TWCC AML POLICY

Effective Date: 10/23/2024

Introduction and Purpose

This Anti Money Laundering (AML) program aims to detect, prevent, and report suspicious activities, ensuring that Texas Wholesale Coin Company, LLC (TWCC) operates ethically, transparently, and legally.

Governance and Compliance Officer

The designated AML Compliance Officer oversees all AML policies and manages any amendments or updates to the program. The officer ensures full cooperation with state and federal authorities, but only to the extent required by law.

While the firm prioritizes privacy in its operations, we recognize that a degree of transparency is essential to maintain compliant and fair business practices. The officer will ensure that personally identifiable information (PII) is protected at all times from unauthorized disclosure.

Additionally, the AML Compliance Officer oversees staff training, ensures proper reporting of suspicious activities, and maintains secure records for audits and regulatory reviews.

Risk Assessment

TWCC assesses customer risks based on customer type, geographical location, services offered, and transaction patterns. We primarily engage with established coin dealers, reputable resellers, and smaller sellers who demonstrate legitimacy in the precious metals space.

Higher-risk customers or transactions—such as those with irregular patterns, international clients, or high-volume trades—require enhanced due diligence (EDD). This involves gathering additional documentation, verifying references, and monitoring activities closely to ensure compliance.

As a wholesaler, TWCC only works with resellers who provide either EINs (businesses) or SSNs (individual resellers), along with current contact information and references during the wholesale application process.

To further promote AML compliance across the industry, TWCC offers the Small Firm AML Template to partners and clients, encouraging them to adopt compliant practices.

Customer Due Diligence (CDD)

TWCC follows the Customer Identification Program (CIP) rules to ensure compliance with AML regulations. During the onboarding process, customers must provide EINs or SSNs, along with accurate contact information and references.

Verification Methods:

    • Government-issued IDs: Driver’s licenses, passports, or similar documentation.
    • Public databases: Cross-referencing customer information with external sources.
    • Beneficial ownership checks: Identifying individuals with 25% or more ownership in a business.
    • Enhanced due diligence: Applied to higher-risk customers to meet AML and CIP standards.

Transaction Monitoring and SARs

TWCC monitors transactions in real-time and periodically to detect suspicious activities, such as large cash deposits, irregular patterns, or unusual cross-border transactions.

Escalation and Investigation Process:

    • Identify and escalate unusual transactions to the AML Compliance Officer.
    • Investigate flagged activities for potential money laundering risks.
    • File Suspicious Activity Reports (SARs) with FinCEN within required timeframes if a transaction raises red flags or meets reporting thresholds.

This process ensures compliance with AML standards and promotes secure business operations.

OFAC Compliance

TWCC adheres to the Office of Foreign Assets Control (OFAC) regulations by screening all customers and transactions against the Specially Designated Nationals (SDN) and other sanctions lists.

Procedures:

    • Screen all new customers and transactions before engagement.
    • Monitor clients and transactions regularly for changes in status or sanctions violations.
    • Block transactions or freeze assets when required by OFAC and report promptly.
    • Escalate identified sanctions violations to the AML Compliance Officer.
    • Regular updates are applied to ensure ongoing compliance with evolving sanctions policies.

Recordkeeping and Reporting

TWCC retains sensitive documents through secure shared digital files and hard copy backups. Access is restricted to authorized personnel to maintain confidentiality.

Retention Practices:

    • Shred sensitive documents when no longer needed or upon request.
    • Retain customer identification records and SAR filings for at least five years.
    • Use secure digital storage with backup capabilities to minimize the risk of data loss.

These practices ensure compliance while safeguarding sensitive information.

Training and Audits

TWCC provides ongoing AML training tailored to employee roles and responsibilities. The training covers identifying suspicious activity, regulatory compliance, and escalation procedures.

Training and Testing Practices:

    • Annual training sessions for all employees, with additional sessions for high-risk roles as needed.
    • Maintain records of completed training for compliance purposes.
    • Conduct independent testing by an external party or internal auditor to evaluate program effectiveness.
    • Review test results, update the program as necessary, and notify employees of any changes.

Policy Review and Updates

TWCC conducts a comprehensive annual review of its AML program to ensure it aligns with current regulations and business operations.

Review Process:

    • The AML Compliance Officer leads the annual review.
    • Ad-hoc updates are made when regulations or business needs change.
    • Independent audits guide program adjustments and ensure continuous improvement.
    • All changes are documented, and relevant employees are trained promptly on updates.

This review process ensures the program stays effective and compliant with evolving regulatory requirements.