Compliance and Anti-Money Laundering (AML) Policy

Updated

Website: https://zweigadvisory.com

Joint Legal Entities ("Zweig Advisory," "we," "us," "our"): This Compliance and Anti-Money Laundering (AML) Policy applies to all activities, employees, subsidiaries, and third-party agents of the Joint Legal Entities globally.

  • Zweig Services and Asset Management GmbH (German/EU Entity)
  • Zweig Cost Control & Risk Management Services EST. (UAE Mainland Entity)

Strategic Commitment: The Highest Common Denominator (HCD) Standard

Zweig Advisory maintains an absolute Zero Tolerance policy toward all forms of financial crime, including Money Laundering (ML), Terrorist Financing (TF), Proliferation Financing (PF), bribery, and corruption.

Given our operations across the EU/Germany and the UAE, and the global reach of certain sanctions regimes (e.g., US OFAC), we apply the Highest Common Denominator (HCD) Standard. This means that in any instance where the requirements of applicable laws conflict, we adopt the strictest standard, procedure, or regulatory obligation to ensure maximum institutional resilience and legal protection.

1. Governance and Legal Framework

Our Compliance Program is built on the synthesis of the world's most stringent regulatory frameworks:

Jurisdiction Applicable Law Key Compliance Requirement
EU / Germany German Anti-Money Laundering Act (GwG), 6th AMLD (Directive (EU) 2024/1640) Harmonization of Predicate Offenses: Explicitly addressing 22 predicate offenses, including cybercrime and environmental crime. Extended Liability: Criminal liability extends to legal persons for employee misconduct.
UAE Mainland Federal Decree-Law No. 20 of 2018 on AML/CTF Scope Expansion: Explicit inclusion of Countering Proliferation Financing (PF) and Tax Evasion (direct and indirect) as predicate offenses.
United States Foreign Corrupt Practices Act (FCPA), OFAC Regulations Anti-Corruption: Strict internal accounting controls to prevent foreign bribery. Sanctions: Adherence to the global reach of US sanctions, including the Jurisdictional Nexus.

2. Anti-Money Laundering and Counter-Terrorist Financing (AML/CTF)

2.1. Risk Assessment and Management

We maintain an institutional, dynamic, and documented Risk Assessment process that covers geographical, client, product, and channel risks. This assessment is continuously reviewed to incorporate new typologies, particularly those related to the predicate offenses defined under the 6th AMLD and the UAE's expanded scope (e.g., cybercrime, tax evasion).

2.2. Internal Controls and Training

Designated Officer: Zweig Advisory ensures the appointment of an adequately skilled Money Laundering Reporting Officer (MLRO) or equivalent role (Geldwäschebeauftragter in Germany) with direct access to Senior Management.

Employee Training: All relevant staff undergo mandatory, structured, and continuous training tailored to their roles, focusing on the latest regulatory changes, typologies, and identification of suspicious activity.

Health Checks: Regular, independent internal checks are performed to assess the effectiveness and identify any "soft spots" in the compliance organization.

2.3. Transaction Monitoring and Reporting

We implement risk-based Transaction Monitoring systems designed to detect anomalous patterns and transactions inconsistent with a client's established risk profile, volume, and known activity. All employees have an absolute and immediate obligation to report any actual or suspected financial crime activity (STR/SAR) to the competent authorities (e.g., UAE Financial Intelligence Unit via GoAML, or the German FIU).

3. Know Your Customer (KYC) and Due Diligence

3.1. Customer Due Diligence (CDD) Standard

Adhering to the HCD Principle, we enforce a Zero Threshold for Customer Due Diligence (CDD). KYC is mandatory for the establishment of any business relationship, irrespective of transaction value or specific jurisdictional thresholds.

CDD includes identity verification, understanding the nature and purpose of the business relationship, and ongoing monitoring using reliable, independent source documents.

