Anti-Money Laundering and Sanctions Policy

Fraud is deliberate deception for gain. Money laundering makes criminal money look clean. Sanctions evasion is an attempt to get around restrictions set in law. This policy sets out how the Company keeps all three away from its business.

An effective programme does three things: it complies with the law, it gives the authorities useful information when they need it, and it applies controls proportionate to the risk.

The Group does not deal with restricted persons or territories: counterparties are screened against applicable sanctions and prohibited-jurisdiction lists.

Controls should manage risk without stopping the business: effective, and proportionate in cost, labour and time.

Proceeds of Crime Act 2002, Money Laundering Regulations 2017, and applicable sanctions regimes

PART A — ANTI-MONEY LAUNDERING

1. Policy Statement

The NeoBankers Group Limited is committed to the prevention of money laundering and terrorist financing. Although the Company does not currently conduct regulated financial services activity itself, it maintains this policy as a matter of corporate governance and institutional best practice. Obligations under the Proceeds of Crime Act 2002, sections 327 to 332, apply to all persons in the United Kingdom, not only to firms within the regulated sector.

How the Group applies a risk-based approach.

• Proportionality — controls proportionate to the Group’s size and business model.
• Prioritisation — attention first to higher-risk counterparties and activities.
• Effectiveness — controls judged by results, not by paperwork.

Financial crime risk is the risk that the Group’s name, architecture or relationships are used for criminal activity — fraud, bribery and corruption, tax evasion, sanctions evasion, money laundering, terrorist financing and proliferation financing. No organisation can fight financial crime on its own; the Group works with its partners and the authorities.

Restricted jurisdictions and persons. The Company does not deal with any person, entity or territory subject to sanctions or restrictive measures of the United Kingdom, Switzerland, Liechtenstein or the European Union. Screening is carried out against the current official lists at the time of each check:

• United Kingdom — the UK Sanctions List;
• European Union — the EU Sanctions Map and the EU consolidated financial sanctions list;
• Switzerland — SECO sanctions search;
• Liechtenstein — measures under the International Sanctions Act, published by the Office of Economic Affairs.

Countries change on these lists, so the Company does not publish a fixed list here. Enhanced due diligence applies to counterparties connected with high-risk third countries identified under the Money Laundering Regulations 2017 and by the FATF.

2. Legal Framework

This policy is informed by:

• The Proceeds of Crime Act 2002 (POCA), in particular Part 7 (money laundering offences) and Part 9 (civil recovery).
• The Terrorism Act 2000, in particular Part III (terrorist property).
• The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), as amended.
• The Sanctions and Anti-Money Laundering Act 2018 (SAMLA).
• HM Treasury/Home Office National Risk Assessment of Money Laundering and Terrorist Financing (most recent edition).

3. Money Laundering Offences

Under POCA, the principal money laundering offences are:

• Section 327: concealing, disguising, converting, transferring, or removing criminal property.
• Section 328: entering into or becoming concerned in an arrangement which facilitates the acquisition, retention, use, or control of criminal property.
• Section 329: acquisition, use, and possession of criminal property.

The failure-to-disclose offences (ss. 330-332) apply to all persons within the regulated sector. For persons outside the regulated sector, the primary offences (ss. 327-329) still apply, and the authorised disclosure defence (s. 338) is available.

4. Know Your Customer

The Group conducts appropriate customer due diligence (CDD) on all business relationships and significant one-off transactions. CDD measures include:

• Verification of the identity of counterparties using reliable and independent sources.
• Identification of the beneficial owner(s) of corporate counterparties.
• Assessment of the nature and intended purpose of the business relationship.
• Ongoing monitoring of the business relationship, including scrutiny of transactions.

Enhanced due diligence (EDD) is applied where a higher risk of money laundering or terrorist financing is identified, including but not limited to: politically exposed persons (PEPs), high-risk jurisdictions identified by FATF, complex or unusual transaction structures, and counterparties with opaque ownership structures.

5. Suspicious Activity Reporting

Any director, officer, or associate who knows or suspects, or has reasonable grounds for knowing or suspecting, that a person is engaged in money laundering or terrorist financing must report their concern to the Company's designated officer through the Regulatory and compliance form.

The designated officer will assess the report and determine whether a Suspicious Activity Report (SAR) should be filed with the National Crime Agency (NCA) in accordance with POCA ss. 330-332 or s. 338 (authorised disclosure). No director, officer, or associate shall make any disclosure to a third party that might prejudice an investigation ('tipping off' — POCA s. 333A).

6. Record-Keeping

Records of all customer due diligence measures and transactions are retained for a minimum of five years from the date of the transaction or the end of the business relationship, whichever is later, in accordance with MLR 2017 Regulation 40.

7. Training

All directors and relevant staff receive training on their obligations under anti-money laundering legislation. Training is provided at induction and refreshed at regular intervals (at least annually).

Training covers: the legal framework, identification of suspicious activity, internal reporting procedures, and the consequences of non-compliance.

PART B — SANCTIONS

8. Policy Statement

The NeoBankers Group Limited complies with all applicable financial sanctions regimes, including:

• United Kingdom: sanctions implemented by the Office of Financial Sanctions Implementation (OFSI), a division of HM Treasury, under

SAMLA 2018 and relevant statutory instruments.

• European Union: sanctions adopted by the Council of the European Union under the Common Foreign and Security Policy (CFSP).
• United States: to the extent applicable to the Group's activities, sanctions administered by the Office of Foreign Assets Control

(OFAC), a division of the US Department of the Treasury.

9. Prohibited Activities

The Group will not enter into any transaction, business relationship, or arrangement with any person, entity, or country that is the subject of applicable financial sanctions. The Group will not, directly or indirectly, facilitate any transaction that would result in a breach of applicable sanctions, including the provision of financial services, the making available of funds or economic resources, or any other act prohibited by the relevant sanctions regime.

10. Screening

All counterparties, business partners, directors, beneficial owners, and transactions are screened against current UK (OFSI) and EU sanctions lists prior to engagement and on an ongoing basis. Where applicable to the Group's activities, US (OFAC) lists are also screened. Screening is repeated at appropriate intervals and whenever there is a change in the sanctions lists or in the counterparty's circumstances.

11. Reporting

If any director, officer, or associate becomes aware of a potential sanctions breach, they must report it immediately to the designated officer through the Regulatory and compliance form. The Company will report confirmed breaches to OFSI as required by SAMLA 2018 and to other relevant authorities as required by law. OFSI publishes guidance on monetary penalties for sanctions breaches; the maximum penalty for a serious breach is unlimited.

12. Penalties

Breach of UK financial sanctions is a criminal offence. Penalties under SAMLA 2018 and the relevant statutory instruments include imprisonment of up to 7 years and unlimited fines. OFSI may also impose monetary penalties on a strict liability basis. The Company takes sanctions compliance with the utmost seriousness.

13. Review

This policy is reviewed at least annually and upon any material change in applicable sanctions regimes. Amendments are approved by the Board.

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