Member Disciplinary Action

1.Background

The G&J KYC Information Centre (“Company”) will be the primary point for members of the gems and jewellery industry who have registered or intend to register on the website of the Company (“Members”) available at www.mykycbank.org (“Website”), for completing and sharing their Know Your Customer (“KYC”) information on the Website. This also puts the responsibility on the platform compliance team to do the necessary due diligence on the KYC information submitted by the members.

It is also likely that Members may contravene the terms and conditions applicable to all the users of the Website, either inadvertently, or by design. While no policy can cover all possible alternatives, this policy document lays down material contraventions as well as actions which the Company may initiate, to mitigate risks to the Company as a result of contravention of the terms of the Website by the Members.

2. Disciplinary Committee

2.1 The primary responsibility for investigating and/or initiating disciplinary proceedings against contravening Members will be with the a disciplinary committee (“Disciplinary Committee”) proposed to be established by the advisory council of the Company (“Advisory Council”), under such terms and conditions of establishment and governance as may be prescribed by the Advisory Council.

2.2 The Disciplinary Committee may consist of either: (a) members of the Advisory Council; (b) external experts appointed by the Advisory Council; and/or (c) both. The Disciplinary Committee shall be solely responsible for determining the disciplinary actions to be undertaken against a Member, in relation to any contraventions of the Members on the Website. The Members agree to be bound by the decision of the Disciplinary Committee on all matters.

3. Trigger Events

3.1 There are 2 (two) kinds of trigger events which may cause disciplinary action to be taken on a Member, namely: (a) process related triggers; and (b) compliance related triggers.

3.2 Process related triggers: Process related triggers are those which are mainly either system driven, where the Member has generally not completed an activity applicable to such Member on the Website, which they should have done in the normal course. These are generally more operational in nature and in most cases, may not warrant any serious deliberation or action by the Disciplinary Committee.

An indicative list of the key process related trigger events are listed below

3.2.1 Non-payment of membership fee of: (a) the Company; and/or (b) the applicable industry trade body with which a Member is associated (“Industry Trade Body”), within the time period prescribed by the Company and/or the Industry Trade Body;

3.2.2 Failure to submit certified hard-copies of KYC documents by a Member through the relevant Industry Trade Body within a prescribed duration of 30 (thirty) days after the confirmation of the first level of verification by the Company and/or individual activation of the Member’s profile on the Website;

3.2.3 Inability to complete and/or furnish new requirements and/or documents, including but not limited to valid documentation of expired documents within the time provided by the Company (E.g. expired passport copy not updated and/or new declaration required with an accountant’s validation etc.);

3.2.4 In the event of Members whose profiles have been suspended on the Website and where no corrective action has been taken by such Members (other than those under review by the Disciplinary Committee) for a period of 60 (sixty) days from date of such suspension;

3.2.5 Using the Website for marketing purpose and/or sharing of any details which involve marketing activity for a commercial gain and/or benefit of the Members business through their registered accounts on the Website; and/or

3.2.6 Any other event as the Disciplinary Committee may think fit, in its sole discretion.

3.3 Compliance related triggers: Compliance related triggers are generally more serious in nature and usually will require attention by the compliance team of the Company. These triggers may arise from sources such as reporting of errors by connections and/or compliance team checks on global databases; and/or sanctions and/or enforcement introduced by global or industry bodies on the Members. An indicative list of the key compliance related trigger events are listed below:

3.3.1 Initiation of voluntary winding-up or bankruptcy proceedings against a Member;

3.3.2 The Industry Trade Body’s or government decision to: (a) suspend or prohibit the Member and/or any promoter, officer, director, key managerial employee and/or ultimate beneficial owner of the Member and/or its group entities; and/or (b) cancel their respective membership from the concerned Industry Trade Bodies; or any Member’s decision to cancel and/or non-renewal of their respective membership from the Website;

3.3.3 Member and/or any promoter and/or officer of the Member and/or its group entities being included to any of the global sanctions or enforcement lists;

3.3.4 Any misrepresentation by a Member on the Website, including without limitation in relation to declarations and/or supporting documents, such as the following:

1. Non-reporting and/or mis-reporting of any information, including without limitation in relation to the legal identifiers (e.g. GST etc.), bank account number, trade body membership etc. or any changes thereof, in a timely manner;

Non-reporting of information relating to the ownership, management and/or representative of the Company.

1. Non-reporting of any significant change in the ultimate beneficial ownership within a period of 30 (thirty) days from the date of occurrence of such change.