3.2. Politically Exposed Persons (PEPs) and Enhanced Due Diligence (EDD)

EDD is an essential component of our program and is automatically triggered for all high-risk relationships, including:

  • PEPs: Politically Exposed Persons (foreign and domestic) and their close relatives or associates.
  • High-Risk Triggers: Clients linked to high-risk geographies or jurisdictions, complex or opaque corporate structures, or those presenting risks related to the expanded predicate offenses (e.g., tax evasion, cybercrime).

PEPs HCD Requirements: Establishing or maintaining a relationship with a PEP requires the mandatory written approval of Senior Management. We apply enhanced, ongoing monitoring to all PEP relationships.

3.3. Source of Funds (SoF) and Source of Wealth (SoW) Verification

For all high-risk clients, EDD includes taking reasonable, documented steps to verify both the Source of Funds (SoF—the specific transaction funds) and the Source of Wealth (SoW—the client's total financial standing).

HCD Documentary Evidence: We require independent documentation to corroborate SoF/SoW. Unverified verbal explanations are insufficient. Acceptable documentation includes audited financial statements, tax returns, trust deeds, court orders, or official sale/purchase agreements.

4. Anti-Bribery and Anti-Corruption (ABC) Policy

Zweig Advisory enforces a strict zero-tolerance policy against all forms of bribery and corruption, aligning with the stringent extra-territorial reach of the US FCPA and the UK Bribery Act.

Scope: The prohibition covers both the public sector (Government Officials) and the private sector (commercial bribery), extending globally.

Criminal Liability: We acknowledge the serious risk of criminal liability for the failure to prevent bribery (UK Bribery Act principle) and for actions of employees (6th AMLD principle).

Accounting Controls: In line with FCPA accounting provisions, the firm is required to maintain books and records that accurately and fairly reflect all transactions and dispositions of assets, ensuring an adequate system of internal accounting controls.

4.1. Gifts, Hospitality, and Entertainment (HCD Four-Part Test)

All expenditures related to gifts, hospitality, and entertainment must satisfy the following four HCD criteria:

  1. Bona Fide: Must have a legitimate, clear business purpose and not be intended to secure an improper advantage.
  2. No Undue Influence: Must not create an obligation or expectation of influence on the recipient's decision.
  3. Openly Documented: Must be fully and transparently recorded (purpose, recipient, value, and approval).
  4. Public Officials: Expenditures involving Government Officials require mandatory, documented pre-approval by the Compliance Department due to the heightened risk of bribery.

5. Global Sanctions Compliance

We are absolutely committed to complying with all applicable sanctions laws and restrictive measures imposed by the United Nations (UN), the European Union (EU), the UK (HMT), and the United States (OFAC).

5.1. Jurisdictional Nexus and Sanctions Screening

Nexus Principle: Zweig Advisory recognizes that, even as a non-U.S. Person, our activities may create a Jurisdictional Nexus with the United States. We strictly prohibit any activity that could cause, facilitate, or conspire to violate U.S. sanctions by any U.S. Person.

The 50 Percent Rule: Our screening process mandates an aggregated ownership analysis. We treat any entity owned, directly or indirectly, 50% or more by one or more blocked persons (SDNs) as a blocked person itself, even if that entity is not listed on the SDN list.

Screening: All prospective and existing clients, beneficial owners, and material third parties are continuously screened against the OFAC SDN List, EU Consolidated Sanctions Lists, and UN lists to prevent asset freezing or prohibited transactions.

6. Contact and Entities

Any breach or suspicious activity must be reported immediately to the Compliance Department.

Joint Legal Entities and Registered Addresses:

Entity Registered Address Primary Jurisdiction
Zweig Services and Asset Management GmbH Potsdamer Straße 92, 10785 Berlin, Germany EU/Germany
Zweig Cost Control & Risk Management Services EST. Westburry Tower 1, Business Bay, Dubai | UAE UAE Mainland

Central Email Contacts:

Approval

This Compliance and AML Policy has been approved by the Senior Management of Zweig Advisory.

Signed by:

Name: Margarita Zweig, Alexander Zweig
Title: Managing Directors