In 2023, NagaCorp Ltd ("NagaCorp") appointed JB Advisory Services Ltd. ("JBAS"), an independent security and risk management consultancy with working knowledge of and extensive experience in anti-money laundering ("AML") and Risk management. It was founded by a twenty-year veteran of the industry in 2020. JBAS noted the impact of the Covid 19 pandemic on the business of NagaCorp Ltd. throughout 2021. The gaming operations of NagaCorp were again suspended on March 2 2021 and recommenced on 15 September 2021.

Operations have been uninterrupted since 15 September 2021 and travel in the region has gradually recommenced throughout 2022 although China and Macau Special Administrative Region remained under stricter controls during 2022. Hong Kong Special Administrative Region gradually relaxed controls in the third and fourth quarters of 2022.

Given the ongoing restrictions, the independent review of the internal controls of NagaCorp with a focus on AML until the end of 2021 was conducted remotely but given the gradual relaxation of restrictions JBAS was able to conduct the review of the first half of 2022 and full year 2022 on site in Phnom Penh. The site visits were conducted between 22 June 2022 and 28 June 2022 and between 10 January and 13 January 2023.

As part of this site visit, JBAS participated in the on-site inspection by the Cambodia Financial Intelligence Unit ("CAFIU") which commenced on 27th June. This was the first on-site review of the operations of NagaCorp by CAFIU and JBAS briefed them on our involvement in providing twice yearly reviews of NagaCorp's AML controls details of which are enclosed in its annual report. The CAFIU inspection took place over several days. The comprehensive review took place over a few days with further clarification exchanges after the actual visit. As part of this outreach by CAFIU there were two AML training sessions conducted by CAFIU and attended by staff of Nagacorp compliance department on 19 September and 6 October 2022.

In summary, JBAS assesses that neither the pandemic nor the enforced closure of the gaming operations negatively impacted the AML controls applied by NagaCorp and since the reopening all AML controls remain firmly enforced.

JBAS conducted a thorough review of all documentation and examined records created by NagaCorp during 2022. As has been the case since 2019, our principal points of contact were Director of Compliance, Mr. Jason Ooi who joined the Company in May 2019 and Mahendran Supramaniam who has long term experience in AML controls supervision in NagaCorp. In addition, regular contact was maintained with NagaCorp staff both in Hong Kong and Phnom Penh throughout the first half of 2022 alongside external consultation on the progress of AML controls in Cambodia.

In August 2020, to further enhance NagaCorp's compliance in areas of Know Your Customer, Customer Due Diligence, Enhanced Due Diligence, Politically Exposed Persons and Transaction Monitoring, a long-term agreement was signed with LexisNexis as the preferred vendor. JBAS assesses that this further strengthens the robust due diligence applied by NagaCorp at NagaWorld.

JBAS verifies that NagaCorp continues to operate in accordance with all laws and regulations. The company purely targets customers visiting the company's two Phnom Penh properties and AML controls are stringently applied considerably beyond the industry norm in any other jurisdiction.

The review team found NagaWorld to be in compliance with all relevant FATF recommendations and noted that the upgrading of Cambodia by the 3rd FollowUp Report in 2021 of the APG Mutual Evaluation of Cambodia to be a positive development.

NagaCorp continues to apply the controls required in the AML Manual which was produced by NagaCorp in the first half of 2014 to reflect the requirements of both the Cambodian 2010 AML Prakas and the updated 2012 FATF Recommendations.

During the review process JBAS regularly reviews records on the ongoing AML training of relevant NagaCorp staff. In 2022, a total of 2,327 operations staff underwent refresher training and 733 new staff underwent New Employee Induction Training. This ongoing process is recognized by JBAS as providing substantial understanding of AML issues at all levels of NagaCorp.

NagaCorp, as of December 2022, has a total of eight CAMS (Certified Anti-Money Laundering Specialists) trained personnel including senior staff in Compliance, Finance, Internal Audit and Casino Operations.

Director of Compliance, Mr. Jason Ooi has significant relevant experience having most recently been employed in similar roles at two of the major gaming operators in Macau and now has significant experience in NagaCorp's operations in Cambodia. He and Mr. Mahendran Supramaniam, the Head of Internal Audit are our regular points of contact during our reviews and they ensure that NagaCorp is fully compliant with all AML regulations.

JBAS also conducted interviews with management as well as maintaining regular communication with Timothy McNally, the non-executive Chairman of NagaCorp and Chairman of the AML Oversight Committee.

