Zil Money is a financial technology company, not a bank or an FDIC member. Zil Money offers banking services through partnership with FDIC member banks Silicon Valley Bank, Texas National Bank, and East-West Bank.

SUSPICIOUS ACTIVITY MONITORING AND REPORTING GUIDELINES

 

INTRODUCTION:

At Zil Money, we place utmost importance on maintaining the integrity of our payment processing services and safeguarding the interests of our valued customers and partners. These “SUSPICIOUS ACTIVITY MONITORING AND REPORTING GUIDELINES” (hereinafter referred to as the “Guidelines”) serve as a fundamental framework for our commitment to combatting financial crimes and ensuring regulatory compliance.

  1. Purpose of the Guidelines:

The primary purpose of these Guidelines is to establish clear and comprehensive procedures for the detection, monitoring, and reporting of suspicious activity within our platform. By implementing robust monitoring methods and reporting practices, we aim to identify potential risks associated with money laundering, fraud, and other illicit activities, thereby safeguarding our ecosystem from potential threats.

  1. Scope and Applicability:

These Guidelines apply to all aspects of Zil Money’s operations, including but not limited to B2B payment processing services, ACH origination, check clearing, and other financial transactions facilitated by our platform. It extends to all employees, agents, and affiliates involved in providing and supporting our services, ensuring a unified approach towards preventing and reporting suspicious activity across the organization.

  1. Regulatory Compliance Statement:

Zil Money is committed to adhering to all relevant regulatory requirements, including anti-money laundering (AML) laws, Bank Secrecy Act (BSA) regulations, and Office of Foreign Assets Control (OFAC) sanctions. By aligning our Guidelines with industry standard international best practices, we demonstrate our dedication to maintaining transparency and upholding the highest standards of compliance in the payment processing industry.

These Guidelines form the cornerstone of our approach to suspicious activity monitoring and reporting, fostering a secure and trustworthy environment for our customers and partners. By strictly following the principles outlined in this document, we seek to enhance our partnerships and remain at the forefront of responsible fintech platforms.

 

DEFINITIONS:

To ensure clarity and consistency throughout these Guidelines, the following definitions are provided for key terms and concepts used in the context of suspicious activity monitoring and reporting:

  1. Suspicious Activity (SA):

In accordance with applicable laws and industry best practices, “Suspicious Activity” refers to any financial transaction or behavior that may indicate potential involvement in money laundering, terrorist financing, fraud, or other illicit activities. It includes, but is not limited to:

  • Transactions involving individuals or entities listed on government watchlists or subject to Office of Foreign Assets Control (OFAC) sanctions.
  • Unusual transaction patterns, such as frequent large transfers or sudden changes in transaction behavior.
  • Transactions that appear to be structured to evade reporting requirements or conceal the true nature of funds.
  • Activities inconsistent with the customer’s known business or regular transactional behavior.
  • Large volume transfers or movement of funds without apparent lawful purpose.
  • Transactions intended to fund or support illegal activities, including money laundering, terrorism, or other criminal acts.
  1. Monitoring Methods – Manual and Automated:

Zil Money employs a combination of manual and automated monitoring methods to identify and flag suspicious activities effectively:

  • Manual Monitoring: This involves periodic review and analysis by trained personnel to detect unusual or potentially suspicious transactions that may not be easily identifiable through automated means. Manual monitoring adds a human intelligence element to the process, contributing to a more nuanced understanding of customer behavior.
  • Automated Monitoring: Our platform utilizes sophisticated software systems and algorithms to continuously analyze vast amounts of transactional data in real-time. Automated monitoring allows for the prompt identification of suspicious patterns and behaviors, ensuring timely reporting and action.
  1. Relevant Software Systems Used:

As part of our commitment to staying at the forefront of fintech innovation and compliance, Zil Money employs the following reputable software systems to enhance our suspicious activity monitoring capabilities:

  • Sift: Sift examines various aspects of user activities, such as device information, locations, and online actions, to assign a fraud score and identify potential suspicious behavior.
  • IP Quality Score: This tool offers fraud prevention solutions, including bot detection, proxy detection, and email validation, to identify fraudulent accounts and malicious users.
  • OFAC Checking: Our system integrates with the “Office of Foreign Assets Control (OFAC) watchlist” to identify and mitigate risks associated with sanctioned individuals or entities.
  • Persona: The Persona verification tool aids in collecting and validating user IDs, ensuring the authenticity of customer information.

