and Commitments
3.1 Statements and Information Revealed by the Platform
In accordance with Section 3.1.1, whether a User chooses to trade using the Platform or applies to be a Customer, CoinTrade will identify and verify the User’s identity. CoinTrade shall collect, and You, as the User, shall give, such documents and data as requested by CoinTrade from time to time to establish and verify the identity of the User / for KYC purposes / to establish and verify the nature of any Suspicious Transaction completed on the Platform. You agree that any information submitted by You in connection with Know Your Customer requirements, customer identification, or the Suspicious Transaction is complete, accurate, and current. CoinTrade may use or deploy various software, technology, or other means to establish and verify Your identity and/or the documents and information You submit, either directly or through its service providers and partners. You agree to such Know Your Customer (KYC) and identity verification processes.
As may be legally/operationally tenable, 3.1.3 CoinTrade shall make reasonable efforts to verify, either directly or through third-party vendors/service providers, the identity and address of the Users and the other details and documents submitted by You, including but not limited to the following methods:
In order to register and maintain your Platform Account, through which You may offer instructions on the Platform, You agree to provide the necessary papers and information for KYC checks in a timely way.
3.1.4 If You, as a User, fail to provide the necessary Know Your Customer (KYC) documents or any identity documents or information as asked by CoinTrade, Your ability to use the Platform and the related services may be hindered or restricted.
3.1.5 You accept and understand that CoinTrade may, at any time and without previous notice, modify the aforementioned list of documents, verification, and information by means of a notification/intimation, in its exclusive discretion.
You agree to cooperate fully with any investigation by CoinTrade into Your identity or financial situation, including the origin of any funds transferred to or received from Your Crypto wallet. 3.1.6 CoinTrade reserves the right to inspect or request additional information and documents to establish Your identity and financial position. If You do not or refuse to comply with these conditions, CoinTrade will not permit You to create or run the User Account or conduct Crypto transactions using the Platform.
Upon receipt of a written request from CoinTrade, you undertake to quickly provide such further documentation as may be necessary by CoinTrade to ensure compliance with any Applicable Laws or CoinTrade’s policies or a request from any law enforcement agencies.
Furthermore, you warrant and agree that the KYC materials you supply to CoinTrade or its delegates, agents, or representatives will be truthful, correct, and complete.
In the event that CoinTrade, in its sole discretion, deems a transaction or series of transactions conducted by You to be Suspicious Transaction(s) or reasonably suspects that they involve or are intended for use in connection with the proceeds of crime or any illegal activity, or if CoinTrade receives requests/requisitions from any banking partner/payment system provider or participant/statutory/regulatory/supervisory/law enforcement authority/enforcement a, CoinTrade will be required to User agrees and warrants that they will offer any and all assistance, support, and cooperation necessary, including the provision of any additional documentation necessary to authenticate User’s identification or the specifics of any transaction.
3.1.10 CoinTrade does not permit the opening or maintenance of any anonymous User Accounts, the creation of any accounts under fictitious names, the creation of any accounts on behalf of other persons whose identity has not been disclosed or cannot be verified, or the creation of more than one (1) account for a person.
To Whom It May Concern:
You agree that your usage of the Platform will be in compliance with all applicable laws, this KYC/AML Policy (as may be updated from time to time), and any other applicable policies or guidelines.
You agree that you will not use the Platform for any illegal or unlawful or criminal or anti-national purposes, or to finance any such action, under any circumstances.
3.2.3 You must not pretend to be someone else or give false information about who you are when using the Service.
3.2.4 You represent and warrant that you will not engage in Benami transactions or any other transactions that are contrary to any Applicable Laws, this Policy, or any other policy or instruction as provided by CoinTrade from time to time.
Acceptance Procedure for Customers (CAP)
How to Create an Account, Section 4.1
4.1.1 Any citizen or permanent resident of India can sign up for a CoinTrade Account, however such an account can only be used within India’s borders.
To activate their CoinTrade Account, Users must supply the following information:
Documents for identification and evidence of habitation (Aadhaar/Voter ID/Passport), c. Real-time selfie from the camera a. Permanent Account Number (PAN) issued by Income Tax Authorities
Please note that in order to make INR deposits and withdrawals after the account has been opened, the User must add and verify their bank account/UPI ID.
