Services
Customer Registration & KYC norms are strictly followed.
New clients shall be registered only after following proper due diligence process preferably after obtaining the introduction
Proper documents are obtained in respect of proof of identity & address.
No Trading account will be opened unless the copy of the PAN Card as verified with original has been submitted & cross-tallied with Income Tax Site.
The clients details shall be regularly updated & monitored in particular HNI, s & Corporate clients
The client shall be properly mapped under a particular Terminal then only the trade for the client will be done.
The client shall be allowed exposure limit as per its capital or balance/ deposit in his account and as per the policy of the company.
At the end of the day trading the client shall be asked to deposit his margin/ payin amount.
9)
If the client does not pay margin/ payin obligation he should be warned & his trading limit shall be set as nil. If required the open position of the client should be closed out looking to the market condition & client background under intimation to the director wherever necessary.
At the close of the market all the trades done by clients confirmed to him.
11)
All the clients are intimated during/ at the close of the trading time regarding the trades done by him. If the client refuses to accept the trade the sauda shall be reverted at the current market price if possible or the client code shall be suitably modified for the correct client or taken to pro a/c within the time allowed by the relevant exchange. However if the time for correction of trade has expired & the same shall be updated in pro a/c in the back office. However any trade shall be modified only after checking the cause of the same & proper record shall be maintained.
Contract Notes / Bills shall be issued in the evening on the trade day itself.
Payin/payout shall be made with the clients only.
Cheques shall be accepted from the clients of the Bank designated by the client.
Cheques shall be issued to the clients against his designated bank account only.
16)
Statements of funds & securities shall be directly sent to the client as per the relevant exchange regulations & confirmation shall be obtained.
Billing is automatically done through the Back office software after reconciling the data with NSE system.
18)
The complaint received from client shall be given highest priority. If the complaint is not resolved within reasonable time the same shall be intimated to and reviewed by a senior officer / director.
19)
The clients defaulting in making the payments shall be referred to the separate department, which will take the necessary actions as per the circumstance of the case.
Separate filing department is maintaining all the records of the client facilitating fast retrieval of data.
1 Background:
The Prevention of Money Laundering Act, 2002 (PMLA) has been brought into force with effect from 1st July 2005 and summarizes the main provisions of the applicable anti-money laundering and anti-terrorist financing legislation in India and provides guidance on the practical implications of the Act. Director Financial Intelligence Unit-INDIA (FIU-IND) has been conferred with exclusive and concurrent powers under relevant sections to implement the provisions of the act. The PMLA 2002 imposes an obligation on banking companies; the financial institutions and intermediaries associated with the security market and are registered with SEBI under section 12 of SEBI act – 1992 to maintain the records of certain transactions of the nature and value and furnish such information to the Director and verify and maintain the records of identity of clients as specified in the act.
The Unlawful Activities (Prevention) Act, 1967 (UAPA) as amended by the Unlawful Activities (Prevention) Amendment Act, 2008 has been enacted for the prevention of certain unlawful activities of individuals and associations and for matter connected therewith. It requires the stock exchanges, depositories and registered intermediaries to report the particulars of clients and their funds, financial assets or economic resources or related services held in the form of securities with them, if the clients details matches with the particulars of individuals/ entities subject to UN Sanction measures or any other person engaged in or suspected to be engaged in terrorism as directed by Central Government. In terms of section 51A of the UAPA, the central Government is empowered to freeze, seize or attach funds and other financial assets or economic resources held by, on behalf of or at the direction of such suspected entities and prohibit any individual or entity from making any funds, financial assets or economic resources or related services available for the benefit of such suspected entities.
The application of anti-money laundering measures by Market Intermediaries has been emphasized by international regulatory agencies as a key element in combating money laundering. Establishment of anti money laundering programs by Market Intermediaries is one of the central recommendations of the Financial Action Task Force.
