AML/KYC Policy

LAST MODIFIED JULY 2024

Flypto Anti-Money Laundering and Know Your Customer Policy (hereinafter - the “AML/KYC Policy”) is designated to prevent and mitigate possible risks of Flypto being involved in any kind of illegal activity.

Both international and local regulations require Flypto to implement effective internal procedures and mechanisms to prevent money laundering, terrorist financing, drug and human trafficking, proliferation of weapons of mass destruction, corruption and bribery and to take action in case of any form of suspicious activity from its Users.

For Law Enforcement requests please direct your official document to our compliance team here.

AML/KYC Policy covers the following matters:

Verification procedures
Compliance Officer
Monitoring transactions
Risk assessment
Transaction rights

1. Verification procedures

One of the international standards for preventing illegal activity is Customer Due Diligence (“CDD”). According to CDD, Flypto establishes its own verification procedures within the standards of anti-money laundering and Know Your Customer “KYC” frameworks, including Enhanced Due Diligence “EDD” for Users presenting a higher risk, such as Politically Exposed Persons “PEPs”.

Flypto’s identity verification procedure requires the User to provide Flypto with reliable, independent source documents, data or information e.g., national ID, international passport, bank statement, utility bill. For such purposes, Flypto reserves the right to collect User’s identification information as determined by its Terms of Use and Privacy Policy.

Flypto will take steps to confirm the authenticity of documents and information provided by Users of all Services as defined under the Terms of Use and Privacy Policy. All legal methods for double-checking identification information will be used and Flypto reserves the right to investigate certain Users who have been determined to be risky or suspicious.

Flypto reserves the right to verify User’s identity in an on-going basis, especially when their identification information has been changed or User activity is deemed to be suspicious (unusual for the particular User). In addition, Flypto reserves the right to request up-to-date documents from Users despite having passed identity verification in the past.

User’s identification information will be collected, stored, shared and protected strictly in accordance with the Flypto’s Privacy Policy and related regulations.

Once the User’s identity has been verified, Flypto is able to remove itself from potential legal liability in a situation where its Services are used to conduct illegal activity.

Flypto is prohibited from transacting with individuals, companies, and countries that are on prescribed sanctions lists. Flypto will therefore screen against United Nations, European Union, UK Treasury, FATF and US Office of Foreign Assets Control (OFAC) sanctions lists in all jurisdictions in which we it operates.

2. Compliance Officer

The Compliance Officer is the person, duly authorized by Flypto, whose duty is to ensure the effective implementation and enforcement of the AML/KYC Policy. It is the Compliance Officer’s responsibility to supervise all aspects of Flypto’s anti-money laundering and counter-terrorist financing, including but not limited to:

2.1 collecting Users’ identification information;
2.2 establishing and updating internal policies and procedures for the completion, review, submission and retention of all reports and records required under the applicable laws and regulations;
2.3 monitoring transactions and investigating any significant deviations from normal activity;
2.4 implementing a records management system for appropriate storage and retrieval of documents, files, forms and logs;
2.5 updating risk assessment regularly;
2.6 providing law enforcement with information as required under the applicable laws and regulations.

The Compliance Officer is entitled to interact with law enforcement, which are involved in prevention of money laundering, terrorist financing, and any other illegal activity.

3. Monitoring transactions

The Users are known not only by verifying their identity (who they are) but, more importantly, by analyzing their transactional patterns (what they do). Therefore, Flypto relies on data analysis as a risk-assessment and suspicion detection tool(s). Flypto performs a variety of compliance-related tasks, including capturing data, filtering, record-keeping, investigation management, and reporting. System functionalities include:

3.1 daily check of Users against recognized “black lists” (e.g. OFAC);
3.2 aggregating transfers by multiple data points;
3.3 placing Users on watch and service denial lists;
3.4 opening cases for investigation where needed;
3.5 sending internal communications and filling out statutory reports;
3.6 case and document management.

With regard to the AML/KYC Policy, Flypto will monitor all transactions and it reserves the right to:

3.7 ensure that transactions of suspicious nature are reported to the proper law enforcement through the Compliance Officer;
3.8 request the User to provide any additional information and documents in case of suspicious transactions;
3.9 suspend or terminate a User’s Account when Flypto has reasonably determined suspicion that such User(s) are engaged or have engaged in illegal activity.

The above list is not exhaustive and the Compliance Officer will monitor Users’ transactions on a day-to-day basis in order to define whether such transactions are to be reported and treated as suspicious or are to be treated as bona fide.

4. Risk assessment

Flypto, in line with the international requirements, has adopted a risk-based approach to combating money laundering and terrorist financing. By adopting a risk-based approach, Flypto is able to ensure that measures to prevent or mitigate money laundering and terrorist financing are commensurate to the identified risks. This will allow resources to be allocated in the most efficient ways. The principle is that resources should be directed in accordance with priorities so that the greatest risks receive the highest attention.

5. Transaction Rights

Flypto reserves the absolute right to refuse to process, or to cancel, correct, clawback, hold or reverse, any cryptocurrency order (purchase/sell) at its sole discretion, even after funds have been debited from your Account in response to a subpoena, court order, or other government order, or if the Compliance Officer suspects that transaction may involve:

5.1 money laundering;
5.2 terrorist financing;
5.3 human trafficking or sexual exploitation;
5.4. fraud; or
5.5 any other type of financial crime.

In such instances, Flypto will cancel, correct, clawback, hold or reverse the transaction with no obligation to reinstate a cryptocurrency order (purchase/sell) at the same price or on the same terms as the affected transaction in question.