Anti ML & KYC Policy
Heights Jewelers LLC KYC & Anti-Money Laundering Policy
Heights Jewelers LLC (“HJ LLC” or "Company") is committed to conducting its business with the highest ethical and legal standards and expects all employees and other individuals acting on its behalf to uphold this commitment. As such, the Company has adopted this KYC & Anti-Money Laundering Policy (“Policy”), which is applicable to all directors, oﬃcers, employees, agents, representatives, consultants, advisors, distributors, supplier contractors, or other third parties acting on behalf of the Company, even on a provisional and temporary basis ("Company Personnel").
HJ LLC will not conduct business with individuals or corporations whose conduct may give risk to suspicions of involvement with illegal activities. HJ LLC will report any suspicions of money laundering or terrorist ﬁnancing activity to the relevant authorities.
This Policy and the internal controls herein have been designed to avoid money laundering, including the laundering of illicit proceeds by the same person (self-laundering), and the use of money, goods, or gains of illicit provenance and, consequently, prevent potential criminal liability of the Company that could result from such violations/crimes.
Company Personnel who violate this Policy may be subject to disciplinary action, including dismissal from the Company, termination of agreements, and or any other associated legal and out-of-court actions, in accordance with the applicable law. The consequences for violating anti-money laundering laws can be severe for the Company, including signiﬁcant ﬁnes, loss of operating licenses, limitations on engaging in certain business activities, imprisonment, and reputational damage.
The Company Personnel must comply with the anti-money laundering laws of all countries where the Company carries out its activities.
2. Important Deﬁnitions
Money laundering is deﬁned as engaging in acts to conceal or disguise the origins of illegally or criminally derived proceeds and assets so that they appear to have legitimate origins and are introduced into the legal ﬁnancial and business as if they were lawful. If any Company Employee or Company Personnel suspects that there has been money laundering, that person must immediately report the suspected violation to HJ LLC’s Compliance Team.
For the purposes of this policy, the following conducts shall be regarded as money laundering:
The conversion or transfer of property, knowing that such property is derived from criminal activity or from an act of participation in such activity, for the purpose of concealing or disguising the illicit origin of the property or of assisting any person who is involved in the commission of such an activity to evade the legal consequences of that person's action.
- The concealment or disguise of the true nature, source, location, disposition, movement, rights with respect to, or ownership of, property, knowing that such property is derived from criminal activity or from an act of participation in such activity.
- The acquisition, possession, or use of property, knowing, at the time of receipt, that such property was derived from criminal activity or from an act of participation in such activity.
- Participation in, association to commit, attempts to commit and aiding, abetting, facilitating, and counselling the commission of any of the above-mentioned
Examples of illicit provenance are forgery of money, extortion, robbery, and drug crime, as well as fraud, corruption, organized crime, or terrorism, etc.
The money laundering process consists of three “stages”:
- Placement: This involves the introduction of illegally obtained monies or other valuables into ﬁnancial or non-ﬁnancial institutions.
- Layering: Layering occurs by conducting multiple, complex ﬁnancial transactions that make it diﬃcult to link the money to an illegal activity. These layers are designed to hamper the audit trail, disguise the origin of funds and provide anonymity.
- Integration: Placing the laundered proceeds back into the economy in such a way that they re-enter the ﬁnancial system as apparently legitimate funds.
3. Financing Terrorism
Company Personnel must immediately report any suspected or known terrorist ﬁnancing to HJ LLC’s Compliance Team. For the purposes of this Policy, “terrorist ﬁnancing” means the provision or collection of funds, by any means, directly or indirectly, with the intention to be used or in the knowledge that they are to be used, in full or in part, in order to use indiscriminate violence as a means to create terror, fear, or to achieve a political, religious, or ideological aim.
