anti-money laundering and anti-terrorist financing compliance manual

68 Pages·2015·0.89 MB·English

ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL
www.xpressmoney.com

XXPPRREESSSS MMOONNEEYY SSEERRVVIICCEESS
((CCAANNAADDAA)) LLTTDD..
XAPARENNSS MTTONIIE--YMM SEROVOICENNS (CEEANYAYDA) LTD.
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING
LLAAUUNNDDEERRIINNGG

AANNDD
COMPLIANCE MANUAL
AANNTTII--TTEERRRROORRIISSTT
(Version 1.8, Effective 28th March 2017)
FFIINNAANNCCIINNGG
COMPLIANCE MANUAL
(Version 1.8, Effective 28th March 2017)

MANUAL UPDATED BY BLAKES
RESTRICTED © 2017 XPRESS MONEY
1
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

VERSION CONTROL
TABLE OF CONTENTS
VERSION DATE PREPARATION APPROVAL SUMMARY OF UPDATES
Prepared by Inderpal Approved by-Mr. The major changes were made
OVERVIEW .........................................S.i.n.g..h. .B.h..a.r.a..j.................S.a..n.t.h.o..s.h. .K..J............t.o. .a.c..c.e.p..t. I.D.. f.o..r. e..v.e.r.y.. t.r.a.n..s.a.c. t3io n
V 1.4 August 1st,2013
(Chief Compliance (VP Global operations & when we opened an account with
ROLES AND RESPONSIBILITIES OOFffi Ace Cr- COaMnadPaL)IANCE OCFomFpICliaEncRe) ........................IC..I.C..I .b.a..n.k........... 6
RISK ASSESSMENT .......................................................A..p..p.r.o.v..e.d.. b..y.-.M..r.. .......................................... 8
Prepared by Inderpal
Santhosh KJ The major changes were made in
V 1.6 December 22nd,2014 Singh Bharaj-CCO
FINTRAC REGISTRATION/AGENT LIST ...................(.V..P. .G..lo..b.a..l .o.p..e.r.a..ti.o..n.s. .&.. ...........b.u..s.in..e.s.s.. r.e..la..ti.o..n.s.h..ip... 14
Canada
Compliance)
REPORTING REQUIREMENTS ................................................................................................ 15
The major changes are made
Prepared by Inderpal
EFT TRAVEL RULE .....................................................A..p.p..ro..v.e..d. .b.y.. -.B..o.a..r.d. .o.f. .........i.n. .N..o.n.. f.a..c.e. .t.o. .f.a.c.e../.o.n..li.n 2e 3
V 1.8 March 28th,2017 Singh Bharaj-CCO
Directors transactions, domestic PEP and
Canada
R ECORD KEEPING REQUIREMENTS ................................................................ri.s.k.. a..s.s.e..s.s.m..e..n.t..... 24
IDENTIFICATION RECORDS .................................................................................................... 30
TABLE OF CONTENTS
BUSINESS RELATIONSHIPS & ONGOING MONITORING ...................................................... 33
POLITICALLY EXPOSED FOREIGN PERSON ......................................................................... 37
OVERVIEW .................................................................................................................................. 3
RECORD RETENTION .............................................................................................................. 40
ROLES AND RESPONSIBILITIES OF A COMPLIANCE OFFICER ............................................ 6
PENALTIES ................................................................................................................................ 41
RISK ASSESSMENT .................................................................................................................... 8
“KNOW YOUR CUSTOMER” POLICY ....................................................................................... 42
FINTRAC REGISTRATION/AGENT LIST .................................................................................. 14
ON-GOING COMPLIANCE TRAINING PROGRAM ................................................................... 43
REPORTING REQUIREMENTS ................................................................................................ 15
ON-GOING COMPLIANCE REVIEWS ....................................................................................... 44
EFT TRAVEL RULE ................................................................................................................... 23
HIRING AND MONITORING STAFF AND AGENTS ................................................................. 45
RECORD KEEPING REQUIREMENTS ..................................................................................... 24
SCHEDULE A ............................................................................................................................. 46
IDENTIFICATION RECORDS .................................................................................................... 30
SCHEDULE B ............................................................................................................................. 47
BUSINESS RELATIONSHIPS & ONGOING MONITORING ...................................................... 33
SCHEDULE C ............................................................................................................................. 49
POLITICALLY EXPOSED FOREIGN PERSON ......................................................................... 37
SCHEDULE D ............................................................................................................................. 50
RECORD RETENTION .............................................................................................................. 40
SCHEDULE E ............................................................................................................................. 52
PENALTIES ................................................................................................................................ 41
SCHEDULE F - 1 ........................................................................................................................ 57
“KNOW YOUR CUSTOMER” POLICY ....................................................................................... 42
SCHEDULE F - 2 ........................................................................................................................ 58
ON-GOING COMPLIANCE TRAINING PROGRAM ................................................................... 43
SCHEDULE G ............................................................................................................................ 59
ON-GOING COMPLIANCE REVIEWS ....................................................................................... 44
SCHEDULE H ............................................................................................................................. 63
HIRING AND MONITORING STAFF AND AGENTS ................................................................. 45
SCHEDULE I .............................................................................................................................. 64
SCHEDULE A ............................................................................................................................. 46
QUEBEC ADDENDUM TO AML/ATF COMPLIANCE MANUAL ................................................ 65
SCHEDULE B ............................................................................................................................. 47