JBAS recognizes the continued significant emphasis placed on AML controls by NagaCorp. There has been no deterioration whatsoever in the diligence applied in the adherence to all laws and regulations concerning AML in NagaCorp. Discussions with Mr. Jason Ooi and Mr. Mahendran Supramaniam focused on the comprehensive nature of record keeping and on the interaction with the Financial Investigation Unit ( "FIU" ) of the National Bank of Cambodia. The role of the NagaCorp Compliance Officer has been further defined in conversations with the FIU which has itself further defined its internal roles in 2020.

It is noted that casino operations were voluntarily closed from March 2, 2021, to September 14, 2021 in support of the fight against the coronavirus pandemic. Despite this, JBAS noted, in our last review, that the Suspicious Incident Records (SIRs) continued to record all necessary and relevant information. Since the reopening of casino operations, Cash Transaction Reports and Suspicious Transaction Reports continue to be submitted online to the FIU.

The AML Oversight Committee met four times in 2022, with the meetings taking place virtually due to the remaining impact on travel of the pandemic. The review team is satisfied NagaWorld maintains full control of the gaming operations and these operations remain compliant with all relevant FATF recommendations. As previously mentioned, JBAS maintains regular contact with Timothy McNally the Chairman of the AML Oversight Committee.

JBAS also notes that there has been some reinforcing of the 2007 AML Law through the issuing of further Prakas which clarify certain identifiers and increase the sanctions for breaches of AML law or indeed, breaching of any of the confidentiality conditions and reporting requirements.

JBAS recognizes that NagaWorld remains at the forefront of implementing AML controls in Cambodia and we also note that NagaCorp is committed to full compliance with all national and international laws and regulations on AML. Sources within the National Bank of Cambodia and external sources consulted by JBAS acknowledge that NagaWorld remains at the forefront of AML compliance efforts in Cambodia.

The review team found NagaWorld to be fully compliant with all relevant FATF recommendations and noted that the 2015 Mutual Evaluation Report on Cambodia of the APG and the 3rd Follow-Up Report in July 2021 were positive developments.

Alongside our review of internal controls, JBAS consulted with sources in the international banking and finance industries as well as recognized compliance experts to assess the situation in Cambodia as a whole and to understand whether there had been any significant developments or areas of concern in 2022. Our sources indicated that the Covid 19 pandemic had significantly slowed down both business and any extension or increase of compliance activity by the Financial Intelligence Unit within the National Bank of Cambodia. In our review of the first half of 2021, sources stated that prior to the pandemic Cambodia was recognized as continuing to strengthen its AML regime as referenced in the 2019 2nd Follow-Up Report by the Asia/Pacific Group on Money Laundering ("APG") of its Mutual Evaluation Report. The recent site visit by CAFIU is evidence of this progress.

In July 2021, the APG issued its 3rd FollowUp Report on the 2017 Mutual Evaluation of Cambodia Report. The summary statement from the APG report stated the following "Cambodia has made good progress in addressing the technical compliance deficiencies identified in its Mutual Evaluation Report (MER) in September 2017".

JBAS also notes that a 2021 US Advisory including criticism of casinos in the country is not relevant to NagaCorp's unique position. It was previously noted that the Cambodian government had acted to halt the growth in unregulated gaming in the country, particularly the expansion in Sihanoukville and online gaming operations. With regard to the country environment, JBAS reiterates that the strong actions by the Cambodian government, including the banning of online gaming from January 2020 and the passing of gaming legislation later in the year have significantly improved the situation and the international perception of the country's controls. The Commercial Gambling Management Commission of Cambodia ("CGMC") has also been pro-active in tightening up the licensing of gaming operations throughout Cambodia. In June and August 2022, the CGMC cumulatively renewed seventy licenses of casinos and game of chance companies throughout Cambodia. The firm steps taken by the administration have, in the opinion of JBAS, significantly improved the perception of and the actual compliance situation in Cambodia.

JBAS notes that, in November 2020, the new gaming law ("Law On The Management Of Commercial Gambling") was passed. The law will add strength to the compliance regime in Cambodia and is welcomed by analysts as providing legal and financial certainty around compliance and taxation.

JBAS reviewed the law for relevance to the AML controls applied by NagaCorp and to understand any related compliance issues that it might raise. Where Money laundering is specifically mentioned in Articles of the Law, JBAS assessed the compliance of NagaCorp and are satisfied that NagaCorp is compliant.

An area that was addressed by the AML law was threshold reporting levels for gaming operators. On November 10, 2020, the Cambodia Financial Intelligence Unit instructed that this level be Twelve Million Riels. On December 1, 2020, NagaCorp therefore restored the three thousand US Dollar threshold, equivalent to the Riel limit, having previously raised this to USD five thousand.

The ongoing diligence of NagaCorp in applying its AML controls and the improving external environment further enhance the overall compliance environment and JBAS assesses that NagaCorp remains at the forefront of AML compliance both within Cambodia and within the global gaming industry.