XTRM Financial Assurance


XTRM  is a financial technology company. As such, to guarantee financial good practice and to ensure customers have the required confidence and financial assurance to do business with us, we are regulated in all regions as a Money Service and Money Transmitter business. As such, all of your funds are protected in two ways:

 

1.      Federal regulation

2.      By State regulation

 

Under State regulation, we have to hold significant funds in a surety bond to protect client funds.


Regulatory Oversight


XTRM receives regulated oversight by both participating banks and Associated Foreign Exchange, Inc. (AFEX) as a licensed and regulated money transmitter, or its equivalent, by all regulatory agencies, both state and federal. 


As a license requirement, we are required to own eligible securities having an aggregate market value computed in accordance with United States generally accepted accounting principles of not less than the aggregate amount of all of its outstanding payment instruments obligations issued or sold by the Company and all outstanding money received for transmission by the Company. Eligible securities, even if commingled with other assets of the Company, are deemed to be held in trust for the benefit of the purchasers and holders of the Company’s outstanding payment instruments and stored value obligations, and all senders of outstanding money received for transmission, in the event of bankruptcy or receivership of the Company, or in the event of an action by a creditor against XTRM who is not a beneficiary of this statutory trust. This requirement is scrutinized with regularity through examinations, audits, and periodic reporting obligations. 


As such, we maintain at all times permissible investments that have an aggregate market value computed in accordance with generally accepted accounting principles of not less than the aggregate amount of all its outstanding payment instruments and other transfers. 


Furthermore, as a license requirement or licensing application process, we currently maintain surety bonds in all jurisdictions where licensed, for the benefit of its clients. The proceeds from these bonds are to be used only in the event of insolvency or bankruptcy by XTRM.


AFEX General Overview


AFEX provides MSB licensing and surety bonding for XTRM and XTRM partners and customers.  AFEX was founded in 1979 and has become  one of today’s largest privately owned providers of global currency exchange and risk management solutions. They have over  35,000 businesses and individuals worldwide, processing currency exchange and money movement of over 180 countries around the clock every day. AFEX fully adheres to international payments and regulatory requirements. Regulatory obligations require AFEX to safeguard all client funds  and segregate certain funds, providing clients with the confidence they are transacting securely. Sophisticated data encryption is used to ensure privacy and data security



FinCen MSB Registration Number:         31000117020834

Associated Foreign Exchange, Inc.         DBA:  AFEX

21045 Califa Street 

Woodland Hills, CA 91367  

United States


AFEX Security Of Funds Overview


Associated Foreign Exchange, Inc. and its subsidiary and affiliated entities (collectively “AFEX”) are regulated in over fifty global jurisdictions. The legislation and regulation governing its payment activity varies from jurisdiction-to-jurisdiction. However, one of the commonalities among all jurisdictions is the legislative intent to ensure the pecuniary safety of customers. This is accomplished through two general tranches of legislative protections.


The first tranche involves protection afforded to mitigate the occurrence of an insolvency event. Many jurisdictions stipulate that AFEX maintain certain capital requirements. These provisions help to ensure that AFEX operates under sound financial health. Another legislative tool to help mitigate the occurrence of an insolvency event is the requirement to safeguard funds. Numerous jurisdictions require AFEX to maintain certain eligible assets to cover the funds it receives from its customers for payment activity. The aforesaid requirements are scrutinized with regularity through examinations, audits, and periodic reporting obligations.


The second tranche involves the protection afforded in the occurrence of an insolvency event. In the event of insolvency, many of AFEX’s regulatory authorities have certain legislative tools to help ensure the customer is made financially whole. Many jurisdictions stipulate that customers receive a senior debt preference. That is, obligations owed to customers are paid prior to obligations owed to non-customer creditors (i.e., junior debt holders). Additionally, 


AFEX is required to maintain surety bond coverage in certain jurisdictions within the United States. These United States customers are entitled to a claim on the surety bond for damages incurred by AFEX’s failure to perform a contractual obligation. Finally, many regulatory authorities have 


the ability to place AFEX in receivership. In this event, a receiver is appointed to run the company and manage the distribution of assets. The receiver would adhere to the above stated debt preference hierarchy.