4.1.3 While the preceding information/documents could be used to verify the account holder’s identification, they wouldn’t be enough to create a complete profile of their likely CoinTrade Account behaviour. For this purpose, it may be necessary to gather the following information while creating a CoinTrade Account:
The questions asked are as follows: (a) Annual Income (b) Profession (c) If Politically Exposed Person (PEP) (d) Trading Experience (e) Marital Status
Only once such documents, information as indicated above, or any other additional information as requested by CoinTrade has been confirmed to the satisfaction of CoinTrade will the User’s CoinTrade Account become active for the User to partake of our services.
4.2 CoinTrade will keep a record of all file transfers (uploads, edits, and downloads).
Measures the Platform Takes for Security
We use reasonable attempts to verify that a user is not using a pseudonym or a fictitious/benami name when they sign up for a CoinTrade Account.
If we are unable to apply appropriate CDD measures, i.e., verify the User identity and/or obtain documents required or the non-reliability of the documents/information furnished to CoinTrade, then no CoinTrade Account is made operational, and the User is not allowed to avail our services.
The Customer Due Diligence (CDD) process is followed prior to the opening of any account or the execution of any trades.
4.3.2 Users may only use the CoinTrade platform for their own account, with their own cash, and for their own gain, and may not act on behalf of another User. Users are not allowed to sign up for services using a pseudonym, a false name, or on behalf of another user whose identity is unknown or cannot be verified.
User agrees that CoinTrade may, in its sole discretion, review User’s CoinTrade Account and transactions for any Suspicious Transactions or in the event that CoinTrade receives a request for the same from Authorities, and that such CoinTrade Account may be suspended, frozen, blocked, disabled, or terminated based on CoinTrade’s judgement or instruction from Authorities.
If CoinTrade is unable to ensure compliance with any of the foregoing conditions, either because the User is not cooperating or because the details provided by the User are found to be enlisted on any Sanctions Lists or unreliable or unverifiable to CoinTrade’s satisfaction, CoinTrade may, in its sole discretion, refuse to open any new accounts, suspend or terminate existing User Accounts after giving due notice, or refuse to process any transactions on the Platform.
4.3.5 Obligations and requirements imposed by international agreements, as well as messages from relevant international bodies CoinTrade shall take all reasonable measures to prevent the opening of any account in the name of any person or entity included on any of the lists of persons or entities suspected of having ties to terrorism that are approved by and periodically circulated by the United Nations Security Council (UNSC), other watchlists, or sanctions lists.
Fifthly, the Identifying the Client Process (CIP)
CoinTrade’s Know Your Customer (KYC) and data/information gathering rules have proper Customer Identification as one of its goals. Performing Customer Due Diligence (CDD) is synonymous with identifying a customer. Any time a User executes a transaction on or via the Platform, CoinTrade may need that User to provide information that will allow it to verify the User’s identity and the nature of the transaction.
The Customer Identification Procedure is carried out at various stages during the User’s access to the Platform, including but not limited to: a. registering a User’s Platform Account, b. reviewing a User’s Platform Account on a periodic basis, c. executing any transaction on the Platform, and/or d. when the Platform has doubts about the authenticity/veracity or the adequacy of the previously obtained User Identification data.
5.1 Authentication of the User
Users must provide valid identification information in order to create a CoinTrade Account. If CoinTrade is unable to complete its verification and due diligence of a User, then that User will not be permitted to create an Account on the Platform.
The Meaning of Identity (5.1.1)
In common usage, the term “identity” refers to the collection of details that can be used to single out a specific “natural” or “legal” person. Identifiers are the characteristics of a “natural” or “legal” person that help to establish their individuality. Identifiers can be split into two categories: two levels: (a)first, and (b)secondary.
Address, place of residence, country of origin, and similar information are all examples of secondary identifiers that can be used to get a more precise picture of a person’s identity. User identification is not a one-and-done process, but rather an ongoing one.
The Importance of Identification (5.1.2)
When someone is identified, they have had their identity confirmed.