SCHEDULE C ............................................................................................................................. 49
SCHEDULE D ............................................................................................................................. 50
SCHEDULE E ............................................................................................................................. 52

SCHEDULE F - 1 ........................................................................................................................ 57
SCHEDULE F - 2 ........................................................................................................................ 58
SCHEDULE G ............................................................................................................................ 59

SCHEDULE H ............................................................................................................................. 63

S CHEDULE I .............................................................................................................................. 64

QUEBEC ADDENDUM TO AML/ATF COMPLIANCE MANUAL ................................................ 65

2
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

TABLE OF CONTENTS OVERVIEW
OVERVIEW .................................................................................................................................. 3
This manual states the policies and procedures implemented by Xpress Money Services
ROLES AND RESPONSIBILITIES OF A COMPLIANCE OFFICER ............................................ 6 (Canada) Ltd. (“Xpress Money”) to detect and prevent money laundering and terrorist
financing activities in respect of its Canadian business. The purpose is to assist Xpress Money,
RISK ASSESSMENT .................................................................................................................... 8
its agents and employees to comply with Canadian anti-money laundering and anti-terrorist
FINTRAC REGISTRATION/AGENT LIST .................................................................................. 14
financing (“AML/ATF”) legislative requirements. It is also intended to act as a basis for Xpress
REPORTING REQUIREMENTS ................................................................................................ 15 Money’s ongoing review, development and documentation of the policies and procedures
required under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its
EFT TRAVEL RULE ................................................................................................................... 23
regulations.
R ECORD KEEPING REQUIREMENTS ..................................................................................... 24
Money Laundering
IDENTIFICATION RECORDS .................................................................................................... 30
TABLE OF CONTENTS
BUSINESS RELATIONSHIPS & ONGOING MONITORING ...................................................... 33 The United Nations defines money laundering as “any act or attempted act to disguise the
POLITICALLY EXPOSED FOREIGN PERSON ......................................................................... 37 source of money or assets derived from criminal activity”. Essentially, money laundering is the
OVERVIEW .................................................................................................................................. 3
process whereby “dirty money” – produced through criminal activity – is transformed into “clean
RECORD RETENTION .............................................................................................................. 40
ROLES AND RESPONSIBILITIES OF A COMPLIANCE OFFICER ............................................ 6 money”, the criminal origin of which is difficult to trace.
PENALTIES ................................................................................................................................ 41
RISK ASSESSMENT .................................................................................................................... 8
Money Laundering is not limited to cash or currency. Any type of funds can be laundered,
“KNOW YOUR CUSTOMER” POLICY ....................................................................................... 42
FINTRAC REGISTRATION/AGENT LIST .................................................................................. 14 including wire transfers, payments into or out of consignment accounts, the receipt of bank
ORENP-GOORITNIGN GC ORMEQPULIIARNECMEE NTRTSA I.N..I.N...G... .P..R...O..G...R...A..M... ...................................................................................................................................... 4135 cheques, personal cheques, money orders, travellers’ cheques or payments made by
international drafts. There are three recognized stages to the money laundering process.
ON-GOING COMPLIANCE REVIEWS ....................................................................................... 44
EFT TRAVEL RULE ................................................................................................................... 23
HIRING AND MONITORING STAFF AND AGENTS ................................................................. 45
