BSA-AML Examiner School Case Study eBook

Internal Use Only

BSA/AML Policy and Program

1. INTRODUCTION The Bank Secrecy Act/Anti-Money Laundering and Sanctions Policy (the “Policy”) and Program (“BSA/AML/OFAC Policy/Program” or “Policy/Program”) establishes the fundamental principles and core processes that TS&J Bank (“TS&J” or “the Bank”) uses to identify, measure, monitor and control financial crime risk. It also sets how TS&J complies with the laws, regulations, and guidelines designed to prevent, detect, and report money laundering, financial crimes, sanctions evasion, and terrorist financing. TS&J and its Board are committed to deterring customers and outside parties from using the Bank and its Third Parties as a conduit for illegal activity and to identify and report, as appropriate, those customers and card holders who may be engaging in such activity. The Bank recognizes that the banking services TS&J offers, which include its TS&J BaaS Solutions Platform, could pose the risk of money laundering and other financial crimes, and will therefore maintain controls commensurate with the risks of the services it offers. 2. POLICY OBJECTIVES This Policy / Program seeks to establish the core elements of a sound BSA / AML / OFAC Program for TS&J, aligned with the Bank’s broader Enterprise Risk Management Policy. Specifically, this Policy/Program: ● Defines roles and responsibilities for TS&J’s BSA / AML / OFAC program; ● Creates an AML risk assessment process; ● Outlines TS&J’s BSA / AML / OFAC internal control processes; ● Creates a Know Your Customer (“KYC”) framework that provides for risk- based customer identification, verification and due diligence; ● Ensures an appropriate level of ongoing Customer Due Diligence (“CDD”) and Enhanced Due Diligence (“EDD”) for customers and others using Bank services; ● Creates a risk-based transaction monitoring and suspicious activity reporting program including both automated transaction monitoring and staff reviews and referrals; ● Establishes controls to ensure compliance with Office of Foreign Asset Control (“OFAC”) requirements; ● Establishes a process to ensure adherence to all government requirements, including filing of suspicious activity reports, responding to information requests, and maintenance of records;

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Confidential