Exclusive Securities Ltd. is a Member of National Stock Exchange of India ltd. and is having trading cum clearing membership of Capital Market and Futures and Options Segment of NSEIL. Accordingly it is liable to implement Anti Money Laundering Policy to discourage and identify any money laundering or terrorist financing activity.
2 What is Money Laundering?
Money laundering involves disguising financial assets so that they can be used without detection of the illegal activity that produced them. Through money laundering, the launderer transforms the monetary proceeds derived from criminal activity into funds with an apparently legal source. These illegal activities include drug trafficking, terrorism and other organized and serious crimes.
There are three common stages of money laundering as detailed below which are resorted to by the launderers and Market Intermediaries which may unwittingly get exposed to a potential criminal activity while undertaking normal business transactions: -
Placement - the physical disposal of cash proceeds derived from illegal activity;
Layering - separating illicit proceeds from their source by creating complex layers of financial transactions designed to disguise the source of money, subvert the audit trail and provide anonymity
Integration – placing the laundered proceeds back into the economy creating the impression of apparent legitimacy to criminally derived wealth.
Using the alternative methods the laundered proceeds re-enter the financial system appearing to be normal business funds. Market Intermediaries are therefore placed with a statutory duty to make a disclosure to the authorized officer when knowing or suspecting that any property, in whole or in part, directly or indirectly, representing the proceeds of drug trafficking or of a predicated offence, or was or is intended to be used in that connection is passing through the Market Intermediaries. Law protects such disclosures, enabling the person with information to be able to disclose the same without any fear. Market Intermediaries likewise need not fear of breaching their duty of confidentiality owed to customers.
3 Anti Money Laundering Program:
In order to discharge the statutory responsibility to detect possible attempts of money laundering, financing of terrorism or any other proceeds of crime, Market Intermediaries need to have an AML program that should, at a minimum, include:
- Principal Officer
- Internal policies, procedures, and controls;
- Customer Due Diligence Process
- Recruitment of staff;
- Training of Staff on PMLA awareness;
- Identifying and Reporting Suspicious Transactions
- Record Keeping and Retention of Records
- Review of the policy
This document details the AML Program adopted by Exclusive Securities Ltd (ESL).
3.1 Principal Officer:
Appointment:
ESL will appoint management personnel to act as Principal Officer under the provisions of PMLA. Names, designation and addresses (including e-mail addresses) of ‘Principal Officer’ including any changes therein shall be intimated to the Office of the Director-FIU
Responsibilities:
The Principal Officer will ensure that:
The AML program is communicated and implemented effectively.
Customer Due Diligence Process is followed.
Proper records are maintained.
The analysis of the data and reporting transactions of suspicious nature to FIU-IND directly.
ESL staff are trained to address issues regarding the application of the PMLA
The Staff selection and training process complies with the PMLA policy
Regular updation regarding any changes/ additions/ modifications in PMLA provisions.
3.2 Internal policies, procedures and controls:
Know Your Client (KYC):
Considering the potential threat of usage of the financial services by a money launderer, it is essential to make reasonable efforts to determine the true identity of CLIENTS requesting for services offered by ESL. As per the rules every Intermediary shall-
At the time of commencement of an account based relationship, identify its clients, verify their identity and obtain information on the purpose and intended nature of business relationship, and In all other cases, verify identity while carrying out:
Transactions of an amount equal to exceeding rupees fifty thousand, whether conducted as a single transaction or several transactions that appear to be connected or Any international money transfer operations.
Annexure ‘I’ details the Customer Due D iligence (CDD) procedure that includes the following:
Policy for acceptance of clients
Procedure for identifying the clients
list of documents to be obtained at the time of Account Opening for compliance with KYC requirement.
Routine Monitoring
The routine transactions of the clients shall be continuously monitored:
Transactions volume inconsistent with the client’s financial background.
All complex, unusually large transactions / patterns which appear to have no economic purpose.