These definitions serve as a foundational reference for understanding the key terms and methodologies essential to effective suspicious activity monitoring and reporting at Zil Money. By adhering to these definitions, we maintain a consistent and thorough approach to combating financial crimes and safeguarding our platform and stakeholders.

 

OVERVIEW OF SUSPICIOUS ACTIVITY REPORTING (SAR):

In our commitment to combat financial crimes and maintain a secure financial ecosystem, Zil Money recognizes the critical role of Suspicious Activity Reporting (SAR) in Anti-Money Laundering (AML) compliance. This section provides an overview of the SAR process and its significance, outlining the essential steps for effective reporting and internal escalation procedures.

  1. Importance of SAR in AML Compliance:

SARs play a pivotal role in our AML compliance program, enabling us to identify and report potential suspicious activities that may indicate money laundering, terrorist financing, or other illicit conduct. By promptly filing SARs with the appropriate authorities, we contribute to the collective efforts to combat financial crimes, enhance financial transparency, and protect our customers and partners from potential risks.

  1. SAR Filing Requirements and Process:

Zil Money maintains a robust SAR filing process to ensure timely and accurate reporting of suspicious activities. When any employee, agent, or affiliate identifies transactions or behaviors that raise suspicion, they are required to promptly report the matter to our designated AML compliance officer. The AML compliance officer will conduct a thorough investigation, analyzing the information received and, where necessary, seek additional supporting evidence.

Upon verification of suspicious activity, the AML compliance officer will prepare a comprehensive SAR, including all required information as per regulatory guidelines. The SAR filing process ensures strict adherence to the timelines set forth by the relevant authorities, ensuring that SARs are submitted within the prescribed reporting window.

  1. Internal Reporting and Escalation Procedures:

In line with our commitment to transparency and compliance, internal reporting and escalation procedures are established to facilitate seamless communication within the organization. Any employee, agent, or affiliate who identifies or suspects suspicious activity is encouraged to report it to their immediate supervisor or directly to the AML compliance officer.

If necessary, the AML compliance officer will escalate the matter to senior management or relevant authorities for further guidance and collaboration. These internal escalation procedures emphasize the importance of a collaborative approach in safeguarding our platform and stakeholders, fostering an environment where concerns are addressed promptly and decisively.

By adhering to the principles outlined in this section, Zil Money ensures that SARs are filed accurately, promptly, and in strict compliance with regulatory requirements. Through our commitment to SAR reporting, we contribute to a secure and transparent financial landscape, reinforcing our position as a responsible fintech platform in the payment processing industry.

 

RISK IDENTIFICATION AND MONITORING:

To ensure the proactive detection and prevention of suspicious activity, Zil Money adopts a comprehensive approach to risk identification and monitoring. This section outlines the key indicators of suspicious activity, the criteria and thresholds used for monitoring, and the advanced tools and algorithms employed to enhance fraud detection capabilities.

  1. Key Indicators of Suspicious Activity:

Zil Money’s vigilant monitoring process is guided by a set of key indicators that may signal potential suspicious activity. These indicators include but are not limited to:

  • Transactions involving individuals or entities listed on government watchlists or subject to Office of Foreign Assets Control (OFAC) sanctions.
  • Unusual transaction patterns, such as frequent large transfers or sudden changes in transaction behavior.
  • Transactions that appear to be structured to evade reporting requirements or conceal the true nature of funds.
  • Activities inconsistent with the customer’s known business or regular transactional behavior.
  • Large volume transfers or movement of funds without apparent lawful purpose.
  • Transactions intended to fund or support illegal activities, including money laundering, terrorism, or other criminal acts.
  1. Monitoring Criteria and Thresholds:

Our monitoring criteria and thresholds are carefully calibrated to identify deviations from normal customer behavior and transaction patterns. These criteria are designed to detect suspicious activities promptly while minimizing the risk of false positives. Zil Money continuously refines and updates these criteria based on regulatory requirements and industry best practices to ensure optimal effectiveness.

