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Fictional case for portfolio training only. No real person, company, or jurisdiction. Not a real STR. Not legal advice. Not investment advice.

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Snapshot

Facts (fictional)

• Applicant: Rina Okada (fictional), Japanese national applying as a non-resident retail client for a simulated SFC-licensed VATP account.
• Stated profile: “Independent digital-asset trader”; expected first-year funding HKD 4.5 million; claimed SOF = “trading profits and consulting fees” from a personal consulting brand Aurora Signal Desk (fictional).
• Nexus flags (scenario design):
  • Declared residential / banking footprint partly linked to Jurisdiction Z — a fictional jurisdiction treated as higher risk under the firm’s country-risk methodology (aligned to Guideline ¶ 4.13 factors). No real country is named.
  • Adverse-media hit (simulated commercial database): two recent articles alleging that Aurora Signal Desk promoted unlicensed investment schemes to retail clients (allegation only; no court finding in the scenario).
• Documents initially provided: Passport; proof of address in Jurisdiction Z; selfie; self-declared SOF questionnaire with round-number income and no bank trail.
• EDD requests issued: (1) 6 months of bank statements showing accumulation of the HKD 4.5m; (2) tax filings or invoices supporting “consulting fees”; (3) explanation of adverse-media allegations; (4) evidence funds would not be third-party / pooled investor money.
• Applicant response: One-page letter asserting “privacy” and that SOF is “trading skill”; refused bank statements and tax documents; declined to address adverse media beyond “fake news”; threatened to “take business elsewhere” if pressed.

Regulatory requirement (primary)

High-risk situations (Guideline ¶ 4.9 / AMLO Sch. 2 s.15 as restated): where the situation may present high ML/TF risk, the FI must obtain senior-management approval to establish the relationship and either take reasonable measures to establish SOW and SOF or take additional mitigating measures.

SOF (¶ 4.11.14): origin of the particular funds — the activity that generates the funds; information should be substantive.

¶ 4.13: extra care for relationships connected with jurisdictions assessed as higher risk.

¶ 4.17.1 (AMLO Sch. 2 s.3(4) as restated): where the FI is unable to complete CDD, it must not establish a business relationship, and should assess whether the failure gives grounds for suspicion / STR.

Appendix B indicators include: SOF unclear or inconsistent with profile; customer who refuses information without reasonable explanation.

FATF INR R.15: VASPs are expected to apply R.10 CDD preventive measures.

待核实 note: Direct statutory text of AMLO Cap. 615 Sch. 2 on elegislation.gov.hk was not scraped (JS gate). Sch. 2 citations follow the SFC Guideline’s restatement.

Control applied

1. Risk rating raised to High (adverse media + high proposed funding vs thin evidence + higher-risk jurisdiction nexus + remote non-resident channel).