This Anti–Money Laundering (AML) and Know Your Counterparty (KYC) Policy (“Policy”) explains how Energy Marketing and Trading Ltd (“EMT”, “we”, “us”, “our”) manages financial crime risks in connection with the Fluyt brand and Pilot trading programme. This Policy applies to all Clients and prospective Clients (“you”).
Environmental certificate markets move quickly. Criminals favour fast-moving, cross-border markets. That means AML cannot be a background process: it must be a front-line discipline. We take a zero-tolerance approach to money laundering, terrorist financing, and sanctions violations.
1. Scope and Purpose
1.1 This Policy outlines the principles, obligations and procedures we follow to prevent financial crime as we onboard and trade with Clients in the Fluyt Pilot.
1.2 This Policy applies to all interactions involving:
- Onboarding and KYC checks
- Pilot participation
- BTC-settled environmental certificate trades
- Registry transfers and cancellations
- Post-trade documentation and reporting
1.3 This Policy sits alongside our Terms & Conditions and Privacy Policy. In the event of conflict, this Policy governs AML/KYC matters.
2. Know Your Counterparty (KYC)
Before we accept any Client into the Pilot or execute any trade, we verify the identity and legitimacy of the Client entity and its key individuals. As part of KYC, we collect and verify:
- Legal name and registration details
- Incorporation documents or registry extracts
- Registered office and principal place of business
- Directors and senior officers
- Ultimate beneficial owners (UBOs)
- Corporate structure where relevant
- Relevant registry account ownership (for certificate transfers)
If information cannot be verified or raises concerns, we do not proceed.
3. Ultimate Beneficial Ownership
We require full disclosure of individuals who:
- Own 25% or more of the Client entity
- Control decision-making, voting rights or operational direction
- Act as authorised signatories on behalf of the entity
We do not onboard Clients unwilling to disclose beneficial ownership.
4. High-Risk Structures and Red Flags
Certain structures require enhanced scrutiny, including:
- Complex holding chains or opaque jurisdictions
- Entities recently formed or with no clear commercial activity
- Large transactions inconsistent with stated business activity
- Use of intermediaries without clear justification
- Clients unable to explain certificate use or purpose
If red flags cannot be resolved, the relationship is declined or terminated.
5. Sanctions Screening
We screen Clients, directors, owners and relevant counterparties against applicable sanctions lists, including (where relevant):
- UK Sanctions List
- UN Consolidated List
- EU Sanctions Lists
- US OFAC Lists
- Other regional lists as appropriate
We do not onboard or trade with sanctioned persons or jurisdictions.
6. Bitcoin Settlement Screening
Incoming BTC payments are screened using on-chain analysis tools to identify:
- Funds linked to mixers or coin-join pools
- Transactions associated with darknet markets
- Sanctioned or high-risk wallet clusters
- Known fraud, ransomware or illicit activity sources
- Behaviour inconsistent with declared business activity
BTC flagged as suspicious may be frozen (where legally required), refunded (where permitted), or reported to relevant authorities. The Client may be offboarded immediately.
7. Client Risk Assessment
We maintain a risk assessment for each Client, considering:
- Geographic risk
- Industry and business model
- Source of funds (BTC screening)
- Certificate type and trade pattern
- Ownership and control structure
- Behaviour during onboarding
Higher-risk Clients may require enhanced due diligence or may be declined.
8. Trade Monitoring and Oversight
All trades executed during the Pilot are monitored for unusual or suspicious activity. Examples include:
- Trades significantly above typical market size for the Client
- Irregular or last-minute changes in delivery instructions
- Multiple unrelated entities attempting to pay from the same BTC cluster
- Unrealistic or unexplained certificate volumes
- Behaviour consistent with layering or obfuscation
Suspicious behaviour may result in paused trades, account review, or termination.
9. What We Do Not Do
To minimise AML and compliance risk, Fluyt does not:
- Custody Bitcoin for Clients
- Operate multi-client pooled wallets
- Accept anonymous or pseudonymous Clients
- Trade tokenised environmental instruments
- Guarantee regulatory acceptance of Client ESG claims
- Participate in schemes that artificially inflate certificate pricing
These principles ensure clean flows and protect market integrity.
10. Reporting Obligations
Where legally required, we may file:
- Suspicious Activity Reports (SARs)
- Terrorist financing reports
- Requests for information to relevant authorities
We may be prohibited by law from informing you about such reports.
11. Refusal, Suspension and Offboarding
We reserve the right to refuse onboarding, decline further trades or terminate the Client relationship at any time if:
- You fail to provide requested KYC information
- You provide false or misleading information
- We identify unacceptable AML or sanctions risk
- Incoming BTC is flagged as high-risk
- Your activity is inconsistent with legitimate environmental procurement
Where possible and lawful, we will provide reasons for refusal or offboarding.
12. Record Keeping
We maintain complete records of:
- KYC and AML documentation
- BTC transaction hashes and settlement evidence
- Trade enquiries, quotes and deal packs
- Registry transfers, cancellations and delivery evidence
- Internal risk assessments, notes and decisions
KYC records are retained for a minimum of 5 years after the relationship ends, as required by law.
13. Training and Governance
Relevant personnel receive ongoing training on:
- Anti–money laundering obligations
- Sanctions risks
- Environmental certificate market abuse risks
- Bitcoin settlement and on-chain analysis
- Data protection obligations
We review this Policy periodically and update it as required.
14. Contact
If you have questions regarding this Policy, please contact us using the details available on the Fluyt website.