The thresholds set for various types of transactions and activities are subject to ongoing review and analysis, considering the evolving nature of financial crimes and emerging risks. The implementation of dynamic thresholds allows us to respond swiftly to new threats and adapt our monitoring practices accordingly.

  1. Tools and Algorithms for Fraud Detection:

Zil Money harnesses advanced tools and cutting-edge algorithms to fortify its fraud detection capabilities. These tools, including but not limited to Sift, IP Quality Score, OFAC Checking, and Persona, effectively analyze vast volumes of transactional data in real-time. Our sophisticated algorithms automatically flag potentially suspicious activities, providing our monitoring team with valuable insights for further investigation.

The integration of these tools ensures a comprehensive and robust approach to risk identification, enabling us to identify and address suspicious activities promptly and accurately.

By adhering to the principles outlined in this section, Zil Money demonstrates its commitment to adopting best-in-class risk identification and monitoring practices. Through continuous improvement and proactive measures, we maintain a secure and resilient payment processing platform for the benefit of our customers and partners.

 

REPORTING PROCEDURES:

Zil Money maintains a proper reporting framework to ensure the timely and accurate submission of Suspicious Activity Reports (SARs) to the appropriate authorities and partner banks. This section outlines the procedures for reporting suspicious activity, the required information for SAR filing, and the documentation and record retention standards to uphold regulatory compliance.

  1. Timely Reporting to Service Partners:

As a responsible fintech platform, Zil Money recognizes the importance of promptly reporting suspicious activities to our service partners including back-end banks. Any identified suspicious activity is diligently assessed and, if verified, reported to the respective service partner within the mandated timeframe. This commitment to timely reporting strengthens our collaborative efforts to combat financial crimes and protect the interests of our stakeholders.

  1. Required Information for SAR Filing:

Our SAR filing process adheres strictly to regulatory guidelines, ensuring the inclusion of all necessary information in each report. The comprehensive SAR includes, but is not limited to:

  • Date and nature of the suspicious transaction or behavior.
  • Identity and relevant details of the involved customer or account.
  • Description of the observed suspicious activity and its potential implications.
  • Supporting evidence and additional information gathered during the investigation.
  • Any internal actions taken in response to the identified suspicious activity.

By consistently providing complete and accurate information in our SAR filings, we contribute to the efficacy of the regulatory authorities in their efforts to combat financial crimes.

  1. Documentation and Record Retention Standards:

Zil Money places utmost importance on maintaining detailed documentation related to suspicious activity monitoring and reporting. All records pertaining to identified suspicious activities, investigations, and SAR filings are retained in compliance with regulatory record-keeping requirements.

Our documentation practices ensure the preservation of crucial information for future reference, audits, and inquiries from regulatory authorities. By adhering to robust record retention standards, we demonstrate our commitment to transparency and accountability in our reporting procedures.

Through the diligent implementation of these reporting procedures, Zil Money ensures that suspicious activity is accurately reported, allowing us to play an active role in safeguarding the integrity of the financial system and protecting the interests of our valued customers and partners.

 

EMPLOYEE TRAINING AND CONFIDENTIALITY:

At Zil Money, we recognize the pivotal role that well-informed and vigilant employees play in our commitment to combatting financial crimes. This section outlines our comprehensive employee training program and emphasizes the significance of confidentiality in the suspicious activity reporting process.

  1. Training on Identifying Suspicious Activity:

We prioritize empowering our employees with the knowledge and tools required to identify and address potential suspicious activity. Through regular and specialized training sessions, employees are equipped with a deep understanding of the key indicators of suspicious behavior and the importance of prompt reporting.

Our training curriculum covers various aspects, including transaction monitoring, recognizing red flags, and the use of advanced software tools. By staying abreast of emerging threats and evolving risks, our employees are well-prepared to maintain a vigilant approach to suspicious activity identification.