RECORD KEEPING REQUIREMENTS ..................................................................................... 24 • Placement involves placing the proceeds of crime in the financial system.
SCHEDULE A ............................................................................................................................. 46 • Layering involves converting the proceeds of crime into another form and creating
IDENTIFICATION RECORDS .................................................................................................... 30
complex layers of financial transactions to disguise the audit trail and the source and
SCHEDULE B ............................................................................................................................. 47
BUSINESS RELATIONSHIPS & ONGOING MONITORING ...................................................... 33
ownership of funds. This stage may involve transactions such as the buying and
SCHEDULE C ............................................................................................................................. 49
POLITICALLY EXPOSED FOREIGN PERSON ......................................................................... 37 selling of securities, commodities or property.
SCHEDULE D ............................................................................................................................. 50 • Integration involves placing the laundered proceeds back in the economy to create
RECORD RETENTION .............................................................................................................. 40
the perception of legitimacy.
SCHEDULE E ............................................................................................................................. 52
PENALTIES ................................................................................................................................ 41
S“KCNHOEWD UYLOEU FR - C 1U ..S...T..O...M...E..R...”. .P..O...L..I.C...Y.. .............................................................................................................................................................................. 5472 Terrorist Financing
SCHEDULE F - 2 ........................................................................................................................ 58
ON-GOING COMPLIANCE TRAINING PROGRAM ................................................................... 43
“Terrorist financing provides funds for terrorist activity. The main objective of a terrorist activity is
SOCNH-GEODIUNLGE CGO .M...P...L..I.A..N...C..E... .R..E...V..I.E..W....S.. .............................................................................................................................................................................. 5494 to intimidate a population or compel a government to do something. This is done by intentionally
SCHEDULE H ............................................................................................................................. 63 killing, seriously harming or endangering a person, causing substantial property damage that is
HIRING AND MONITORING STAFF AND AGENTS ................................................................. 45
likely to seriously harm people or by seriously interfering with or disrupting essential services,
SCHEDULE I .............................................................................................................................. 64
SCHEDULE A ............................................................................................................................. 46 facilities or systems.” (From FINTRAC Guideline 1, June 23, 2008.)
QUEBEC ADDENDUM TO AML/ATF COMPLIANCE MANUAL ................................................ 65
SCHEDULE B ............................................................................................................................. 47
There are two primary sources of financing for terrorist activities:

SCHEDULE C ............................................................................................................................. 49
SCHEDULE D ............................................................................................................................. 50 • Obtaining financial support from countries, governments, organizations or
individuals;
SCHEDULE E ............................................................................................................................. 52
• Revenue-generating activities including criminal acts, legitimately earned income or

SCHEDULE F - 1 ........................................................................................................................ 57 donations to non-profit organizations involved in terrorist financing networks.
SCHEDULE F - 2 ........................................................................................................................ 58
SCHEDULE G ............................................................................................................................ 59

SCHEDULE H ............................................................................................................................. 63

S CHEDULE I .............................................................................................................................. 64

