Anti-Money Laundering (AML)

Policy Manual for the Prevention of Money Laundering and Terrorist Financing Crimes

Purpose of the Policy

This document is permanent in nature, in accordance with 4P Finance's Risk & Compliance (R&C) standards and following the provisions of Law No. 9,613/1998, which typifies the crime of money laundering or concealment of assets, rights, and values, and institutes measures that confer greater responsibility to entities that make up the financial system; and its amendments with the approval of Law No. 12,683/2012, as well as the following legislations/regulations:

Central Bank

• Circular BC No. 3,978/20: Provides procedures to be adopted in the prevention and combat of activities related to the crimes provided for in Law No. 9,613/98;
• Circular BC No. 4,001/20: Publishes a list of operations and situations that may indicate the occurrence of crimes of laundering or concealment of assets, rights, and values, as dealt with in Law No. 9,613, of March 3, 1998, and terrorist financing, provided in Law No. 13,260, of March 16, 2016, subject to communication to the Financial Activities Control Council (Coaf);
• Circular BC No. 3,461/09: Consolidates the rules on procedures to be adopted in the prevention and combat of activities related to the crimes provided for in Law No. 9,613/1998.

Securities and Exchange Commission (CVM)

• CVM Instruction No. 301/99: Provides for identification, registration, operations, communication, limits, and administrative responsibility regarding crimes of laundering or concealment of assets, rights, and values; and its amendments;
• CVM Instruction No. 617/19: Provides for identification, registration, operations, communication, limits, and administrative responsibility regarding crimes of money laundering and terrorist financing.

Other Institutions

• Norms issued by COAF (Financial Activities Control Council);
• Integrity Manuals of the Office of the Comptroller General (CGU);
• FATF Recommendations: International Standards on Combating Money Laundering and the Financing of Terrorism and Proliferation;
• Issues, Risks, and Regulatory Considerations related to Crypto-Asset Trading Platforms – IOSCO.

The content of this document may be modified at any time, according to legal and regulatory needs, as well as due to updates of 4P Finance's standards. This Policy will be archived on our servers and displayed on the Company's website. 4P Finance professionals should consult the latest available version whenever necessary.

Scope of the Policy

The legal and regulatory responsibilities for combating and preventing money laundering encompass the organization of 4P Finance. All employees, partners, directors, and individuals directly or indirectly linked to 4P Finance are responsible for compliance with the norms and AML controls.

Policy Requirements

I. Introduction and Objectives

The crime of money laundering is characterized by a set of commercial or financial operations that seek the incorporation into the economy of each country, either temporarily or permanently, of resources, assets, or values of illicit origin, developed through a dynamic process including, theoretically, three independent phases that often occur simultaneously:

Placement

The first stage of the process is the 'placement' of money into the economic system. To conceal its origin, the criminal seeks to move the money in countries with more permissive rules or that have a less strict financial system. Placement is carried out through bank deposits, the purchase of negotiable instruments, or even the purchase of goods. To complicate the identification of the money's origin, criminals apply sophisticated and increasingly dynamic techniques, such as splitting the amounts that pass through the financial system and using commercial establishments that usually handle cash.

Layering

The second stage consists of making it difficult to trace the illicit resources. The purpose is to disguise the chain of evidence in the event of investigations into the money's origin. Criminals seek to move it electronically, transferring assets to anonymous accounts—preferably in countries protected by bank secrecy laws—or making deposits into 'phantom accounts.'

Integration

In this final stage, the assets are formally incorporated into the economic system. Criminal organizations aim to invest in ventures that facilitate their activities, and such entities may provide services to each other. Once the chain is formed, it becomes easy to legitimize resources of illicit origin.

On March 3, 1998, Brazil, continuing its international commitments assumed from the signing of the 1988 Vienna Convention, approved the Money Laundering Law (Law No. 9,613/98), later amended by Law No. 12,683/12.