4. Politically Exposed Person (PEP)
Transactions involving Politically Exposed Persons (“PEPs”) require enhanced due diligence. A PEP is an individual who is or has been entrusted with a prominent public function. Due to their position and inﬂuence, it is recognized that many PEPs are in positions that potentially can be abused for the purpose of committing money laundering oﬀences and related predicate oﬀences, including corruption and bribery, as well as conducting activity related to terrorist ﬁnancing. The potential risks associated with PEPs justify the application of additional anti-money laundering/counterterrorist ﬁnancing preventive measures.
For the purposes of this Policy, Politically Exposed Persons (“PEP”) includes, but are not limited to:
- Heads of State, heads of government, ministers and deputy or assistant
- Members of parliament or of similar legislative
- Members of the governing bodies of political
- Members of supreme courts, of courts or of other high-level judicial bodies, the decisions of which are not subject to further appeal, except in exceptional circumstances.
- Members of courts of auditors or of the boards of central
- Mayors and members of local administration, city and district
- Ambassadors, chargés d'aﬀaires, and high-ranking oﬃcers in the armed
- Members of the administrative, management or supervisory bodies of State-owned
- Directors, deputy directors and members of the board or equivalent function of an international
Not only the person that oﬃciates a public function must be considered as PEP, but also close family members must also be included in the assessment. For the purpose of this Policy, family members mean:
- The spouse, or a person considered to be equivalent to a spouse, of a politically exposed
- The children and their spouses, or persons considered to be equivalent to a spouse, of a politically exposed person.
- The parents of a politically exposed
Also, persons known to be close associates to a PEP must be assessed with the same risk approach that includes:
- Natural persons who are known to have joint beneﬁcial ownership of legal entities or legal arrangements, or any other close business relations, with a Politically Exposed
- Natural persons who have sole beneﬁcial ownership of a legal entity or legal arrangement which is known to have been set up for the de facto beneﬁt of a Politically Exposed
- President, State Governors, mayors, and any kind of ancillary such as ministers, counselors, and
- Oﬃcers or employees of national, federal, regional, local, or other, government bodies, departments, or agencies.
- Oﬃcer or employees of state-owned or state-controlled entities, national or
- Heads of state or anyone who exercises governmental
- Politicians, political party oﬃcials and candidates for political oﬃce.
- Employees of regulatory agencies, public entities and mixed capital
- Oﬃcers and employees of public international organizations, as the United Nations, the World Bank and the International Monetary Fund.
5. Operational Principles
The careful examination of those operations where risk factors exist is important. For example, this could mean those in which third parties propose the use of cash or bearers’ checks, international transactions (in particular those with persons or entities residents in tax havens or high-risk territories, or diﬀerent locations from those where the company operates), operations with persons holding positions of public responsibility or PEPs or transactions conducted through or related to intermediary companies.
The Company Personnel should not initiate, maintain, or accept a new business relationship (customer, supplier, ﬁnancier, etc.), provide services or take action with anyone know or suspect to be involved in money laundering or terrorist ﬁnancing, even if in diﬀerent businesses from the relationship being established with HJ LLC.
Likewise, the Company Personnel should not deal with money, goods or valuables that know or suspect to be of illicit origin or that are unaware of.
HJ LLC is committed to ﬁght against money laundering and the ﬁnance of terrorism. Therefore, the following due diligence principles should be followed, not only in situations where particular risk factors exist, but as to all customers and third parties:
1) Identifying the Third Party (KYC)
Company Personnel must conduct due diligence on customers and other third parties and document the ﬁndings. As part of the due diligence process, the following information (as applicable) should be collected: name, date of birth, address, SSN, passport number, or residence card if it is a physical person or company name, registered oﬃce, corporate purpose, Employer Identiﬁcation Number, FEIN, SSN, and/or incorporation details if it is a corporation.
As part of due diligence, the Company must verify that the customer or third party does not appear on any of the US Department of the Treasury Oﬃce of Foreign Assets Control’s sanctions list, including the Specially Designated Nationals and Blocked Persons lists, as well as if the client or the third party is responding or has already responded to any inquiry o summons. The Company should ask and search to conﬁrm, whether the client or third party is or has been involved in an investigation of any kind involving corruption, money laundering or acts of terrorism. The Company will not enter into a business relationship with a person or an entity that appears on one of these lists.