QUEBEC ADDENDUM TO AML/ATF COMPLIANCE MANUAL ................................................ 65

3
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

The sums needed are not always large and the associated transactions are not necessarily
complex. When funds are generated from illegal sources, terrorist groups may launder these
funds so that they can be used without drawing the attention of authorities. Transactions related
to terrorist activity financing may be similar to those related to money laundering.
Xpress Money will not knowingly allow its facilities to be used for the
laundering of funds or the financing of terrorist activity. Penalties for
money laundering are very severe including civil and criminal fines and
imprisonment. Xpress Money’s existence as a business could be placed in
jeopardy if money laundering or terrorist financing activities were to occur.
Therefore, all Xpress Money employees and agents dealing in any manner
with any customers, their transactions or their records concerning same,
must have a clear understanding of the requirements of this manual. All
such, Xpress Money employees and agents in Canada must read this
manual in its entirety.
Xpress Money has appointed a North American compliance officer whose primary duty is to
ensure the effective implementation and enforcement of the policies set forth in this manual in
respect of Canadian operations. Xpress Money will conduct periodic training programs on
Xpress Money’s AML/ATF policies and procedures. Xpress Money will also conduct random
and scheduled independent audits to verify compliance with its AML/ATF policies and
procedures.
Xpress Money intends to maintain the highest possible compliance with all AML/ATF laws and
regulations, including compliance with all reporting and record keeping laws as well as
recognizing and reporting suspicious transactions and attempted suspicious transactions.
Xpress Money’s board of directors are fully committed to complete compliance with all AML/ATF
laws and regulations and expects and will require a similar level of commitment from all of its
officers, employees, agents and representatives. Specifically, the board of directors will ensure
a Compliance Regime is in place, appoint a Compliance Officer, participate in annual AML
training and in general, ensure it is kept apprised of ongoing AML activity within the
organization.
The Proceeds of Crime (Money Laundering) and Terrorist Financing Act
The Proceeds of Crime (Money Laundering) and Terrorist Financing Act (“PC Act”) and its
regulations (Regulations) implement specific measures to detect, deter, investigate and
prosecute money laundering and terrorist financing offences in Canada. The specific measures
include: mandatory reporting of suspicious and prescribed transactions; the establishment of a
compliance program to ensure that the requirements of the legislation are followed; record
keeping and client identification; cross-border currency reporting; and registration of certain
prescribed businesses. The PC Act also established the Financial Transactions and Reports
Analysis Centre of Canada (“FINTRAC”) as the agency responsible for the collection, analysis
and disclosure of information to assist in the detection, prevention and deterrence of money
laundering and terrorist financing in Canada and abroad. FINTRAC also has responsibility for
ensuring compliance by financial intermediaries and other reporting entities with their obligations

4
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

The sums needed are not always large and the associated transactions are not necessarily under the PC Act and Regulations. FINTRAC publishes Guidelines and Interpretation Notices
complex. When funds are generated from illegal sources, terrorist groups may launder these on its website:
funds so that they can be used without drawing the attention of authorities. Transactions related
to terrorist activity financing may be similar to those related to money laundering. http://www.fintrac-canafe.gc.ca/
Xpress Money will not knowingly allow its facilities to be used for the PC Act Directives
laundering of funds or the financing of terrorist activity. Penalties for
money laundering are very severe including civil and criminal fines and Part 1.1 of the PC Act allows the Minister of Finance to issue directives (each a “Directive”)
imprisonment. Xpress Money’s existence as a business could be placed in requiring money services businesses such as Xpress Money, and others, to take prescribed
jeopardy if money laundering or terrorist financing activities were to occur. measures in respect of transactions originating from or bound for any foreign state. Directives
Therefore, all Xpress Money employees and agents dealing in any manner may be issued in respect of foreign states that the Minister believes have insufficient or
with any customers, their transactions or their records concerning same, ineffective anti-money laundering measures which could have an adverse effect on the
must have a clear understanding of the requirements of this manual. All Canadian financial system. These Directives may include measures that specify:
such, Xpress Money employees and agents in Canada must read this
manual in its entirety. • The requirement to verify the identity of any person or entity;
• The requirement to exercise customer due diligence, including ascertaining the
Xpress Money has appointed a North American compliance officer whose primary duty is to source of funds, the purpose of the transaction or the beneficial ownership of control
ensure the effective implementation and enforcement of the policies set forth in this manual in of any entity;
respect of Canadian operations. Xpress Money will conduct periodic training programs on • The monitoring of any financial transaction or account;
Xpress Money’s AML/ATF policies and procedures. Xpress Money will also conduct random • Keeping and retaining specified records;
and scheduled independent audits to verify compliance with its AML/ATF policies and • Reporting on specified transactions to FINTRAC; and
procedures. • A prohibition or limitation on undertaking or facilitating, directly or indirectly, certain
financial transactions.
Xpress Money intends to maintain the highest possible compliance with all AML/ATF laws and
regulations, including compliance with all reporting and record keeping laws as well as
When any Directive is issued, a new Schedule shall be added to this Compliance Manual
recognizing and reporting suspicious transactions and attempted suspicious transactions.
specifying the requirements applicable to Xpress Money. Xpress Money shall comply with all
requirements in the added Schedule. In the event of any inconsistency between a Directive
Xpress Money’s board of directors are fully committed to complete compliance with all AML/ATF
issued under the PC Act and any PC Regulations, Xpress Money shall comply with the
laws and regulations and expects and will require a similar level of commitment from all of its
Directive, to the extent of the inconsistency or conflict.
officers, employees, agents and representatives. Specifically, the board of directors will ensure
a Compliance Regime is in place, appoint a Compliance Officer, participate in annual AML