Transactions exceeding the threshold limits fixed for each class of client account
Sudden major activity in dormant account
v
To run a check on the given parameters to verify whether individuals or entities subject to UN sanction measures as forwarded by SEBI are holding any assets
Updation of KYC details of clients
A detailed appreciation of the requirements under PMLA in the form of ‘Frequently Asked Questions’ (FAQs) are given in Annexure ‘II’.
3.3 Recruitment of ESL employees:
ESL would ensure adequate screening procedures when hiring employees. Persons with known References will be given preference. Cross verification of details given by employee will be done as per the requirement. It would also ensure that the employees dealing with PMLA requirements are suitable and competent to perform their duties.
3.4 Training of ESL employees
ESL will conduct PMLA awareness program for its existing employees to ensure that they are aware of their obligations under the provisions of PMLA. ESL will also impart periodical refresher training to the staff to keep them updated on new developments and to communicate any changes in the policies, procedures etc. ESL will ensure that the new staff recruited by ESL is given initial PMLA awareness training.
3.5 Identifying & reporting Suspicious Transactions:
The function of ESL is to extend various services to clients as per their specific instructions. The details regarding the origin, form, destination of funds, financial profile of the investor etc. are available with the ESL. List of the transactions to be monitored, the parameter applicable for these transactions, are given in Annexure ‘III’.
In terms of the PMLA rules, intermediaries are required to report information relating to cash and suspicious transactions to the Director, Financial Intelligence Unit-India (FIU-IND) at the following address:
Director, FIU-IND, Financial Intelligence Unit-India, 6th Floor, Hotel Samrat, Chanakyapuri, New Delhi-110021. Website: http://fiuindia.gov.in/ Formats of the reports and there frequency are given in Annexure ‘IV’.
Intermediaries should not put any restrictions on operations in the accounts where an STR has been made. Intermediaries and their directors, officers and employees (permanent and temporary) should be prohibited from disclosing (“tipping off”) the fact that a STR or related information is being reported or provided to the FIU-IND. Thus, it should be ensured that there is no tipping off to the client at any level. However, ESL should consult the relevant authorities in determining what action it should take when it suspects suspicious trading.
3.6 Identifying & reporting assets held by persons specified by SEBI:
In terms of order issued under the Unlawful Activities (Prevention) Act, 1967 by Central Government, the intermediaries are required to maintain in electronic format, updated list of individuals/ entities subject to UN Sanction measure as received from the Ministry of External Affairs through SEBI (referred to as designated individuals/ entities) and run a check on the given parameters on a regular basis to verify whether such individuals or entities are holding any fund, financial assets or economic resources or related services held in the form of securities with them.
In the event, particulars of any customer/s match the particulars of designated individuals/entities, ESL shall immediately, not later than 24 hours from the time of finding out such customer, inform full particulars of the funds, financial assets or economic resources or related services held in the form of securities, held by such customers in the ESL books to following persons:
a.
Joint Secretary (IS.I), Ministry of Home Affairs at Fax No. 011 – 23092569 and over telephone on 011 - 23092736 and also on email at jsis@nic.in . Particulars shall also be sent by post.
b.
UAPA officer of SEBI, Officer on special duty, integrated surveillance department, Securities and Exchange Board of India, SEBI Bhavan, Plot no.C4-A, “G” Block, Bandra Kurla Complex, Bandra (E), Mumbai – 400 051 through post/fax and email at sebi_uapa@sebi.gov.in
c.
UAPA nodel officer of the state/UT where the account is held.
FIU-IND.
In case the aforementioned details of any of the customer/s match the particulars of designated individuals/entities beyond doubt, ESL shall prevent designated persons from conducting financial transactions, under intimation to Joint Secretary (IS.I), Ministry of Home Affairs at Fax No. 011 – 23092569 and over telephone on 011 - 23092736 and also on email at jsis@nic.in . Particulars shall also be sent by post.