To do CDI, the following information must be gathered from a potential business partner before forming a connection with them: c. Permanent Account Number (PAN) or the equivalent e-PAN, and (ii)Certified copy of an Officially Valid Document (OVD) or the equivalent e-document thereof containing the details of identity and address, respectively, are the features to verify and the documents to obtain, respectively, when establishing a person’s identity. Officially Valid Documents (OVDs) include, but are not limited to, passports, Aadhaar cards, voter ID cards, and any other documents deemed necessary by CoinTrade at any time and at its sole discretion.
5.1.3 Exactly what Does the Term “Verification” Mean?
The term “identity verification” refers to the process of checking if a person is who they say they are. When it comes to Know Your Customer procedures, “verification” refers to the steps used to confirm the customer’s identification using appropriate documentation. This is accomplished by verifying the accuracy of the customer’s input.
Methodology for the Video Know-Your-Customer Step 5.1.4
A video-KYC may be requested from a User to authenticate their identity and the legitimacy of the document/ information presented in cases where the document provided by the User has certain difficulties and cannot be checked using the automated solutions CoinTrade has in place. When additional screening is called for, we plan to use video for the Know Your Customer (KYC) procedure.
5.1.5 Ongoing Know Your Customer (KYC) Updates
CoinTrade, in its sole discretion, determines the frequency of updating Users’ Know Your Customer (KYC) information and the associated processes and documents. The Know Your Customer (KYC) process is to be periodically updated based on risk:
If the only thing that’s changed is the User’s address, CoinTrade can get a self-declaration of the new address from the User via the email id and mobile number that the User has on file with CoinTrade, as well as convincing confirmation that the User has moved.
In the event that the User’s contact information (such as their phone number or email address) changes, the User can contact CoinTrade to have their details updated by providing acceptable proof of the change and providing evidence of ownership of the relevant CoinTrade Account.
Subclasses of CDD
Customer Due Diligence (CDD) can be one of two varieties utilised depending on the customer’s risk level.
In order to establish the User’s identity, Basic Due Diligence necessitates collecting and verifying the User’s identity proof, address proof, and a photograph. This is accomplished by reviewing the User’s supplied paperwork and details.
5.2.1 Additional steps are taken beyond those of BDD to complete what is known as Enhanced Due Diligence (EDD). EDD measures may include, but are not limited to, investigating whether or not a User is a Politically Exposed Person (PEP), determining whether or not the User is affiliated with a terrorist organisation, and monitoring the accounts of PEPs and potentially PEPs.
When a user registers for or uses the Platform, CoinTrade will carry out any Basic Due Diligence, EDD, or other due diligence activity or measures are necessary in its sole judgement and/or under Applicable Laws.
6 Precautions Against Money Laundering
Regulated Entities (REs) are required to identify customers, establish a relationship with them through an account or otherwise, and keep tabs on their transactions in accordance with the provisions of the Prevention of Money-Laundering Act, 2002 and the Prevention of Money-Laundering (Maintenance of Records) Rules, 2005, as amended from time to time. Despite the fact that CoinTrade is not a RE, the company has voluntarily implemented KYC/AML/CFT procedures in accordance with the aforementioned Act and Rules.
For its part, CoinTrade is constantly on the lookout for ways to combat money laundering, and it has put in place procedures to ensure that the Platform is not used to launder money or fund terrorism.
6.1 Measures to Prevent Money Laundering and the Financing of Terrorism
CoinTrade has taken measures to thwart the launder of funds and the funding of terrorism. Such procedures are all-encompassing and may be updated as necessary to comply with any Applicable Law and/or as determined by CoinTrade in its sole discretion.
Continuous Transaction Monitoring 7. Do Your Research
7.1 Constantly keeping an eye on your CoinTrade Account and being ready to act swiftly if any suspicious activity is uncovered is crucial.
7.2 CoinTrade shall monitor a User’s CoinTrade Account actions conducted through the Platform as part of its continuous due diligence process to reasonably verify that they are consistent with their understanding of the User, its risk profile, and, if necessary, the source of funds.