training and in general, ensure it is kept apprised of ongoing AML activity within the
organization.
The Proceeds of Crime (Money Laundering) and Terrorist Financing Act
The Proceeds of Crime (Money Laundering) and Terrorist Financing Act (“PC Act”) and its
regulations (Regulations) implement specific measures to detect, deter, investigate and
prosecute money laundering and terrorist financing offences in Canada. The specific measures
include: mandatory reporting of suspicious and prescribed transactions; the establishment of a
compliance program to ensure that the requirements of the legislation are followed; record
keeping and client identification; cross-border currency reporting; and registration of certain
prescribed businesses. The PC Act also established the Financial Transactions and Reports
Analysis Centre of Canada (“FINTRAC”) as the agency responsible for the collection, analysis
and disclosure of information to assist in the detection, prevention and deterrence of money
laundering and terrorist financing in Canada and abroad. FINTRAC also has responsibility for
ensuring compliance by financial intermediaries and other reporting entities with their obligations

5
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

ROLES AND RESPONSIBILITIES OF A COMPLIANCE
OFFICER
The compliance officer is responsible for the day-to-day compliance by Xpress Money with the
PC Act. The compliance officer will be instrumental in the development and conformity of
Xpress Money’s compliance policies and procedures and in the development and maintenance
of an ongoing compliance-training program for employees and agents.
Xpress Money has appointed Mr. Inderpal Singh Bharaj to be its Chief Compliance Officer (the
“Chief Compliance Officer”). The contact details for Mr. Inderpal Singh Bharaj are as follows:
7025 Tomken Road, Suite 237
Mississauga, ON L5S 1R6
Tel: [phone] | Fax: [phone]
Email: [email protected]
The compliance officer’s primary duty is to ensure the effective implementation and enforcement
of the policies set forth in Xpress Money’s Anti-Money Laundering and Anti-Terrorist Financing
Compliance Manual. It is the compliance officer’s responsibility to supervise all aspects of
Xpress Money’s AMF/ATF compliance and to further:
• Conduct weekly examinations of all transactions which fall within the scope of the
compliance manual;
• Ensure the proper reporting and filing of all required reports;
• Ensure random independent audits are performed to verify compliance with the
policies and procedures set forth herein;
• Assess and document the risk related to ML/TF in Xpress Money’s business;
• Ensure that all Xpress Money directors, officers, agents and employees undergo
AML/ATF compliance training programs;
• Staying abreast of any Directives issued under the PC Act and ensure that this
Policy is updated to address such requirements; and
• Conduct annual self-assessment of Xpress Money’s Risk Assessment, policies and
procedures to test their effectiveness and to comply with the two year effectiveness
testing which is required under section 71(1)(e) of the PC Regulations.
The compliance officer is also required to be available to answer any questions regarding
potential money laundering, terrorist financing and suspicious transactions, and is the person to
whom all such questions and any money laundering and terrorists financing related problems
should be directed.
It is extremely important to understand that although Xpress Money has a compliance officer
who is “in-charge” of Xpress Money’s compliance, the compliance officer is not the only person
responsible for ensuring that Xpress Money effectively detects and reports instances of money
laundering/terrorist financing or potential money laundering/terrorist financing. Rather, the
compliance officer should be thought of as Xpress Money’s “last line of defense” who is
available to answer questions, provide guidance and supervise Xpress Money’s AML/ATF