  1. Reporting Obligations and Procedures:

Employees at Zil Money are encouraged to adopt a proactive approach to reporting potential suspicious activity. They are made aware of their obligations to promptly report any observed or suspected suspicious behavior to the designated AML compliance officer. Clear and straightforward reporting procedures are in place to facilitate seamless communication, ensuring that concerns are addressed without delay.

Our reporting procedures emphasize the importance of accuracy and completeness in providing information for SAR filings. Employees are encouraged to document all relevant details and supporting evidence to aid in the investigation process and enhance the efficacy of SAR reporting.

  1. Consequences of Breach of Confidentiality:

Confidentiality is of utmost importance in the suspicious activity monitoring and reporting process. Zil Money takes stringent measures to enforce confidentiality obligations on all employees involved in SAR reporting. Employees are required to sign confidentiality agreements, highlighting the sensitive nature of the information they handle.

Breach of confidentiality may lead to serious consequences, including disciplinary action and legal ramifications. Employees are educated on the potential repercussions of unauthorized disclosure of SAR-related information, emphasizing the need to maintain strict confidentiality to prevent tipping off potential criminals.

By fostering a culture of compliance and confidentiality, Zil Money ensures that our employees play a key role in the success of our suspicious activity monitoring and reporting program. Through continuous training and reinforcement, we reinforce our commitment to maintaining a secure and responsible financial ecosystem for the benefit of our customers and partners.

 

COLLABORATION WITH SERVICE PARTNERS:

Collaboration with our service partners is essential to our collective efforts in combating financial crimes and maintaining a secure financial ecosystem. This section outlines our approach to sharing Suspicious Activity Reports (SARs) with service partners including back-end banks and emphasizes effective communication and coordination procedures.

  1. Sharing Suspicious Activity Reports with Service Partners:

Zil Money acknowledges the critical role of service partners in enhancing the effectiveness of our suspicious activity monitoring and reporting program. We maintain open and transparent channels for sharing SARs with our service partners when necessary and permissible under applicable laws and regulations.

SAR sharing is conducted in strict adherence to the protocols established with our partner banks. Information shared is limited to what is essential for the service partner’s understanding and collaborative response to potential risks. The timely sharing of SARs ensures that service partners are equipped to take appropriate measures to safeguard their own ecosystems and protect mutual customers.

  1. Communication and Coordination Procedures:

Effective communication and coordination with service partners are paramount in addressing potential threats and suspicious activities. Zil Money ensures that lines of communication are clear and well-established with each service partner, enabling the seamless exchange of information.

In the event of joint investigations or further actions required, Zil Money maintains open lines of communication with service partner, facilitating real-time updates and collaboration. Regular meetings and consultations are held to discuss emerging risks and share best practices, fostering a collaborative and proactive approach to combating financial crimes.

By prioritizing collaboration with service partners, Zil Money strengthens its position as a responsible fintech platform, committed to upholding the highest standards of security and compliance. Our collaborative efforts contribute to a more resilient and secure financial landscape for the benefit of our customers and the broader financial community.

 

INTEGRATION WITH AML AND OFAC POLICIES:

At Zil Money, our commitment to compliance extends beyond the Suspicious Activity Monitoring and Reporting Guidelines. This section highlights the integration of our Guidelines with the “ANTI-MONEY LAUNDERING (AML) AND BANK SECRECY ACT (BSA) POLICIES AND PROCEDURES MANUAL” and the “OFAC POLICIES & PROCEDURES MANUAL.”

  1. Linkage to the “ANTI-MONEY LAUNDERING (AML) AND BANK SECRECY ACT (BSA) POLICIES AND PROCEDURES MANUAL”:

The “SUSPICIOUS ACTIVITY MONITORING AND REPORTING GUIDELINES” align seamlessly with the “ANTI-MONEY LAUNDERING (AML) AND BANK SECRECY ACT (BSA) POLICIES AND PROCEDURES MANUAL.” The Guidelines complement and enhance the AML compliance program by providing detailed procedures specifically focused on the identification, monitoring, and reporting of suspicious activities.

Key components of the AML and BSA Policies and Procedures Manual, such as SAR reporting requirements, investigation protocols, and record-keeping standards, are effectively incorporated into the Guidelines. By ensuring this linkage, Zil Money demonstrates its comprehensive approach to maintaining a secure and compliant financial platform.

