Company: FLDDW
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001013762-25-004107
Chunk: 16

Company: Fold Holdings, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1
Chunk 16
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Secrecy Act or other regulations related to anti-money laundering, our relationships with Sutton Bank and the Bitcoin Service Providers,
together with our obligations under applicable sanctions laws, require us to comply with AML requirements. This is because both Sutton
Bank and the Bitcoin Service Providers are considered “financial institutions” subject to the Bank Secrecy Act. Because we
act as an intermediary between our customers and Sutton Bank and the Bitcoin Service Providers, we must take certain actions to facilitate
their compliance, as described below.

Fold is required to stay updated with constantly
changing AML regulations, including those set by the intergovernmental organization the Financial Action Task Force, local laws, and our
partners. As a mobile application, we face significant challenges, such as remote onboarding of our customers, which makes it difficult
to verify the identity of customers submitting applications for the Fold products thoroughly. In addition, the high volume of transactions
both in our debit card and bitcoin buying and selling makes it difficult to monitor transactions for AML purposes. To mitigate these risks,
Fold has implemented a risk-based approach Anti-Money Laundering program to measure customer identification practices, monitoring (real-time
monitoring) and escalate questionable activities, and maintain records to prevent illicit financial activities in our platforms.

As for counter-terrorism financing, Fold ensures
that it adheres to all OFAC regulations and ensures that no transactions are involved with a sanctioned country to the best of our ability.
Fold is dedicated to maintaining a high standard of compliance with international regulations, and our proactive approach to sanctions
screening is an integral part of our commitment to prevent any engagement with sanctioned individuals or entities. We prioritize the safety
and compliance of our platform to ensure a secure environment for all users. As part of our commitment to regulatory compliance, we proactively
conduct screening against the Office of Foreign Assets Control (OFAC) and sanctions lists for all users during the onboarding process.
This screening is performed using the data points provided by users during the registration phase.

Our automated screening process aims to identify
potential matches with individuals or entities listed on sanctions lists; information such as IP address and true location is used at
this phase to ensure compliance with all OFAC regulations. In addition to the initial screening conducted during onboarding, Fold is committed
to maintaining a vigilant and ongoing compliance posture. We perform continuous OFAC and sanctions screenings on all users with a daily
frequency. This proactive approach ensures that our platform remains current and aligned with the latest updates to the sanctions lists.