6
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

ROLES AND RESPONSIBILITIES OF A COMPLIANCE compliance system. Under no circumstances should the compliance officer be thought of as
being solely responsible for addressing money laundering / terrorist financing issues. For this
OFFICER reason all Xpress Money officers, directors, employees and agents of Xpress Money, must not
only read and be familiar with the provisions of this manual but must also undergo periodic
AML/ATF training programs, at the direction of the compliance officer. Furthermore, it is Xpress
The compliance officer is responsible for the day-to-day compliance by Xpress Money with the
Money’s policy that it is incumbent upon everyone associated with Xpress Money to take
PC Act. The compliance officer will be instrumental in the development and conformity of
responsibility for, and to actively partake in, Xpress Money’s AML/ATF compliance program.
Xpress Money’s compliance policies and procedures and in the development and maintenance
of an ongoing compliance-training program for employees and agents.

Xpress Money has appointed Mr. Inderpal Singh Bharaj to be its Chief Compliance Officer (the
“Chief Compliance Officer”). The contact details for Mr. Inderpal Singh Bharaj are as follows:
7025 Tomken Road, Suite 237
Mississauga, ON L5S 1R6
Tel: [phone] | Fax: [phone]
Email: [email protected]
The compliance officer’s primary duty is to ensure the effective implementation and enforcement
of the policies set forth in Xpress Money’s Anti-Money Laundering and Anti-Terrorist Financing
Compliance Manual. It is the compliance officer’s responsibility to supervise all aspects of
Xpress Money’s AMF/ATF compliance and to further:
• Conduct weekly examinations of all transactions which fall within the scope of the
compliance manual;
• Ensure the proper reporting and filing of all required reports;
• Ensure random independent audits are performed to verify compliance with the
policies and procedures set forth herein;
• Assess and document the risk related to ML/TF in Xpress Money’s business;
• Ensure that all Xpress Money directors, officers, agents and employees undergo
AML/ATF compliance training programs;
• Staying abreast of any Directives issued under the PC Act and ensure that this
Policy is updated to address such requirements; and
• Conduct annual self-assessment of Xpress Money’s Risk Assessment, policies and
procedures to test their effectiveness and to comply with the two year effectiveness
testing which is required under section 71(1)(e) of the PC Regulations.
The compliance officer is also required to be available to answer any questions regarding
potential money laundering, terrorist financing and suspicious transactions, and is the person to
whom all such questions and any money laundering and terrorists financing related problems
should be directed.
It is extremely important to understand that although Xpress Money has a compliance officer
who is “in-charge” of Xpress Money’s compliance, the compliance officer is not the only person
responsible for ensuring that Xpress Money effectively detects and reports instances of money
laundering/terrorist financing or potential money laundering/terrorist financing. Rather, the
compliance officer should be thought of as Xpress Money’s “last line of defense” who is
available to answer questions, provide guidance and supervise Xpress Money’s AML/ATF

