Risk Appetite Statement
1st February 2022
Purpose and Scope
This document covers the risk appetite for the B4B Payments Group (“B4B”) including the following companies:
- Payment Card Solutions (UK) Limited t/a B4B Payments (05941947) (“B4B-UK”)
- UAB B4B Payments Europe (305539054) (“B4B-EU”)
- B4B Payments (USA) Inc (“B4B-US”) B4B-UK is authorised by the Financial Conduct Authority to conduct electronic money service activities under the Electronic Money Regulations 2011 (Ref: 930619). B4B-EU is authorised by the Bank of Lithuania as an Electronic Money Institution (Licence No: 76) under the Law on Electronic Money and Electronic Money Institutions 2011. B4B-US operates as a partner of Metropolitan Commercial Bank of New York. B4B provides corporate payment solutions including cards and bank transfers.. The purpose of this Anti-Money Laundering / Counter-Terrorist Financing (“AML/ CTF”) Risk Appetite Statement (the “Statement”) is to define B4B’s tolerance and the guiding principles governing Money Laundering and Terrorist Financing (“ML/TF”) risk identification, measurement, reporting, management and monitoring, as required by applicable laws in the countries in which it operates.. B4B also carries the reputational risk that some of its Clients process funds that are connected with Money Laundering or Terrorism Financing activities.
B4B Payments Risk Appetite Statement
B4B maintains a zero tolerance for regulatory/compliance risk exposure. B4B ensures that it adopts all regulatory, legal requirements and compliance requirements in a proportionate way that satisfies the requirements of the local regulatory authorities in a pragmatic and cost effective manner. The on-going cost of compliance is a cost of doing business and should not be material in terms of annual income. It aims to comply with all regulatory requirements and thus avoid any penalties. B4B also maintains a zero tolerance for ML/TF risk. B4B is obliged to transact its business so as to ensure it minimizes the risk of its systems and processes being used for ML or TF purposes. B4B has a risk appetite and practices which place it at the ‘best practice’ end of international standards, in relation to preventing Money Laundering and Terrorism Financing abuses. B4B has strict and transparent standards and continuously seeks to strengthen its processes to ensure compliance with all applicable laws and regulations. B4B reserves the right to reject any client, payment, or business that is not consistent with its Risk Appetite.
B4B does not onboard, nor will it process any payment flows, for the following:
- Groups, legal bodies or similar subject to international sanctions or embargoes, in particular as issued by the HM Treasury (UK), the European Union (“EU”), the United Nations (“UN”) or the US Office of Foreign Assets Control (“OFAC”) including the List of Specially Designated Nationals and Blocked Persons.
- “Non-standard” or “non transparent” activities – those carried out through special-purpose or assimilated legal entities (special purpose vehicles) (structures) or in jurisdictions that impede transparency or which do not meet international banking standards.
- Shell banks; (banks based in countries where they have no physical presence involving decision-making and management and which are typically not connected to wider regulated financial groups).
- Bearer share corporations and companies
- Physically present Adult Services; Escort services, sale and/or advertising or suggestion of sexual services that may imply or suggest prostitution.
- Unregulated or offshore holding/investment companies involved in managing or investing own- or third-party funds.
- Weapons of war, automatic weapons, ammunition or defence equipment: Includes merchants involved in the sales, intermediation or commerce of war or automatic weapons, including but not limited to chemical weapons, cluster bombs, ammunitions, or other defence equipment or similar.
- Virtual Currencies / Crypto Asset firms (i.e. firms engaged in exchange services between virtual currencies and fiat currencies).
- Any involvement in the sale or marketing of Binary Options
- Any business involved with Cannabidiol “CBD”
High-risk clients requiring enhanced due diligence
The risk presented by the following types of industries is considered as ‘high risk’. For these categories (not limited to), B4B reserves the right to ask for additional documents during the relationship to better understand the nature of the business of the client.
● Adult content, adult entertainment, Dating or pornography businesses.
- Have no suggestions of escort services, or the sale of physically present sexual services (solicitation/prostitution)
- Have no material negative media which could result in material reputational damage for B4B Payments;
● Be incorporated within the UK, North America or Europe
● Charities, social service organisations and other non-profit or political organisations;
- These institutions must be registered, or local equivalent, in the country of incorporation.
- The organisation must not be located in high-risk countries (as defined by B4B Payments. For the latest list please contact your account manager or sales contact).
- The organisation must not sponsor or support any act of violence or hate.
● Affiliate Marketing schemes, including network marketing, referral marketing, multilevel marketing.
- Not be established as a multilevel scheme for the purpose of circumventing credit card schemes rules;
- Comply, in letter and in practice, with distant marketing or online selling legislation, including US negative option features and EU withdrawal rights, or equivalent
- Not engage in aggressive tax planning or transfer pricing, make use of nominees or similar structures to hide or mask true beneficial ownership of the entities involved in the scheme;
- Not have unfair pricing or charges, or withdrawal/cancellation rights that cannot be effectively exercised without unfair costs or penalties.
- Acceptable jurisdictions are Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Gibraltar, Greece, Greenland, Hungary, Isle of Man, Italy, Latvia, Malta, Poland, Portugal, Romania (subject to the PSP holding 2nd Class Gambling license), Spain, Slovakia, Sweden and the United Kingdom. Note: the firm must have a relevant license where they are established or provide services, including by means of a website in a country-specific language.
- Accepted activities are online gambling, betting, poker, sport, horse racing, skill games (except for Portugal where such activity is prohibited), casinos, lottery, arcades.
Restricted Client Types and Restricted Payment Flows
B4B has placed certain restrictions on the client types below:
● Crowdfunding, crowdlending and similar activities businesses. These must:
- Hold the appropriate license in the country or territory where they are established and provide services to;
- Have three full years or more track record; and
- Be established within the countries permitted for correspondent relationships.
● Drugs and pharmaceuticals (includes any drug paraphernalia, pseudo-pharmaceuticals, substances designed to mimic illegal drugs, and any other associated product, service or equipment.) These must:
B4B Risk Appetite Statement (for B4B website)
- Possess the appropriate licenses in those jurisdictions where they are established or sell products into;
B4B Risk Appetite Statement (for B4B website)
● Precious metals and stones, arts and antiques, other valuable commodities, sale of vehicles or other merchants dealing with high-value goods. These must:
- Have Enhanced Due Diligence applied to mitigate the increased risk these industry types present.
● Weapons (i.e. knives and accessories for weapons intended for hunting, fishing and recreational activities; antique weapons or collectables). These must:
- Be evidenced to be for legitimate sport or recreational activities and not for military or dual-use purposes.
● Financial services firms:
- Clients must be licensed in a permitted country as defined by B4B.