3.3.5 Material violations of the code of ethics or any other policies of the Company and/or proven misdemeanor by the Member in any of their dealings in any manner, as determined by the Disciplinary Committee, which has not been rectified within a period of 15 (fifteen) days from the date of notice of such violation by the Company;

3.3.6 Conviction of a Member or its group entities, and/or any of their respective promoters, directors, officers, key managerial personnel and/or their ultimate beneficial owners for any criminal offences, by a Court of law in any jurisdiction;

3.3.7 A process related trigger that has resulted in or is likely to result in a compliance trigger because the Member is unwilling to comply with the directions issued by the Disciplinary Committee; and/or

3.3.8 Any other event as the Disciplinary Committee may deem fit, in its sole discretion.

4. Disciplinary Action Process

4.1 The Disciplinary Committee may initiate a disciplinary action, as may be determined by it in its sole discretion.

4.1.1 Process related triggers: In the event of a process related trigger, the Website will automatically suspend the Members’ account, upon the detection of non-compliance by the Member. Such Member will not be permitted to undertake any actions and/processes which on the Website, including any action associated with their network connections with other Members on the Website. However, once the account is suspended, the Member will be notified of the contravention and will be given the opportunity to rectify such non-compliance within a stipulated period of time. Once the notified non-compliance is rectified by the Member to the satisfaction of the Disciplinary Committee such Member’s profile will be re-activated, and such Member may access and use the services available to it on the Website. Note, that in the event such contraventions are not rectified within the stipulated period of time, the profile of the defaulting Member will be disabled and deleted in accordance with Clause 6 and Clause 7.

4.1.2 Compliance related trigger:

1. In the event of detection of a compliance related trigger by the Company’s compliance team and/or upon receipt of a complaint by another Member and/or by an Industry Trade Body and/or the Government, the trigger shall be documented and reported to the Disciplinary Committee within 15 (fifteen) days of such detection and/or receipt of a complaint.
2. The Disciplinary Committee will review the contravention with the assistance of the compliance team of the Company and shall inform the defaulting Member of such contravention, in writing.
3. The defaulting Member shall, within 15 (fifteen) days of receiving a notice of contravention, rectify the contraventions, to the satisfaction of the Disciplinary Committee. In the event a contravention is caused due to a system failure of the Website, the Member shall inform the Company accordingly, and the Company shall ensure the rectification of such system error. All the contraventions of the Members and the decisions relating thereof, shall be recorded on the profile of the Members on the Website, if it is deemed relevant by the Disciplinary Committee. The compliance team shall be responsible for ensuring that the Member rectifies all its’ contraventions within the stipulated time.
4. Notwithstanding the aforesaid provisions provided in items (a), (b) and (c) above, in the event the Disciplinary Committee determines that a contravention by a Member is material, it may either independently (with assistance of compliance team) or with the assistance of the concerned Industry Trade Body with which the Member is registered, investigate the contravention, to determine the actions of the Members. The concerned Member may also be contacted by the Advisory Council for information relating to the contravention.
5. Based on the decision of the Disciplinary Committee, the Member may at the sole discretion of the Disciplinary Committee, be given an opportunity to rectify the contraventions within a stipulated period of time, or the profile will be permanently disabled. An official communication to such effect shall be communicated to the concerned Member.
6. In the event of a disablement of the profile of a Member, the Member will have a 1 (one) month period to seek a review of such decision by the Disciplinary Committee. In the event the Disciplinary Committee (a) rejects an appeal for a review; or (b) does not set aside its earlier decision, the Member shall have a right to appeal such decision of the Disciplinary Committee to the Advisory Council. The decision of the Advisory Council shall be final in this regard.
7. The Disciplinary Committee will periodically inform the Advisory Council of any matters which were brought to its notice and the actions taken on the same.

5. Suspension of a Members profile

Suspension of a Member’s profile is a temporary process resulting from less serious contraventions. The Member shall be provided with ample opportunity for presentation and/or correction of the contraventions and based on their corrective action, their profile on the Website may be re-activated, at the discretion of the Disciplinary Committee. A defaulting Member may access their profile and submit change requests to rectify the contraventions, but the remaining functions on the profile shall be suspended. Note, that all process related triggers will be lead to an automatic suspension of the Members’ profile on the Website. For all compliance related triggers, the profiles of the defaulting Members shall be suspended during the course of the investigation on such Member.