7
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

RISK ASSESSMENT
Xpress Money’s compliance program is required to include an assessment and documentation
of the risks related to money laundering and terrorist financing in Xpress Money’s business, so
as to allow Xpress Money to focus its resources where they are most needed to manage risks
within its tolerance level.
Assessment
As required by section 71(1) of PC Regulations, Xpress Money’s risk assessment will consider
and document the following factors:
• Xpress Money’s clients and business relationships;
− These include risks associated with the types of customers that use Xpress
Money’s services and the customer’s stated purpose in dealing with Xpress
Money. Examples of the categories of clients that may indicate a higher risk
would include politically exposed foreign persons, customers whose nature,
structure or relationship make it difficult to identify the ultimate beneficial owner
of significant or controlling interests, as well as customers conducting
transactions in unusual circumstances.
• Xpress Money’s products and services and the delivery channels through which it
offers them;
− These include risks associated with the types of products and services offered
by Xpress Money and how such products and services are delivered to
customers. Examples of the type of services and circumstances that may
indicate a higher risk classification would include customer’s conducting
frequent international electronic funds transfers or transactions with persons
located in high risk geographic locations as well as transactions not conducted
on a face to face basis.
• The geographic locations where Xpress Money conducts its activities and the
geographic locations of its clients and its agents (including any geographic locations
which may be the subject of a Directive);
− These include risks associated with the places where Xpress Money’s business
activities are carried out including jurisdictions where Xpress Money engages in
business activities with agents as well as risks associated with the jurisdictions
in which its customers are located.
• Any new developments in respect of, or the impact of new technologies on, Xpress
Money’s clients, business relationships, products or delivery channels or the
geographic location of its activities;
− Xpress Money must periodically consider new technologies that are impacting
its business and whether such technologies will impact the risk profile of Xpress
Money’s existing products, delivery channels, customers and geographic
locations.

8
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

RISK ASSESSMENT • Xpress Money’s agents;
− Please refer to the discussion below for a summary of the risks associated with
entering into business arrangements with agents and foreign counterparties.
Xpress Money’s compliance program is required to include an assessment and documentation
of the risks related to money laundering and terrorist financing in Xpress Money’s business, so Using a risk based approach, Xpress Money will conduct periodic risk assessments to
as to allow Xpress Money to focus its resources where they are most needed to manage risks determine where the money laundering -and terrorist financing risks are greatest. The risk
within its tolerance level. assessment will take into account the factors listed above (i.e., Xpress Money’s client’s and
business relationships, products and services, the geographies in which Xpress Money (and its
Assessment customers) conduct business, the delivery channels of Xpress Money’s services including its
agents, and the impact of new technologies) and will inform Xpress Money’s risk rating
As required by section 71(1) of PC Regulations, Xpress Money’s risk assessment will consider methodology for its business and will also be used to assign a risk rating of “High” or “Low” to
and document the following factors: client business relationship. The risk assessment for all business relationships is updated using
a risk based methodology as described in the Section entitled “Business Relationships &
• Xpress Money’s clients and business relationships; Ongoing Monitoring”.
− These include risks associated with the types of customers that use Xpress
Money’s services and the customer’s stated purpose in dealing with Xpress • Any other relevant factors related to Xpress Money’s business, its clients and the
Money. Examples of the categories of clients that may indicate a higher risk business relationships Xpress Money has with them;
would include politically exposed foreign persons, customers whose nature, − These include points to consider such as trends and typologies related to
structure or relationship make it difficult to identify the ultimate beneficial owner money laundering and terrorist financing in the MSB industry and the level of
of significant or controlling interests, as well as customers conducting employee turnover.
transactions in unusual circumstances.
Business Risk Level Assessment
• Xpress Money’s products and services and the delivery channels through which it
offers them; business
Although Xpress Money is part of an international money services that spans
− These include risks associated with the types of products and services offered
across 5 continents offering its customers instant money transfer services both domestically and
by Xpress Money and how such products and services are delivered to
internationally through a large network of agents, Xpress Money itself only carries on business
customers. Examples of the type of services and circumstances that may
in Canada.
indicate a higher risk classification would include customer’s conducting
frequent international electronic funds transfers or transactions with persons
As an entity that is dedicated to connecting people around the world, Xpress Money and its
located in high risk geographic locations as well as transactions not conducted
agents provide individuals and businesses with a variety of money transfer services that allow
on a face to face basis.
people to send and receive money in cash, direct partner banks to credit a recipient’s bank
accounts, and offer both in person and online money transfer services through “Xpress Money
• The geographic locations where Xpress Money conducts its activities and the
Online”. With “Anywhere Payout” Xpress Money also offers customers the ability to send money
geographic locations of its clients and its agents (including any geographic locations
without specifying the recipient agent’s location which in turn allows the intended recipient of the
which may be the subject of a Directive);
funds to pick up the money from any Xpress Money location that is convenient to them.
− These include risks associated with the places where Xpress Money’s business
activities are carried out including jurisdictions where Xpress Money engages in
As a result, in connection with the provision of its money transfer services, Xpress Money’s
business activities with agents as well as risks associated with the jurisdictions
business offers both in person and non-face to face methods to send and receive money and
in which its customers are located.
often relies on its relationships and business arrangements with agents and foreign
counterparties who are located globally to provide payout services to parties who may reside in
• Any new developments in respect of, or the impact of new technologies on, Xpress
jurisdictions that may be subject to sanctions legislation, have been identified as having
Money’s clients, business relationships, products or delivery channels or the
significant levels of corruption or criminal activity and may not necessarily be subject to the
geographic location of its activities;
same or similar AML compliance obligations and requirements.
− Xpress Money must periodically consider new technologies that are impacting
its business and whether such technologies will impact the risk profile of Xpress
However, despite the inherent risks in Xpress Money’s business, the nature and type of services
Money’s existing products, delivery channels, customers and geographic
offered by Xpress Money with respect to its Canadian business, and the nature of its customer
locations.
base and customer transactions and the Canadian location of its customer base, Xpress Money

