Compliance

Our procedures enforce banking and IRS eligibility requirements and ongoing monitoring across all of our products.

Introduction

As a facilitator of DAF giving and grant payments at scale, it's critical for Chariot to have a compliance program that meets the highest bar in the industry. We administer our compliance program across three key verticals: Identity Verification, Gift Eligibility and Transaction Monitoring. This is managed by our internal team, alongside key external partners.

Compliance Verification

Three Levels of Advanced Diligence.

There is significant risk involved with sending grant payments to nonprofit organizations. It’s easier than ever to falsify documents, impersonate individuals and misdirect funds. That’s why on Chariot, we practice three levels of advanced diligence in our compliance verification process, to ensure the right person, with the right authority, at the right organization can receive funds safely.

Organizational Eligibility

EIN Eligibility

We conduct a compliance review on an organization’s Employer Identification Number (EIN) to determine whether they have an eligible “Nonprofit Code” and are in “Good Standing” with the IRS.

Internal Databases

We have developed a proprietary internal database for organizational eligibility, which includes six different primary data sources that are all updated on a daily or weekly basis:

• IRS Business master File

• IRS 990 Filings

• IRS Publication 78

• OFAC Sanctions

Additional Documentation

If an organization does not pass the initial screen, we request additional documentation to evaluate eligibility under common exceptions - such as religious organizations.

Gift Eligibility

Donor Advised Funds (DAFs) have important restrictions on when and where they can be used for donations. There are several layers of protection we deploy to ensure that any grant recommendations submitted via DAFpay are as compliant as possible.

1

Organization Eligibility

DAFpay can only be rendered for an EIN that meets strict DAF eligibility criteria.

2

Legal Obligations

Our contracts and Terms of Service provide legally enforceable obligations for donors to only use DAFpay for permissible grant recommendations, and for nonprofits & fundraising platforms to deploy DAFpay only in permissible fundraising scenarios.

3

Quality Assurance (QA) Checks

Prior to activation, our Partner Success Team does QA checks on DAFpay implementations with fundraising platform partners to make sure DAFpay is not used for any impermissible events.

4

Ongoing Monitoring

Our Partner Success Team also periodically reviews DAFpay implementations to enforce ongoing permissible use.

5

DAF Account Requirements

DAFpay is set up to enforce DAF-specific requirements, like minimum gift size, available balance, user permissions, etc.

6

Gift Initiation Transparency

Chariot’s DAF partners are able to see more detail on DAFpay gifts - such as the exact URL of the webpage where the gift was initiated - to enhance their due diligence.

DAFpay Limitations

It’s also important to clarify what Chariot does not handle when it comes to gift eligibility. We have no ability to circumvent any DAF provider’s internal review and approval process. Our practices described above are highly effective, but DAF providers still have the ultimate decision-making power as to whether to initiate a grant or not, based on their own eligibility requirements.

Transaction Monitoring

Chariot’s transaction monitoring procedures are designed to ensure robust oversight of financial activities relating to Chariot Deposit Accounts*. We systematically track and analyze all transactions for various key risk indicators including:

• Abnormal user behavior

• Layering activities

• Unusual movement of funds

• Large or high volume transfers

​Note: Transaction Monitoring refers to money movement in and out of Chariot Deposit Accounts. These functions are not performed on DAFpay grant requests, which are governed by our Gift Eligibility procedures described above.

Key Partners

We utilize FS Vector, the top fintech compliance firm, as compliance counsel. Our engagement has included developing our internal Compliance Program from the ground up, developing all policies and protocols, and ongoing support.

Column N.A. is a nationally chartered bank with an annualized transaction volume exceeding $1 trillion. Other program managers include companies like Brex, Mercury, Wise, and Bilt. Column was built by developers from the ground-up, making it the leading developer bank to power modern, performant experiences. Other key details on Column include:

• Column maintains a liquid balance sheet to support payments, with over 100% of the Bank’s deposit base available in cash or other immediately available sources of funding.

• Column is more than 2x the “well-capitalized” regulatory threshold.

• Column generates profits from various income streams, resulting in more stable earnings profile across various rate environments.