Chapter 1

GENERAL PROVISIONS

1. The Policy of JSC Belagroprombank (further the “Bank”) and members of the bank holding¹ on anti-money laundering, counter-terrorist financing and countering financing of proliferation of weapons of mass destruction (further the ‘Policy”) reflects the measures taken by the Bank and members of the bank holding in accordance with:

• The acting legislation of the Republic of Belarus on anti-money laundering, counter-terrorist financing and countering financing of  proliferation of weapons of mass destruction (further “AML/CTF”);
• Regulatory legal acts of the National Bank regulating financial monitoring issues;
• Recommendations of the FATF;
• Anti-money laundering principles for private banking (Wolfsberg Principles);
• The local legal acts of the Bank.

2. Internal control system management in relation to AML/CTF aims to:

• Prevent the intentional or unintentional involvement of the Bank and members of the bank holding in money laundering, terrorist financing and financing of proliferation of weapons of mass destruction;
• Limit (mitigate) risks related to the danger of performing a financial transaction intended for money laundering, terrorist financing and financing of proliferation of weapons of mass destruction (further “ML/TF”).

When constructing an internal control system in the area of AML/CTF, the Bank and members of the bank holding provide:

• when developing measures in the field of AML/CTF, compliance with the requirements established by the legislation of the Republic of Belarus for subjects of the national AML/CTF system, taking into account the specifics of their activities;
• information exchange in the field of AML/CTF and ML/TF risk management, including, if necessary, providing members of the bank holding with identification information about the customer and his financial transactions;
• adequate protection of the confidentiality and use of data obtained during the exchange of information;
• mutual assistance in solving problems associated with the functioning of AML/CTF systems and (or) the implementation of internal control rules in the field of AML/CTF.

Control over the activities of members of the bank holding is carried out in accordance with the local legal acts of the Bank.

3. Internal control system in relation to AML/CTF is implemented in the following main areas:

• Identification and verification in cases provided by the legislation of all Bank’s customers conducting financial transactions, and monitoring customer activity during customer service;
• Detection and documentation of a financial transaction subject to special control, and reporting of the relevant data to the financial monitoring body;
• Storage of data and documents (copies) throughout the term established by the legislation of the Republic of Belarus.

4. The key principle of internal control system management related to AML/CTF is to ensure the involvement of all employees within their job responsibilities throughout the process of identification of customers and their representatives, customer questionnaire and detection of financial transactions subject to special control.

¹ The provisions of the Policy apply to members of the bank holding, that, in accordance with the Law dated 30.06.2014 No. 165-Z “On measures to prevent the legalization of proceeds from crime, the financing of terrorist activities and the financing of the proliferation of weapons of mass destruction”, are persons carrying out financial transactions.

Chapter 2

KEY AREAS

5. In order to manage ML/TF related risks, the Bank applies enhanced internal control measures for high-level ML/TF related risks, and simplified internal control measures are implemented for low-level risks.

• The Bank conducts self-assessment of its involvement in the ML/TF related suspicious transactions.
• The Bank determines and assesses its own ML/TF related risks with due account of NRA² , and takes measures to mitigate them.

6. Within the Policy implementation, as well as for the purpose of ML/TF related risks, the Bank:  

• Performs identification and verification of the participants of the financial transaction in accordance with the legislation of the Republic of Belarus and records the relevant information in the electronic database of customer questionnaires which can be promptly accessed by the authorized employees of the Bank;
• From among the Bank’s customers and their beneficial owners identifies foreign politically exposed persons, officials of public international institutions, persons holding positions included into the list of public positions of the Republic of Belarus as determined by the President of the Republic of Belarus, their family members and close associates to such persons (further “PEP”), as well as institutions which beneficial owners are the persons indicated above;
• Signs contracts with foreign public officials and institutions for which they act as beneficial owners for the performance of financial transactions with the prior written permission of the Bank’s authorized person; if the customer acquired the relevant status and (or) the beneficial owner of the institution became a foreign public official after signing of the contract, the contract shall be extended (renewed) with a written permission of the relevant authorized person;
• Performs monitoring of financial transactions of PEP, as well as institutions which beneficial owners are the specified persons, in compliance with Belagroprombank’s Internal Control Regulations on anti-money laundering, counter-terrorist financing and countering financing of  proliferation of weapons of mass destruction (further the “Regulations”);
• Detects and records financial transactions subject to special control in the special form and submits it in the electronic form to the financial monitoring body;
• Freezes funds owned or held by the person included in the list of  organizations and individuals involved in terrorist activity, as determined by the competent authority of the Republic of Belarus (further the “List”);
• Blocks the financial transaction in case the participant of such transaction or the beneficiary thereof is included into the List;
• In case of detection of the financial transaction that meets the criteria which may be the ground of suspension of the financial transaction or refusal to perform the financial transaction, refusal to connect to the remote bank service system, termination or suspension of services provided via this system, suspends the financial transaction until the responsible official of the Bank has taken a decision to perform the financial transaction or to refuse to perform the financial transaction;
• When performing financial transactions related to money (wire) transfers on behalf of the sender (payer) for the amount that is equal to or exceeds 100 base values, ensures that the information about the sender has been received, transferred and is kept at each stage of the transaction in compliance with the legislation of the Republic of Belarus;
• Applies enhanced internal control identification measures if the participant of the financial transaction is registered, has a place of residence or place of location in the state (within the territory of the state) which is not involved in international cooperation in AML/CTF matters or which does not follow FATF recommendations, and also if financial transactions are conducted via the account kept with the bank registered in such state (within the territory of such state);
• Does not open bank accounts in the name of anonymous owners (when the person wishing to open an account fails to provide the documents necessary for identification purposes) and the owners using fictitious names (pseudonyms);
• Takes measures to prevent the establishment of relationships with nonresident banks which accounts are used by the banks that do not have a permanent governing authority on the territory of the countries where they are registered and are not members of the banking group (bank holding company);
• Does not establish and does not maintain relationships with non-resident banks that do not have a permanent governing authority on the territory of the countries where they are registered and are not members of the banking group (bank holding company);
• Promptly develops measures to mitigate risks in case of detection of an increased ML/TF related risk³;                                                                                     
• Holds regular AML/CTF trainings for the Bank’s employees in accordance with the Program of training for employees of JSC Belagroprombank related to anti-money laundering, counter-terrorist financing and countering financing of proliferation of weapons of mass destruction (further the “Training Program”).