7.3 CoinTrade may review the due diligence measures, including reverifying Your identity, and may request additional information if there are suspicions of money laundering or financing of activities related to terrorism, or if there are doubts about the adequacy or veracity of previously obtained User identification data. You, the User, hereby confirm that You will, upon CoinTrade’s request, give all such information.
7.4 Knowing their consumers, assessing risk, and ensuring CoinTrade is not being used for financial crime are all made easier by keeping tabs on their behaviour and transactions throughout the partnership. Nonetheless, the level of scrutiny applied must be commensurate with the customer’s level of risk. More careful attention must be paid to high-risk accounts.
CoinTrade may, in its sole discretion, freeze or suspend any CoinTrade Account or User access may be blocked or terminated based on monitoring operations done by CoinTrade as outlined under this Policy, including, but not limited to, the following types of transactions:
Inconsistent activity level between the size of the balance and the frequency with which it is withdrawn a.
7.6 CoinTrade may activate alerts when transactions don’t match the risk category, and the customer’s updated profile will be used to effectively identify and report suspicious transactions.
8.1 CoinTrade has designated a ‘Principal / Compliance Officer’ who is responsible for overseeing the company’s compliance with all applicable legal requirements and the terms of this Agreement. Mr. Shiva Tadikonda is our Compliance Officer right now, and he may be reached at cs-compliance@CoinTrade.ae .
8.2 If you have any questions or concerns about this Policy, or if you become aware of any suspicious or illegal behavior on the part of a User, please contact us at cs-compliance@CoinTrade.ae
Reviewing and Assessing Risk on a Regular Basis
A customer’s identification is required as a mandatory step in opening an account. Failure to do so carries the potential for adverse consequences, such as the occurrence of fraudulent transactions, the transfer of illicit funds, accidental overdrafts, and the opening of Benami or fictional accounts.
Intentional splitting/structuring of transactions to escape taxes, money laundering, and financing of terrorist operations may occur if monitoring of transactions beyond the threshold limit is not strictly enforced and transactions are not recorded.
CoinTrade reserves the right to conduct periodic “Money Laundering (ML) and Terrorist Financing (‘TF’) Risk Assessments” to identify, assess, and take effective measures to mitigate money laundering and terrorist financing risk for Users, countries or geographic areas, and products, services, transactions, or delivery channels, in a manner consistent with any national risk assessment conducted by a body or authority duly notified by the Central Government.
CoinTrade classifies its Users as low, medium, or high risk based on its own evaluation and risk assessment, as is standard procedure in the industry and within the scope of its exclusive discretion. Using the customer’s identity, social/financial standing, and the type of the business activity, CoinTrade will classify the customer’s level of risk.
In order to keep all User Accounts up-to-date with regards to their relative level of risk, you should do so on a regular basis. At present, the frequency of such update should not be less than once every five (5) years in the case of low-risk category customers, and not less than once every two (2) years in the case of high- and medium-risk categories, unless otherwise required under this Policy or under Applicable Law or for complying with any request of Authorities. CoinTrade may, at any moment and from time to time, alter the aforementioned frequency, as it sees fit.
9.7 CoinTrade may, in its sole discretion, classify each customer as low, medium, or high risk, relying on their knowledge and experience in consumer profiling as well as their knowledge, judgement, assessment, and risk perception of the individual customer.
CoinTrade’s risk assessment shall: a. be reasonably documented; b. take into account all relevant risk factors prior to determining the level of overall risk and the appropriate level and type of mitigation to be applied; c. be kept current; and d. be made available to competent authorities and self-regulating bodies/Authorities, if and as required under Applicable Laws.
9.9 Regularly updated know-your-customer (KYC) policies
CoinTrade, in its sole discretion, determines the frequency of updating Users’ Know Your Customer (KYC) information and the associated processes and documents. It is recommended to employ a risk-based strategy to update KYC on a regular basis, as per the mentioned frequency.
In the event that only the User’s address data change, CoinTrade will contact the User via the email id and mobile number on file in order to collect a self-declaration of the new address, as well as valid documentation to be supplied by the User for the change in such address.
If the User’s contact information (such as phone number or email address) changes, the User should contact CoinTrade to have their account updated.