9
12867753.3
ANTI-MONEY LAUNDERING AND ANTI-TERRORIST FINANCING COMPLIANCE MANUAL

has determined that, based on its controls, security standards, the global security standards of
its parent company and the business risk mitigation measures it undertakes with respect to its
business in Canada, the AML/ATF risks associated with its Canadian business are low to
moderate for the following reasons:
• Xpress Money’s agent network in Canada is subject to enhanced due diligence and
its foreign counterparties are well-respected banking and non-banking organisations
around the world.
• It is Xpress Money’s policy to only provide payouts upon proper identification of the
beneficiary. Xpress Money has established a unique 16-digit PIN for establishing
error-proof identity of the beneficiary.
• Xpress Money is committed to continuously updating its systems and technology to
ensure that its quality checks and controls are in-line with global security standards
which include centralized servers for hosting all the applications and storing data.
• Xpress Money has robust AML compliance features such as online scanning as well
as country and product specific rules to ensure all regulatory standards set by
organizations are strictly followed.
• Comprehensive risk based AML monitoring solution with World-Check, the leading
global provider of structured risk intelligence solutions.
Additionally, regarding Xpress Money’s business activities in Canada:
• Xpress Money has a stable, known client base.
• Xpress Money w offers electronic transaction services and only limited products and
services.
• Xpress Money has few or no large currency transactions.
• Xpress Money’s agents are located in areas known to have a low crime rate.
• Xpress Money has minimal transactions with high-risk geographic locations.
Based on the foregoing, Xpress Money has determined that the risk rating classification for its
business is low to moderate.
Client Risk Level Assessment
FINTRAC has indicated that a client risk assessment is appropriate only where there is an
ongoing relationship. Where dealings with a client are limited to a single transaction, this is
not considered to be an ongoing business relationship. FINTRAC defines an ongoing business
relationship as one where a client undertakes multiple identifiable transactions over a 5 year
time period, regardless of whether the transactions are related to each other.
As part of its risk assessment, Xpress Money will take steps to “know its clients” for ongoing
business relationships and at various times throughout the relationship, depending on the risk
profile of particular transactions that take place. In addition, the content of any Directive will be
considered in completing any risk assessment. Please see “Know Your Customer” Policy below.
In addition, Xpress Money will also “Know its Agents” and perform a risk assessment on each
agent and client business relationship assigning each a risk rating classification of “High”, or

10
12867753.3