² NRA – National Risk Assessment conducted in the Republic of Belarus, bases on the results of which the level of exposure to ML/TF-related risks of the banking sector was determined as low.

³ Based on the results of internal assessment of ML/FT related risks, the Bank has a ow level of  ML/FT related risk.

   Chapter 3

 INTERNAL CONTROL SYSTEM MANAGEMENT

7. In order to ensure the functioning of the key principle of the internal control system management on AML/CTF, the Bank applies a multi-level internal control system consisting of:

• The person responsible for compliance with the Regulations;
• The special structural unit – the Financial Monitoring Department that consists of specialists responsible for matters related to the financial monitoring;
• Persons responsible for the management and coordination of internal control;
• Responsible officers;
• The Bank’s employees who perform financial transactions on current (settlement) accounts and other customer accounts and(or) customer service, identifying suspicious financial transactions, conducting customer identification.

8. The Deputy Chairman of the Management Board who supervises the Financial Monitoring Department is responsible for the compliance with the Regulations.

9. Within the Policy implementation, the Financial Monitoring Department performs the following key functions:   

• Development and methodological support of the Bank’s local legal acts related to AML/CTF;
• Coordination of internal control system management related to AML/CTF in the Bank;
• Development of procedures to manage ML/TF-related risks;
• Bringing of regulatory legal acts, letters and explanations with regard to AML/CTF issues to the attention of to structural subdivisions in a timely manner;
• Submitting suggestions to the Bank’s management on the improvement and enhancement of the efficiency of the internal control system related to AML/CTF;
• Involvement in the process of implementation of new banking products and services;
• Managing and participating in the training of the Bank’s employees, including knowledge test, in accordance with the Training Program;
• Providing advice to the Bank’s employees on AML/CTF issues;
• Assessing the adequacy of the set of criteria used by the Bank to identify suspicious financial transactions;
• Preparing and presenting to the Supervisory Board of the Bank the report summarizing the results of the Regulations implementation and the recommended measures to improve the AML/CTF-related internal control system, at least once a year;
• Cooperation with the Financial Monitoring Department of the State Control Committee, the National Bank and the Association of Belarusian Banks on AML/CTF issues.

9-1. Members of the bank holding develop internal control rules in the area of AML/CTF, appoint responsible persons for their implementation, manage ML/TF risks taking into account the requirements determined by the state bodies exercising control over activity of members of the bank holding regarding observance by them of the legislation in the AML/CTF sphere.

Chapter 4

FINAL PROVISIONS

11. Customer information obtained by the Bank and members of the bank holding in the course of identification, as well as information on financial transactions of the customers is confidential.

Information about customers and their transactions may be provided only in cases stipulated by the legislation of the Republic of Belarus.

12. The Bank and members of the bank holding keeps:

• Information and documents (copies of documents) obtained in the course of identification of customers and their representatives for at least five years after the termination of the written contracts related to the financial transactions, and  for at least five years from the date of financial transactions if such contracts are not in place;
• Copies of special forms and documents (copies of documents) which serve as grounds for performing financial transactions – at least five years from the date of financial transactions.

13. In case of changes to the current legislation, the Policy will apply to the extent not contradicting the current legislation until the relevant changes and amendments are introduced into the Policy.

Financial Monitoring Department