5.1 Authorization

5.1.1 Process related triggers

A suspension of the defaulting Members profile on the Website due to a process related triggers, will be initiated automatically till the time the defaulting Members remedies the contravention, to the satisfaction of the Disciplinary Committee.

5.1.2 Compliance related trigger

In cases involving compliance related triggers for suspension of a Members profile on the Website, the Disciplinary Committee may suspend a Member’s profile after providing adequate intimation to the concerned Member, in accordance with this policy.

5.1.3 Resultant Outcomes

1. In case of suspension of the Member’s profile of the Website, an email intimation shall be provided to the suspended Member regarding the suspension of its membership from the Website, describing in detail the reason and prescribing the remedial actions that may be taken by the defaulting Member.
2. During the suspension period, the Members will be able to login to their profiles on the Website and view their own profile, and/or initiate change request only. All other facilities on the profile such as access to send and/or receive requests to and from the network connections from other Members shall remain suspended. All the other Members who are already connected with the suspended Member will be able to view the suspended Member’s summary profile but with a highlighted alert informing them about the suspension and effective date and reason for suspension.
3. All other Members (who are not connected with the suspended Member on the Website) may search for the Member’s profile but will not be permitted to initiate a connection request. A suitable message about the temporary suspension of the Members profile shall be displayed on the suspended Members profile. Such message will not include details of the suspension.
4. A notification and/or wall-post on the appropriate wall page of all the network connections of the suspended Member will be displayed, notifying the suspension of the concerned Member.

5.1.4 Appeal / Reversal

1. Any system generated suspension of a Members profile due to a process related trigger will be reversed by the Website automatically, upon corrective action taken by the defaulting Member in relation to the correction of the process related trigger.
2. In cases of suspension based on a compliance related trigger, the compliance officer at the Company is authorized to reverse the suspension of the defaulting Member’s profile, after discussions with and a written consent from the Disciplinary Committee.
3. Once reversed, the defaulting Member’s full rights and privileges to use the Website and the facilities and/or features available on such Members profile will be restored and the Member will be intimated by email about such restoration.
4. Note, that a Member will be required to ensure continued and uninterrupted payment of the relevant annual charges for membership during the period of suspension, in order for the profile to be activated, post an order of re-activation of the Member’s profile on the Website.

6. Disablement of a Member’s account

Disablement of a Member’s profile from the Website is a permanent process resulting from material process related triggers and compliance related triggers. Disablement of a profile effectively renders it unusable, thereby resulting in serious consequences for the Member’s reputation and their future participation in trade.

6.1 Authorization

6.1.1 Process Triggers

Disablement due to a process related trigger will be implemented automatically, after reasonable intimations provided to the Member.

6.1.2 Compliance Trigger

In cases involving compliance related triggers, the Disciplinary Committee will have the discretion and/or authorization to disable a Member’s profile after due review of the contravention.

6.1.3 Resultant Outcomes

1. An email intimation shall be provided to a defaulting Member about the disablement of its membership from the Website, describing, the reason(s) for the disablement of its membership.
2. Multiple email alerts (at least 2 (two) at periodic intervals of 15 (fifteen) days from the date of disablement) shall be communicated to all the network connections of such defaulting Member about the disablement of such Members’ membership on the Website, describing the reason(s) for such disablement in detail. A similar notification on the wall pages of all the network connections of the defaulting Member will be displayed.
3. Once a decision to disable a Member’s account has been determined, the Member will be alerted about such disablement of its profile upon the completion of the log-in process by such Member, which will be followed by the automatic logging-out of the Member from the Website.
4. All the other Members who are already connected with the defaulting Member will be able to view such Member’s summary profile but with a highlighted alert informing them about the disablement and effective date and reason for such disablement of the concerned Member.
5. All other Members (who are not connected with the defaulting Member on the Website) may search for the Member’s profile but will not be permitted to initiate a connection request. A suitable message about the disablement of the Members profile shall be displayed on the suspended Members profile.

6.1.4 Appeal / Reversal

1. Only under extremely rare circumstances, a disabled profile of a Member may be reversed and/or restored by a proposed request from Disciplinary Committee and/or the Advisory Council.
2. For a period of 6 (six) months following the date of reversal of disablement of a Members profile, the concerned Member’s profile will bear a suitable alert red mark on its profile and such other instances of display across the Website, for the information of the other Members.
3. Such defaulting Member’s page on its history will also record this instance of disablement and such recording of the disablement will also be displayed in the comments section of profile of the Member on the Website.