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12.13. Money Laundering Prevention

Investors should note that the Manager may refuse to accept a subscription request if it is not accompanied by such additional information as they may reasonably require, including without limitation information required for money laundering verification purposes.

Pursuant to applicable Cyprus laws and regulations comprising but not limited to the Prevention and Suppression of Money Laundering Activities Law of 2007 (Law 188(I)/2007) as this may be amended from time to time and the Directive DI144-2007-08 of 2012 for the Prevention of Money Laundering and Terrorist Financing and any CySEC Directives and circulars issued from time to time, the Investment Compartment must comply with anti-money laundering and financing of terrorism procedures. 

As a result, the Fund must principally ascertain the identity of the subscriber and beneficial owners in accordance with Cyprus laws and regulations. The Fund may require subscribers to provide any document it deems necessary to effect such identification. In any case of delay or failure by an applicant to provide the required documents, the application for subscription will not be accepted.

Neither the Administrator nor the Fund or the Manager shall have any liability for delays or failure to process deals as a result of the applicant providing no or incomplete documentation.

Investors may be requested to provide additional or updated identification documents from time to time pursuant to ongoing client due diligence requirements under relevant laws and regulations as well as internal requirements.

The Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2007, No.188 (I)/2007, as amended (the “Money Laundering Law”) and Directive DI144-2007-08 of 2012 for the Prevention of Money Laundering and Terrorist Financing contain provisions intended to define and criminalise the laundering of the proceeds generated from all serious criminal offences and provides for the confiscation of such proceeds aiming at depriving criminals from the profits of their crimes. 

The Anti - Money Laundering Law makes it an offence for any person to provide assistance to another person to obtain, conceal, retain or invest funds if the person knows or suspects, or should have known or suspected, that the funds are the proceeds of criminal conduct. Criminal conduct is defined to include homicide, drug and arms trafficking, appropriation of money by illegal means, dealing in stolen goods, and corruption by public officials, etc. The offence of assisting in money laundering carries a penalty of 14 years’ imprisonment or a fine or both. It is a defense that the person concerned reported his knowledge or suspicion to the police or to his employer at the first available opportunity. 

In addition, the Money Laundering Law contains specific provisions intended to prevent money laundering in the financial sector. It is therefore a criminal offence punishable by up to 14 years of imprisonment or a penalty of up to €500.000,00 or both, for the Fund to enter into any contract or relationship with an Investor unless the Manager:

1. Applies acceptable procedures in relation to client identification and record keeping; 

2. Maintains appropriate internal control and communication procedures and 

3. Ensures that the Manager’s employees and affiliates are educated and trained in applying these procedures in the exercise of their duties. 

The purpose behind such procedures is to ensure that money laundering by the Fund’s clients is detected and prevented. By ensuring compliance with the requirements of the Anti-Money Laundering Law, through the appointment of Compliance Officer, who will be also responsible for the Anti-money laundering issues and reporting to the Unit of combating Money Laundering any knowledge or suspicion as to money laundering, the Fund will avoid any liability for the concealment of money laundering.