PMLA Policy

PMLA (Anti Money Laundering) Policy

Introduction

This policy is framed and adopted as a requirement by SEBI under the Prevention of Money Laundering Act, 2002 (“PMLA”). The policy provides a framework with respect to anti money laundering measures to be taken by Trade Nova Technologies Private Limited, as a SEBI registered Research Analyst vide Registration Number INH000026789.

I. Objective of the PMLA Policy

• To prevent Trade Nova Technologies Private Limited from being used, intentionally or unintentionally, by criminal elements for money laundering or terrorist financing activities.
• Create awareness and provide clarity on KYC standards and AML measures.
• To have a proper Client Due Diligence (CDD) process before registering clients.
• To monitor and report suspicious transactions.
• To monitor and maintain records of all cash transactions done by the client of the value of more than Rs. 10 lakh.

II. Client Due Diligence (CDD) Process

As a part of the Client Due Diligence process, Trade Nova Technologies Private Limited will do the following:

• Maintain a record of Know Your Customer (KYC) documents — valid identity proof and address proof — obtained from every client at the time of onboarding.
• In order to verify the genuineness of the clients, speak with the clients before proceeding with any research services.
• Maintain the records between the client and Trade Nova Technologies Private Limited in proper order.

III. Policy for Acceptance of Client

Trade Nova Technologies Private Limited will ensure that:

• No account shall be opened in a fictitious name or on an anonymous basis.
• No account will be opened if the fee for services is offered by the client in cash.
• No account is opened where Trade Nova Technologies Private Limited is unable to apply appropriate CDD measures / KYC policies. This shall apply to cases where the information provided is suspected to be non-genuine, or there is perceived non-cooperation of the client in providing full and complete information.
• It will be ensured that the identity of the client does not match with any person having a known criminal background, or who is banned in any other manner, or is included in the list of individuals and entities subject to sanction measures such as freezing of assets/accounts or denial of financial services, as approved by the Security Council Committee established pursuant to various United Nations’ Security Council Resolutions (UNSCRs).

Risk categorisation

Each client shall be classified in low, medium or high risk categories depending upon risk perception. Such risk may be arrived at considering:

• the client’s location (registered office address, correspondence address and other addresses, if applicable);
• nature of business activity, trading turnover etc.; and
• the manner of making payment for transactions undertaken.

Clients of Special Category (CSC)

Clients of Special Category require a higher degree of due diligence and regular update of the KYC profile. CSC shall include:

• Non-resident clients;
• High net-worth clients;
• Trusts, charities, Non-Governmental Organizations (NGOs) and organizations receiving donations;
• Companies having close family shareholdings or beneficial ownership;
• Politically Exposed Persons (PEP);
• Companies offering foreign exchange offerings;
• Clients in high risk countries where the existence or effectiveness of money laundering controls is suspect;
• Non face-to-face clients;
• Clients with dubious reputation as per public information available.

IV. Suspicious Transactions

Trade Nova Technologies Private Limited will ensure that appropriate steps are taken to enable suspicious transactions to be recognized, based on circumstances such as:

• Clients whose identity verification is difficult, or who are not ready to cooperate.
• Where the source of funds of the client is not clear, or is not in keeping with the client’s apparent standing or business activity.
• Substantial increases in business without apparent cause.
• Clients based in high-risk jurisdictions.
• Clients transferring large sums of money to or from overseas locations with instructions for payment in cash.
• Attempted transfer of investment proceeds to apparently unrelated third parties.
• Unusual transactions by CSCs, and businesses undertaken by offshore banks/financial services, or businesses reported to be in the nature of export-import of small items.

In the event of any suspicious transaction, Trade Nova Technologies Private Limited will make a report based on the reference to the client, the transaction and the nature/reason of suspicion. The report will be submitted to the Director, Financial Intelligence Unit-India.

Where transactions are abandoned or aborted by clients on being asked to give details or provide documents, Trade Nova Technologies Private Limited will report all such attempted transactions in Suspicious Transaction Reports, even if not completed by the client, irrespective of the amount of the transaction.

V. Monitoring of Transactions

• Special attention shall be paid to all complex, unusually large transactions or patterns which appear to have no economic purpose.
• Internal threshold limits for each class of client account shall be defined, and special attention shall be paid to transactions which exceed these limits.
• The background — including all documents, office records, memoranda and clarifications sought pertaining to such transactions and the purpose thereof — shall be examined carefully and findings recorded in writing.
• The findings, records and related documents shall be made available to auditors and also to SEBI, stock exchanges, FIU-IND and other relevant authorities during audit, inspection or as and when required.
• These records shall be preserved for a period of five years from the date of transaction with such client.

