Compliance Policy

Corporate Governance and Compliance Oversight

Compliance activities at Paribu Custody are conducted under a robust corporate governance framework. The Board of Directors is responsible for determining the institution's financial crime prevention policies, establishing the compliance framework, and overseeing the effective implementation of these policies and controls.

The Board regularly evaluates the effectiveness of the compliance program to ensure that emerging risks are properly managed and that necessary strategic decisions are taken accordingly. The institution's risk management approach is continuously monitored by senior management through regular reporting mechanisms and internal control processes.

The day-to-day execution of compliance activities is carried out by the Compliance Officer, the Deputy Compliance Officer, and the relevant compliance team members who possess the qualifications required under applicable regulations. The compliance function is structured as an independent function within the organization and is supported with the necessary authority and resources.

In addition, Paribu Custody adopts the Three Lines of Defense model, which is widely applied within international financial institutions. Under this framework, operational and business units constitute the first line of control, compliance and risk management functions represent the second line of control, and internal audit activities form the third line of control. Through this structure, the institution's activities are regularly reviewed and the effectiveness of control mechanisms is continuously assessed.

Risk-Based Approach

Paribu Custody conducts its financial crime prevention activities in line with a risk-based approach. Within this framework, various factors such as customers, transactions, products and services, geographical elements, and technological infrastructure are assessed to determine potential risk levels.

The risk-based approach allows the institution to apply different levels of control for customers and transactions with varying risk profiles. Accordingly, customer onboarding processes, the level of customer due diligence applied, transaction monitoring mechanisms, and additional control procedures are differentiated based on the identified risk level.

Risk assessments are not limited to the customer onboarding stage. They are also reviewed periodically throughout the duration of the business relationship. Changes in customer profiles, unusual transaction behaviors, or newly emerging risk indicators may trigger updates to the risk assessment.

This approach aims to ensure the effective management of emerging risks within the crypto-asset ecosystem and to minimize financial crime risks.

Customer Onboarding and Customer Due Diligence

Paribu Custody applies comprehensive customer identification and verification procedures during the customer onboarding process. Before establishing a business relationship with the institution, customer identity information is verified and the necessary due diligence procedures are completed.

While know your customer (KYC) processes are applied for individual customers, know your business (KYB) evaluations are carried out for corporate customers. Within these processes, factors such as the customer's business activities, ownership structure, management structure, and control mechanisms are evaluated in order to determine the customer's risk profile.

In business relationships established with corporate clients, identifying the ultimate beneficial owners is of critical importance. In this context, Paribu Custody examines the customer's ownership structure, evaluates direct and indirect shareholding relationships, and conducts necessary reviews to determine the ultimate beneficial owners.

Where risk indicators are identified, the institution may apply enhanced due diligence (EDD) procedures. Within these processes, the customer's activities, transaction purposes, source of funds, and geographical risk factors are assessed in greater detail.

Crypto-Asset Transfer Controls and Transaction Monitoring

Paribu Custody applies multi-layered control mechanisms to ensure that crypto-asset transfers are conducted securely and in compliance with applicable regulations.

Transfer processes consist of several stages, including verification of customer instructions, address checks, transaction risk analysis, and the application of additional verification procedures where necessary. Crypto-asset addresses used in transfers are assessed from both transaction security and financial crime risk perspectives and are analyzed in line with relevant risk indicators.

Where risk indicators are detected, the relevant transactions may be subject to further review and may be temporarily suspended until the necessary checks are completed.

Paribu Custody also implements processes that support obligations under the Travel Rule, in accordance with international and local regulatory standards. Within this framework, certain information regarding the parties involved in specific transfer transactions is securely shared and recorded as required.

In addition, Paribu Custody continuously monitors transaction activities in order to detect potential financial crime risks. Customer transactions and behavioral patterns are analyzed using various risk indicators, and unusual activities are subject to further examination.

Risk indicators identified during monitoring activities may trigger detailed investigation processes when necessary. In cases where suspicious activity is suspected, the institution conducts the required examinations in accordance with applicable regulations and fulfills its reporting obligations to the relevant authorities.

These processes play a critical role in safeguarding the financial system and preventing the laundering of illicit proceeds.

Cooperation with Regulatory Authorities and Transparency

Paribu Custody places significant importance on cooperation with regulatory authorities while conducting its operations. The institution ensures that all required records are maintained in accordance with applicable regulations and that the information and documentation requested by relevant authorities are duly provided.

The information presented on this page has been prepared to provide a general overview of Paribu Custody's compliance approach. In addition, Paribu Custody cooperates with relevant authorities in supervisory and investigative processes conducted in accordance with applicable regulations.