Company: FRHC
Filing Date: 2025-06-13
Form Type: 10-K
Source: 0000924805-25-000012
Chunk: 62

Company: Freedom Holding Corp.
Filing Date: 2025-06-13
Form: 10-K
Item: Item 1
Chunk 62
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 above verification service provider, and this platform is currently implemented at our operations in Kazakhstan. We plan to roll out the platform so that it is used by all brokerage companies, banks and other companies within our group of companies. Subject to local legislation, some of the features may be limited, but in such cases, such features would be replaced by relevant government services. For example, banks in Kazakhstan use the national government system for biometric identification. 

At our subsidiaries Freedom KZ and Freedom Global, the KYC/AML compliance suite is integrated with a globally recognized database of sanctioned and high-risk individuals and entities. At our subsidiary Freedom Bank KZ, this database is integrated with the banking system Colvir. The database is used during the onboarding and ongoing processes, by checking customers. It contains information on individuals and legal entities from more than 715 lists submitted by international and national security agencies and law enforcement agencies. It also allows identification of hidden risks associated with individuals or companies that have been included in sanctions lists, involved in money laundering (AML) or the financing of terrorist activities, including the proliferation of weapons of mass destruction (CFT and/or WMD) or associated with Politically Exposed Persons (PEP). Our subsidiaries Freedom KZ, Freedom Global and Freedom Bank KZ also use the Dow Jones database during the onboarding and ongoing customer due diligence processes by checking customers against sanctions lists, PEP lists or other negative information. 

In addition, we maintain omnibus brokerage accounts for certain other institutional brokerage customers. The order flow from these accounts represents transactions of underlying customers of the relevant institutions, which are executed by the relevant institutions through their omnibus accounts with us. We have representations from such institutional customers by which they have agreed to comply with AML/CTF controls that are applicable to brokers, and we also audit their frameworks and systems by regular risk-based sampling and have access to their underlying customer records for purposes of compliance monitoring. Nevertheless, we do not have direct access to such institutional customers' underlying customers or screening systems.

See "Our measures to prevent money laundering, terrorist financing, and sanctions violations may not be completely effective." and "Non-compliance with U.S., EU, UK or other sanctions programs could adversely impact our company." in "Risk Factors" in Part I Item 1A of this annual report.

Protection of Customer Assets 

Our business is subject to extensive oversight by regulators around the world relating to, among other things, the fair treatment of customers, safeguarding of customer assets and our management of customer funds.