Transactions monitored at all times

• All cash transactions of the value of more than ten lakh rupees or its equivalent in foreign currency;
• All series of cash transactions integrally connected to each other which have been individually valued below ten lakh rupees or its equivalent in foreign currency, where such series of transactions have taken place within a month and the monthly aggregate exceeds ten lakh rupees or its equivalent in foreign currency;
• All cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine, or where any forgery of a valuable security or a document has taken place facilitating the transactions;
• All suspicious transactions, whether or not made in cash, and by way of cheques, pay orders, travellers’ cheques, demand drafts, loans and advances, money transfers or remittances in favour of own clients or non-clients from India or abroad and to third party beneficiaries in India or abroad, and credits or debits into or from any non-monetary accounts such as a demat account.

Periodic review of existing accounts shall be conducted to ensure that no existing account is linked to any entity or individual included in the list by the Security Council Committee. Any resemblance found shall be reported to SEBI and FIU-IND.

VI. Record Keeping and Retention of Records

In case of suspicious transactions, Trade Nova Technologies Private Limited will:

• Ensure compliance with the record keeping requirements contained in the SEBI (Research Analysts) Regulations, 2014, the PMLA and other relevant legislation.
• Maintain such records as are sufficient to permit a trail of individual transactions (including the amount and types of currencies involved, if any) so as to provide, if necessary, evidence for prosecution of any criminal behaviour.
• Retain information for client accounts in order to maintain a satisfactory audit trail, so that competent investigating authorities can reconstruct a financial profile of a suspected account — including the beneficial owner of the account, and for selected transactions the origin of funds, the form in which the funds were offered or withdrawn, the identity of the person undertaking the transaction, the destination of the funds, and the form of instruction and authority.

Records of transactions shall be preserved, and transactions of a suspicious nature shall be reported to the Director, FIU-IND. Records of information related to transactions, whether attempted or executed, which are reported to the Director, FIU-IND shall be maintained and preserved for a period of five years from the date of the transaction with the client. Where the records relate to ongoing investigations or transactions which have been the subject of suspicious transaction reporting, they shall be retained until it is confirmed that the case has been closed.

Information to be maintained

• the nature of the transaction;
• the amount of the transaction and the currency in which it is denominated;
• the date on which the transaction was conducted; and
• the parties to the transaction.

VII. Reporting to Financial Intelligence Unit-India

In terms of the PML Rules, Trade Nova Technologies Private Limited will report information relating to cash and suspicious transactions to the Director, Financial Intelligence Unit-India (FIU-IND) at the following address:

Director,
FIU-IND, Financial Intelligence Unit-India,
6th Floor, Hotel Samrat, Chanakyapuri,
New Delhi – 110021.
Website: fiuindia.gov.in

VIII. Appointment of Principal Officer and Designated Director

To ensure effective discharge of our legal obligations, to report suspicious transactions to the authorities, and for overall supervision and compliance, the following shall be the “Principal Officer” and “Designated Director”, who would act as a central reference point for the identification and assessment of potentially suspicious transactions and in facilitating onward reporting of suspicious transactions to FIU:

Rights, obligations and responsibilities of the Principal Officer

• The Principal Officer shall have all-time access to customer identification data and other CDD information.
• The Principal Officer shall have complete independence and authority to access.
• The Principal Officer shall ensure that the PMLA policy framework is implemented effectively.
• The Principal Officer shall ensure that data generated on FIU on suspicious transactions is regularly and promptly downloaded to analyze, identify and report transactions of a suspicious nature to FIU-IND directly.
• The Principal Officer shall ensure that records and information in relation to all clients and transactions are available on a timely basis to the competent authority.
• The Principal Officer shall ensure that there is a prompt response to any request for information, including KYC related information and records maintained by Trade Nova Technologies Private Limited, made by the regulators, FIU-IND and other statutory authorities.
• The Principal Officer shall ensure that all concerned staff are regularly updated regarding any changes, additions or modifications in PMLA provisions.

Rights, obligations and responsibilities of the Designated Director

• The Designated Director should ensure that all records are maintained as mentioned in this policy.
• In case the Designated Director fails to perform their duties, they shall be penalised and appropriate action may be taken against them.

IX. Employee Hiring, Training and Investor Education

Trade Nova Technologies Private Limited will:

• have adequate screening procedures in place to ensure high standards when hiring employees;
• have an ongoing employee training programme so that members of staff are adequately trained in Anti-Money Laundering (AML) standards and Combating the Financing of Terrorism (CFT) procedures.

X. Review of Policy

The policy shall be reviewed from time to time, and as and when required changes will be implemented as per the applicable rules, laws, acts and regulations.

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Our Principal Officer, Harinder Singh, and Compliance Officer, Pardeep Kumar, are available Mon–Fri · 9:00 AM to 5:00 PM.