  1. Alignment with the “OFAC POLICIES & PROCEDURES MANUAL”:

The “SUSPICIOUS ACTIVITY MONITORING AND REPORTING GUIDELINES” are fully aligned with the “OFAC POLICIES & PROCEDURES MANUAL.” This alignment ensures that our processes for identifying suspicious activities also encompass adherence to Office of Foreign Assets Control (OFAC) regulations and the screening of individuals and entities on government watchlists.

Zil Money’s integration with the OFAC Policies & Procedures Manual enables the swift identification and handling of potential sanctions-related risks, safeguarding the financial ecosystem from exposure to sanctioned parties and entities.

Through this seamless integration, Zil Money reinforces its commitment to maintaining a unified and robust compliance framework, encompassing AML, BSA, and OFAC requirements. By upholding these comprehensive policies and procedures, we fortify our position as a responsible and compliant fintech platform, earning the trust and confidence of our valued customers and partner banks.

 

INDUSTRY BEST PRACTICES:

As a forward-thinking fintech platform, Zil Money is dedicated to upholding industry best practices for Suspicious Activity Monitoring and Reporting. This section underscores our commitment to adhering to international standards and benchmarking against industry leaders to continuously enhance our compliance efforts.

  1. International Standards for Suspicious Activity Monitoring and Reporting:

Zil Money aligns its Suspicious Activity Monitoring and Reporting practices with internationally recognized standards to ensure a robust and effective compliance program. Our Guidelines incorporate principles from prominent regulatory bodies, including the Financial Action Task Force (FATF) and the Wolfsberg Group.

By integrating international standards, Zil Money upholds its commitment to adopting a global perspective in addressing financial crime risks. Our adherence to these standards enables us to operate with confidence across borders, collaborating with partners and customers worldwide.

  1. Benchmarking against Industry Leaders:

We continuously benchmark our Suspicious Activity Monitoring and Reporting practices against industry leaders and peers. This process involves assessing our procedures, methodologies, and technologies in comparison to recognized leaders in the payment processing industry.

By benchmarking, we gain valuable insights into emerging trends and evolving risks, allowing us to fine-tune our practices to stay at the forefront of compliance and fraud prevention. This iterative approach ensures that our Guidelines remain adaptive and responsive to the dynamic landscape of financial crime.

Through adherence to international best practices and benchmarking against industry leaders, Zil Money establishes itself as a progressive and proactive player in the fintech industry. Our commitment to continuous improvement underscores our dedication to providing a secure and reliable platform for our customers and partners.

 

CONCLUSION:

At Zil Money, we conclude our “SUSPICIOUS ACTIVITY MONITORING AND REPORTING GUIDELINES” with a resolute commitment to compliance and a dedication to continuous improvement. Our Guidelines represent the foundation of our comprehensive approach to combatting financial crimes and maintaining a secure payment processing ecosystem.

  1. Commitment to Compliance and Continuous Improvement:

These Guidelines epitomize Zil Money’s unwavering commitment to strict compliance with all applicable laws, rules, and regulations. By aligning with international best practices and integrating with our AML and OFAC policies, we strive to exceed the expectations of our partner banks and stakeholders.

We embrace a culture of continuous improvement, where we consistently seek ways to enhance our Suspicious Activity Monitoring and Reporting practices. Our vigilance in identifying emerging risks and benchmarking against industry leaders ensures that we stay ahead of evolving threats.

  1. Acknowledgment of Stakeholder Responsibilities:

We acknowledge that effective Suspicious Activity Monitoring and Reporting is a collaborative effort involving not only Zil Money but also our service partners, employees, and customers. We emphasize the importance of transparency and open communication to foster a sense of shared responsibility in detecting and reporting suspicious activities.

In conclusion, Zil Money reaffirms its dedication to upholding the highest standards of compliance and fostering a secure and responsible financial landscape. Through our “SUSPICIOUS ACTIVITY MONITORING AND REPORTING GUIDELINES,” we reinforce our commitment to safeguarding our customers, partner banks, and the global financial community.