ESL shall also file a Suspicious Transaction Report (STR) with FIU-IND covering all transactions in the accounts covered as above carried through or attempted, as per the prescribed format.
ESL shall also follow the orders for freezing or unfreezing, if any, relating to funds, financial assets or economic resources or related services as communicated by SEBI.
3.7 Record Keeping and Retention of Records
3.7.1
In terms of section 12 of the Prevention of Money Laundering Act, 2002, every banking company, financial institution and intermediary shall maintain a record of all transactions, the nature and value of which may be prescribed, whether such transactions comprise of a single transaction or a series of transactions integrally connected to each other, and where such series of transactions take place within a month.
3.7.2
Intermediaries are required to maintain and preserve the following information in respect of transactions referred to in Rule 3 of PMLA Rules:
the nature of the transactions;
the amount of the transaction and the currency in which it denominated;
the date on which the transaction was conducted; and
the parties to the transaction.
3.7.3
Should there be any suspected drug related or other laundered money or terrorist property, the competent investigating authorities would need to trace through the audit trail for reconstructing a financial profile of the suspect account. To enable this reconstruction, ESL should retain the following information for the accounts of their customers in order to maintain a satisfactory audit trail:
the beneficial owner of the account;
the volume of the funds flowing through the account; and
for selected transactions:
the origin of the funds;
the form in which the funds were offered or withdrawn, e.g. cash, cheques, etc.;
the identity of the person undertaking the transaction;
the destination of the funds;
the form of instruction and authority.
3.7.4
The intermediary is required to verify and maintain the records of the identity of all its clients, in the prescribed manner. Records of customers identification (e.g. copies of official identification documents like passport, identity cards, driving licenses or similar documents), accounts files and business correspondence should be kept.
3.7.5
The records are required to be maintained for a period of ten years from the date of the transactions between the clients and ESL.
3.7.6
In situations where the records relate to on-going investigations or transactions which have been the subject of a suspicious transaction reporting, they should be retained until it is confirmed that the case has been closed.
In view of this, ESL shall maintain the records like account opening and their supporting documents etc., in terms of the provisions of PMLA for a period of 10 years as required by PMLA. The retention period shall be modified on receiving appropriate instructions from any regulatory authority like SEBI, or any other statutory authority. Further the background including all documents/ office records/ memorandums/ clarifications sought pertaining to transactions crossing the threshold limits fixed for each class of client accounts and findings thereof shall be recorded and maintained.
3.8 Review of Policy:
ESL shall review the aforesaid policy at regular intervals. Principal Officer shall be the authority to give directions for review of policy and undertake additions, changes, modifications etc. as directed by SEBI.
The customer due diligence (“CDD”) measures comprise the following:
Obtaining sufficient information in order to identify persons who beneficially own or control securities account. Whenever it is apparent that the securities acquired or maintained through an account are beneficially owned by a party other than the client, that party should be identified using client identification and verification procedures. The beneficial owner is the natural person or persons who ultimately own, control or influence a client and/or persons on whose behalf a transaction is being conducted. It also incorporates those persons who exercise ultimate effective control over a legal person or arrangement.
Verify the customer’s identity using reliable, independent source documents, data or information;
Conduct ongoing due diligence and scrutiny, i.e. perform ongoing scrutiny of the transactions and account throughout the course of the business relationship to ensure that the transactions being conducted are consistent with the registered intermediary’s knowledge of the customer, its business and risk profile, taking into account, where necessary, the customer’s source of funds.
Policy for acceptance of clients:
Clients should be accepted with proper introduction/references only. Such references may include existing clients, frenchisees, persons known to directors or employees, persons of repute or such other persons whose identity can be established without any doubts. However following points should be considered before accepting the clients:
No account is opened in a fictitious / benami name or on an anonymous basis.
b)
Factors of risk perception (in terms of monitoring suspicious transactions) of the client are clearly defined having regard to clients’ location (registered office address, correspondence addresses and other addresses if applicable), nature of business activity, trading turnover etc. and manner of making payment for transactions undertaken. Accordingly the clients should be classified into low, medium and high risk. Clients of special category (as given below) may, if necessary, be classified even higher. Such clients require higher degree of due diligence and regular update of KYC profile.