The User must contact CoinTrade to update their details and provide valid proof of change if any of the information provided during onboarding or periodic updates has changed. This can be done by sending an email to cs-compliance@CoinTrade.co.
Controls Within the Organization (10)
Managing Records and Keeping Historical Documents 10.1
All identity and due diligence information received by CoinTrade shall be used in line with CoinTrade’s applicable terms and conditions, and CoinTrade shall make reasonable efforts to ensure that this occurs. CoinTrade must also take all reasonable measures required for the maintenance, preservation, and reporting of User information in accordance with CoinTrade’s internal policies and standard operating procedures.
In addition, any User information acquired or created by CoinTrade shall be kept confidential, secure, and protected against access, use, and disclosure (including publication or display) in accordance with Applicable Law.
As required by the Applicable Laws/good industry standards, 10.1.3 CoinTrade shall collect and preserve records (in book form or electronically) of Your identification proof along with all documents and information given by You and of all transactions completed by You on the Platform.
10.1.4 CoinTrade shall keep records of: a. the KYC details, documents, and data of all Users who open a User’s Platform Account on the Platform; b. the KYC details, documents, and data of all Users who undertake a transaction on the Platform; or c. Your transactions on the Platform, and report them to the Authorities upon request.
10.2 Upon request, CoinTrade will provide the appropriate authorities with access to customer identifying records and transaction details.
10.3 If CoinTrade: a. has reason to believe that a transaction involves ML or TF; or b. has reason to doubt the adequacy or veracity of previously obtained identification data, CoinTrade will take the appropriate actions to review the due diligence measures taken by the Platform or the information obtained (on the purpose and intended nature of the business relationship) from the User.
Hiring Personnel 10.4
They must implement proper screening processes as an integral element of their personnel recruitment/hiring process to guarantee high standards and fair treatment for all applicants.
Tenth Modifier: Training Employees
In order to ensure that all relevant personnel have received proper training in KYC/AML/CFT policy, it is mandated that a number of training programmes be implemented at the company (10.5.1). A company’s frontline workers, compliance officers, risk managers, auditors, and employees who often interact with new clients may all benefit from training with a slightly different emphasis. Front desk employees are prepared to address concerns that may arise due to customers’ lack of knowledge. Adequate personnel in the audit function who are knowledgeable about and trained in KYC/AML/CFT policies, regulations, and related concerns also contribute to successful implementation. Online courses have been implemented to raise consciousness.
10.5.2 CoinTrade may establish policies and FAQs in order to answer any questions or concerns Users may have in furtherance of the Policy.
10.5.3 We’ve worked hard to make sure this Policy follows all relevant regulations. If any provision of this Policy is held to be invalid or unenforceable, such invalidity or unenforceability shall not impact the remainder of this Policy. Other than the data collected by CoinTrade through the Platform, this Policy does not apply to any other data.
Attachment 1: Know Your Customer and Anti-Money Laundering Regulations Rules of Thumb
Do: Before approving a new account, RBI verifies that the account holder’s information does not match that of a known criminal or an entity on the list of individuals and organisations barred from conducting financial transactions by the United Nations Security Council Sanctions Committee.
Customer provided document copies must be photographs or electronic pictures of the originals.
The PAN must be validated at the issuing government’s verification centre.
All questionable financial activity needs to be closely watched.
We pay extra close attention to all complex, typically substantial transactions that serve no economic or legal purpose and that are associated with high-risk accounts.
Every new customer needs to be assigned a risk level, either low, medium, or high, so that their account can be monitored appropriately. A regular examination of consumers’ risk profiles is recommended.
Every customer’s Know Your Customer (KYC) data (including photos) should be regularly updated.
Don’ts: Never use a benami, fictional, or anonymous name while creating an account (s).
Do not create an account if CoinTrade cannot perform enough Customer Due Diligence (CDD) due to the customer’s unwillingness to cooperate or the unreliability of the customer’s provided documents/information.
Do not open an account without your PAN and a valid form of identification.
The people at large, and especially the economically or socially disadvantaged, should not be denied access to services.
While suspicious activity may have been spotted in certain accounts, those accounts’ normal functions will continue unimpeded and the consumers will remain in the dark.