You must also take steps to understand the nature and purpose of the customer or third-party relationship and develop an appropriate risk proﬁle based on the information learned. Based on the risk proﬁle, the Company may actively maintain and update the customer or third-party information. The Company also will conduct ongoing monitoring to identify suspicious transactions and report those transactions where legally required.
2) Identifying the Ultimate Beneﬁcial Owner as KYC (UBO)
Before the commencement of a commercial relationship, whether of a habitual nature, and prior to its execution, the Ultimate Beneﬁcial Owner of any Third Parties who are formally involved must be identiﬁed. Company Personnel must document this analysis. Ultimate Beneﬁcial Owner (UBO) means the person who directly or indirectly controls 25% or more of the equity or voting rights in the corresponding company or owns the company. In the event of the existence of a beneﬁcial owner in the third party, that person must be identiﬁed through their name, nationality, citizenship, passport, or residence card. Publicly listed companies are excluded from the obligation to identify the UBO.
If the UBO is a PEP, then the Company must conduct enhanced due diligence before entering into any contractual or commercial relationship with the entity.
3) Obligation to formally record commercial relationships in writing.
Before the commencement of commercial relationships and prior to carrying out transactions with third parties (attention being paid to those of an international nature) the relationship must be formally recorded in a written agreement in accordance with HJ LLC’s standards.
The provisions in a written agreement should include a commitment to comply with the Anti-Money Laundering laws, and HJ LLC’s right to immediately terminate the contract in case of violation, subject to applicable law.
6. Red Flags for Money Laundering and Terrorist FinancingRed Flags for Money Laundering and Terrorist Financing include:
- Unexplained spikes in account
- Large number of transactions, which could indicate
- The third party tries to conceal its identity or the source of its
- The third party is an entity without a clear registered oﬃce and does not appear
- The third party’s structure makes it diﬃcult to recognize
- The third party funds for the transaction come from abroad when there is no apparent link between this country where the funds are sourced and the third party.
- The third party uses multiple bank accounts or ones held abroad without any justiﬁcation.
- The third party intends to make payments in cash or using bearer
- The third party intends to pay a higher price for the services for no good
- The third party is based in a tax haven or a high-risk
7. Enhanced Due Diligence
If you identify a red ﬂag or the transaction directly or indirectly involves a PEP, then enhanced due diligence must be conducted prior to entering into a business relationship with the customer or third party.
Enhanced due diligence involves the gathering of additional information to ensure that the person or entity is not participating in any improper or illicit conduct. This information should include, but is not limited to, the source of the funds, the source of the individual or company’s wealth, and the individual’s occupation or the type of business. The ﬁndings of enhanced due diligence should be documented.
If you are unsure whether enhanced due diligence is required in a particular situation or have any other questions regarding enhanced due diligence, they should contact HJ LLC’s Compliance Team at firstname.lastname@example.org
8. Insider Abuse
Company Personnel and other individuals that are closely aﬃliated with the Company should not also engage in actions that constitute money laundering or facilitate the commission of money laundering.
If you suspect that an employee or other Company aﬃliate has engaged in improper or illicit activity, or if you have any questions about insider abuse, you should contact HJ LLC’s Compliance Team.
HJ LLC has zero tolerance for any form of retaliation, including intimidation, exclusion, humiliation, or other forms of harassing employees who, in good faith, report misconduct or express concern about a particular practice or decision at email@example.com
9. Seeking Advice and Reporting Potential Violations
Company Personnel must immediately report to the Compliance Team the facts or circumstances that may be characterized as a violation of the law or the company´s internal policies. If you suspect of a violation of this Policy or of any anti-money laundering laws, you must notify a Compliance Team member without delay, and you should not comment on your suspicion or any indication or evidence that you became aware of with any third parties. If you are unsure of whether conduct constitutes money laundering or have any questions regarding the Policy or other HJ LLC policy, or if need help or wish to raise a concern, you may communicate that to our Compliance Team at firstname.lastname@example.org