Clients of special category (CSC) include the following-
Non resident clients
High networth clients,
Trust, Charities, NGOs and organizations receiving donations
Companies having close family shareholdings or beneficial ownership
Politically exposed persons (PEP). Politically exposed persons are individuals who are or have been entrusted with prominent public functions in a foreign country, e.g., Heads of states or of Governments, senior Politicians, senior Government/judicial/military officers, senior executives of state owned corporations, important political party officials, etc.
Current / Former Head of State, Current or Former Senior High profile politicians and connected persons (immediate family, Close advisors and companies in which such individuals have interest or significant influence)
Companies offering foreign exchange offerings
Clients in high risk countries (where existence / effectiveness of money laundering controls is suspect or which do not or insufficiently apply FATF standards, where there is unusual banking secrecy, Countries active in narcotics production, Countries where corruption (as per Transparency International Corruption Perception Index) is highly prevalent, Countries against which government sanctions are applied, Countries reputed to be any of the following – Havens / sponsors of international terrorism, offshore financial centers, tax havens, countries where fraud is highly prevalent.
Non face to face clients
Clients with dubious reputation as per public information available etc.
Politically exposed persons (PEP). Senior management approval shall be required for establishing business relationships with politically exposed persons.
In addition to above, whether a new clients should be classified as CSC or not, should be independently judged as per the circumstances.
Documentation requirement and other information to be collected in respect of different classes of clients should be completed before opening the account.
The manner in which account should be operated, transaction limits for the operation, additional authority required for transactions exceeding a specified quantity / value and other appropriate details should be as per the risk management policy.
In case of non individual clients, the necessary authorisation should be obtained
It should be ensured that the identity of the client does not match with any person having known criminal background or is not banned in any other manner, whether in terms of criminal or civil proceedings by any enforcement agency worldwide. An updated list of individuals and entities which are subject to various sanction measures such as freezing of assets/ accounts, denial of financial services etc. as approved by security council committee established pursuant to various United Nations’s Security Council Resolutions (UNSCRs) can be accessed in the United nations website at http://www.un.org/sc/committees/1267/consolist.shtml .
Client identification procedure:
Client Opening form containing all the details as may be prescribed from time to time, should be completed in all respect and necessary enclosures should be obtained from the clients.
Photocopies should be verified from the originals for correctness.
In person verification shall be done of the client.
A recent photograph of the client in case the relationship is account based.
Identification and Address Proof must be compulsorily obtained.
No person should be allowed to register as a client and trade without PAN. PAN should be verified from Income Tax Web Site for correctness.
Client should be accessed with a proper introduction and reference only.
As far as possible, client’s office/residence should be visited for collection of details.
At the time of opening account, it should be determined from the introducer or other public information that the client is a existing/ potential politically exposed person (PEP) and in such case, additional information/ financial details may be asked from the client or publicly available information accessed.
list of documents to be obtained at the time of Account Opening for compliance with KYC requirement
Member is required to obtain a copy of one of the following documents as Proof of Identity and Proof of Address. In addition, obtaining PAN Card details of all the holders is compulsory for all categories of Trading account holder(s). The official accepting the account opening form should verify the photocopy of the PAN Card against the original, sign and stamp the copy and write: “verified with original” on the copy. The documents / information to be submitted by various categories of investors are as follows: -
Individuals
The documents prescribed by SEBI from time to time:
a. Proof of Identity:
I. Passport
II. Voter ID Card
III. Driving license
IV. PAN card with photograph
V. MAPIN card
VI. Identity card/document with applicant's photo, issued by Employer registered under MAPIN
b. Proof of Address
I. Ration card
II. Passport
III. Voter ID Card
IV. Driving license
V. Bank passbook
VI. Bill -
a) Electricity bills
b) Telephone bills
c) Flat Maintenance Bill
VII. Rent Agreement.
VIII. Certificate issued by employer registered under MAPIN
IX. Insurance Policy
The copies of abovementioned documents may be obtained after due verification with originals thereof.
