Dude they're just asking you for KYC,
You already approve all Terms & Condition when you fill the forms sign up and "tick" Terms & Condition.
Have y'all read the OP's story carefully? He has submitted kyc, hitbtc now requesting reports on the sources of btc and kyc of other people involved. Wtf exchange is that?
I provided all my documents (passports), driving license, proof or address, selfi photo, and much more documents. and later they asked for source of funds and documents for person who give me the bitcoin.
Just like giving funds to inmates in prison.