Under the new law, it constitutes the crime of laundering or concealment of assets, rights, and values to hide or disguise the nature, origin, location, disposition, movement, or ownership of assets, rights, and values derived directly or indirectly from a criminal offense.

The penalty is imprisonment for three (3) to ten (10) years, plus a fine.

The aforementioned entities were required to comply with a series of legal obligations, such as:

• Institution of an internal prevention policy;
• Process of client identification and their operations;
• Identification of ultimate beneficiaries;
• Registration of the company with the Financial Activities Control Council (COAF);
• Obligation to report to COAF operations that may constitute serious indications of money laundering crimes.

Sanctions were defined to be imposed on companies and administrators in cases of non-compliance with these legal obligations, namely: warning, pecuniary fine, temporary disqualification, revocation of operating authorization, imprisonment without the right to bail or provisional release, seizure of assets, rights, and values.

Based on the laws, resolutions, instructions, and other regulations on the AML subject, 4P Finance structured this Manual of Policies and Procedures for the Prevention and Combat of Money Laundering Crimes, highlighting the measures that must be adopted to combat, prevent, and report such crimes.

Guidelines, Responsibilities, and Target Audience

The legal and regulatory responsibilities for combating and preventing money laundering encompass all of 4P Finance, nationally or internationally. Employees, directors, and partners are responsible for compliance with the norms and AML controls.

The guidelines of 4P Finance's AML Policy are:

• Adopting measures that enable the optimization of the prevention program against money laundering, terrorist financing, corruption, and other illicit activities;
• Promoting practices to establish an organizational culture of prevention against money laundering, terrorist financing, corruption, and similar illicit activities;
• Using procedures to identify and approve the continuity of business relationships with clients, partners, and service providers that may be categorized as Politically Exposed Persons (PEP) or related to them, including a comprehensive risk assessment and special focus on operations involving PEPs, their families, close associates, and companies in which they participate;
• Utilizing internal systems to record and supervise transactions, identifying suspicious cases with configurable rules, developing and implementing control tools to ensure that fund transfers occur between client accounts whose identity and authenticity have been previously verified;
• Analyzing capture solutions, payment methods, frequency, involved parties, amounts, transaction patterns, and economic activities in transaction analyses to identify suspicious indicators;
• Expressing opposition to practices of money laundering, terrorist financing, corruption, and other illicit activities;
• Conducting internal assessments to detect and measure the risk of using products and services in illicit activities;
• Incorporating processes to develop and improve products and apply new technologies to assess risks and determine preventive measures;
• Regularly reviewing the guidelines of this policy or whenever process changes impact or justify a review.

Policy Application

4P Finance adopts procedures defined in Governance, Risk & Compliance practices such as Know Your Client (KYC), which consist of establishing a set of rules aimed at obtaining information about potential clients. 4P Finance will request the registration of all users on its platform, with an individual risk assessment of each registered client. Transfers of funds should only be made from bank accounts matching the registered CPF or CNPJ. Only transactions made through PIX will be accepted.

Cases of Identified Occurrences

Suspicious facts of involvement in criminal activities must be recorded as an 'Anti-Money Laundering Case' and communicated to 4P Finance's partners and legal advisors.

Level-Based System

4P Finance classifies the risk level of user operations into levels: green, yellow, and red flag, and may alter the classification according to the user's profile.

Procedures

To use the platform, the user must register and provide the necessary identification documents according to the risk level. The 'Know Your Client' process is fundamental to ensure regulatory compliance.

Transaction Recording

4P Finance maintains a record of all transactions performed, providing information to competent authorities when necessary.

Periodic Evaluation

4P Finance conducts periodic evaluations of this policy to ensure its effectiveness in light of regulatory changes and emerging threats.

Prevention Programs and Training

All employees are periodically trained on this policy to ensure full compliance.

Validity and Amendment

This policy comes into effect on the date of its approval and may be modified, revoked, or updated at any time by the Compliance Committee.