This Policy was formulated by SwapzHub LLC (“Swapz”) with a holistic approach to mitigate risk arising from the type and nature of the Swapz platform’s activities. This Policy and the relevant operational risk management procedures will be reviewed on a yearly basis, or sooner in the event of an applicable regulatory or legislative update or significant policy incident. Swapz recognises the risk emanating from its line of business and it can be broadly grouped into four categories, namely:

  • The client base (“Customer”)
  • The geographic location of such clients (“Geography”)
  • The nature of its product offering (“Product”)
  • The non-face-to-face relationship it maintains with its clients (“Interface”)

Across these four categories, we have identified various risk factors and the associated mitigating measures which form an integral part of our AML-CFT Policy. These are detailed in the sections to follow.

Risk Factors

Customer and Geography

The varied nature of its clients/users may pose a risk for Swapz. There are risks wherein Swapz may be approached by potential clients/users associated with illicit activities, and the jurisdictions clients/users are domiciled or registered in, where the funds are flowing to and from. Various global lists single out countries, which have been identified as having structural deficiencies in preventing the flow of illicitly obtained funds. Furthermore, geo-political or human rights issues may lead to partial or blanket bans on financial flows from certain companies or countries.


The pseudonymous nature of digital tokens may attract bad actors or somewhat facilitate the task of laundering proceeds of crime or financing of terrorism. Furthermore, the general irreversibility of transactions may attract a higher degree of scammers and fraudsters.


The non-face-to-face client interface may pose a challenge. Risks are also brought about through the speed of propagation of an online transaction – or indeed a chain of online transactions – typically measured in seconds. The pseudonymous nature of digital tokens could present some hurdles in ascertaining whether the client/user actually has an element of ownership or control over the wallet or address they are transacting to or from.

Mitigating Measures

Customer and Geography

Swapz may face risks due to the diverse range of clients and users it interacts with. There is a possibility that some potential clients or users could be involved in illegal activities, and it is important to consider the jurisdictions where these clients or users are located and where the funds are originating from and flowing to. Certain countries are identified on global lists as having insufficient measures in place to prevent the flow of illegally obtained funds. Additionally, political and human rights issues can result in restrictions on financial flows from certain countries or companies.


Swapz will conduct random checks on the addresses that have been utilized by its clients/users once the transactions have been completed to identify any potential link to unlawful activities.


Due to the non-face-to-face nature of Swapz's business, there is a higher risk of encountering clients/users associated with illicit activities. In such cases, Swapz reserves the right to use data collection methods to identify any client/user linked to suspicious activities.

Update and Preservation of Records and Personal Data Provisions

Swapz maintains records of all relevant client/user information and transaction details. The processing of personal data is carried out in compliance with the Swapz Privacy and Cookie Policy. The stored information can be accessed and shared with relevant authorities within 48 hours if necessary.

Authority Request Procedure

Request and Escalation

In the event that a regulatory or criminal authority makes a motivated request for information related to a particular client/user or wallet address, Swapz will comply as necessary and release any information that has been collected. Following this, Swapz will monitor the platform for any further transactions associated with that wallet address and take appropriate action, including freezing or blocking any new transactions.

To unblock the transaction and release any digital tokens involved, the client/user must first complete the necessary Customer Due Diligence procedures outlined below, or follow the instructions of the relevant authority.

Customer Due Diligence

For all and any of its clients/users affected by a temporary block on a pending transaction, Swapz will require the following documentation:

For Corporate Entities

  • Certificate of Incorporation
  • Corporate Address Verification
  • Extract from Company Register for Going Concern / Certificate of Good Standing
  • Extract from Shareholder & UBO Register
  • Latest Memorandum & Articles of Association
  • Company Organigram up to UBOs and/or Ultimate Parent
  • Director/s and UBO/s Photo Identification
  • Director/s and UBO/s Address Verification

These documents must be photos or scan of originals, or true copies of such originals whenever possible. For Identification for representatives, Directors and UBOs, Swapz will ask for one (or more if applicable) of the following;

  • Passport
  • National Identity Card
  • Driver’s License
  • Residence Card

The document must follow the below guidelines:

  • Clear, legible and durable, in full colour only
  • Photo/Scan of both sides of the document, where applicable
  • Must contain the date of birth
  • Must still be valid/in date

Temporary work permits or paper ID cards are generally not accepted as forms of photo identification. However photographic evidence of identity that are not government-issued but which are nonetheless recognised as a legal means of identification by the national law of Singapore or an equivalent reputable jurisdiction may also be used to verify the identity of the representatives, Directors and UBOs, provided that such documents are valid and unexpired.

Identity documents are fed to a 3rd party provider which will verify the legitimacy of such documents against known templates using optical character recognition software and checks for security features and evidence of tampering. This review is carried out in conjunction with a manual review by Swapz internal compliance staff.

For Residential Address Verification for company representatives, Directors and UBOs, Swapz looks to receive one of the following;

  • Bank/Credit Card Statement
  • Utility Bill
  • Correspondence by central or local Government authorities, departments or agencies

The document must follow the below guidelines:

  • Clear and legible, and in colour where possible
  • Photo/Scan of the full document/file
  • Dated within 90 days from the day of submission
  • Must state the full name and address

In cases where the residential address country differs from the one specified on the photo ID (if at all), supporting documentation may be requested in the form of a residency card or a work permit or an additional proof of address.

For individuals/natural persons

The same requirements outlined for identifying UBOs, including proof-of-identity and proof-of-address, will apply to individuals or natural persons.

PEP and Sanctions Checks

If there are any matches found for politically exposed persons (PEPs) or client/users deemed high-risk, Swapz will require them to undergo enhanced due diligence (EDD) in addition to the identity and address verification requirements mentioned above. The details of EDD measures are explained in the following section.

Enhanced Due Diligence

Enhanced Due Diligence may be triggered by a number of events. A non-exhaustive list of such events includes:

  • Company representatives, Directors and UBOs identified as PEPs or sanctioned individuals
  • Clients identified as High-Risk after a review of their documentation
  • Clients exhibiting suspicious buying patterns
  • Clients sending digital tokens to high-risk wallets

Once triggered, Swapz will require clients to provide additional information and documentation regarding their:

  • Intended Use for Bitcoin
  • Corporate Structure (if applicable)
  • Source of Company/Personal Funds
  • Source of Wealth

If there are any matches found for politically exposed persons (PEPs) or client/users deemed high-risk, Swapz will require them to undergo enhanced due diligence (EDD) in addition to the identity and address verification requirements mentioned above. The details of EDD measures are explained in the following section.

Restricted Countries and jurisdictions

Swapz reserves any and all rights to freeze or block any transaction that it suspects to be connected or originating from any U.N. Sanction list individual or Country, on top of the U.S. During a Customer Due Diligence, in the cases when it is performed, the client/user will be rejected if being listed or a resident/citizen of the U.S., any U.N. Sanction list, FATF blacklist and the SVG FSA blacklist.