Corporate, Firms and others
Copies of the Balance sheet for the last two financial years.
Copy of the latest shareholding pattern including list of all those holding more than 5% in the share capital of the company duly certified by the company secretary/ whole time director/ MD.
Copies of Certificate of Incorporation/ Registration Certificate and Memorandum and Articles of Association in case of a company/ body corporate/ partnership deed in case of a partnership firm, Trust Deed in case of trusts.
Copy of Resolution of Board of Directors approving participation in equity/ derivatives/ debt trading and naming authorized persons for dealing in securities
Photographs of partners/ whole time directors, individual promoters holding 5% or more either directly or indirectly, in the shareholding of the company and of persons authorized to deal in securities.
Proof of Identity of the person authorized to transact on its behalf
In addition, Bank and depository account details alongwith the proof of the same should also be obtained.
A detailed appreciation of the requirements under PMLA in the form of ‘Frequently Asked Questions’ (FAQs) will be available in the website address given below:
ANNEXURE III
Generation and distribution of reports
The record to be maintained mainly includes
All cash transactions of the value of more than rupees ten lakhs or its equivalent in foreign currency;
All series of cash transactions integrally connected to each other which have been valued below rupees ten lakhs or its equivalent in foreign currency where such series of transactions have taken place within a month;
All transactions involving receipts by non-profit organizations of value more than rupees ten lakh, or its equivalent foreign currency;
All cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine or where any forgery of a valuable security or a document has taken place facilitating the transactions;
All suspicious transactions whether or not made in cash
Suspicions transaction have been defined as a transaction including an attempted transaction, whether or not made in cash which, to a person acting in good faith -
Gives rise to a reasonable ground of suspicion that it may involve the proceeds of an offence specified in the schedule to the act, regardless of the value involved; or
Appears to be made in circumstances of unusual or unjustified complexity; or
Appears to have no economic rationale or bonafide purpose; or
Gives rise to a reasonable ground of suspicion that it may involve financing of the activities relating to terrorism.
Here transaction has been defined to include deposit, withdrawal, exchange or transfer of funds in whatever currency, whether in cash or by cheque, payment order or other instruments or by electronic or other non physical means.
Though the requirement is for transactions exceeding Rs.10 Lacs, however if there are some suspicious transactions made in such a way as to defeat this provision, the information should still be sent to FIU.
It may, however, be noted that for the purpose of suspicious transactions reporting, apart from ‘transactions integrally connected’, ‘transactions remotely connected or related’ should also be considered
An illustrative list of suspicious transactions is enclosed as List A.
Any suspicion transaction should be immediately notified to the Principal Officer. The notification may be done in the form of a detailed report with specific reference to the clients, transactions and the nature /reason of suspicion. However, it should be ensured that there is continuity in dealing with the client as normal until told otherwise and the client should not be told of the report/suspicion. In exceptional circumstances, consent may not be given to continue to operate the account, and transactions may be suspended, in one or more jurisdictions concerned in the transaction, or other action taken.
It is likely that in some cases transactions are abandoned/aborted by customers on being asked to give some details or to provide documents. It is to be noted that all such attempted transactions should also be reported in STRs, even if not completed by customers, irrespective of the amount of the transaction.
It is to be noted that if reasonable ground exists to believe that the transactions involve proceeds of crime, then STR should be filed irrespective of the amount of transaction and/or threshold limit envisaged for predicate offences specified in part B of schedule of PMLA, 2002.
Full details of accounts bearing resemblance with any of the individuals/ entities in the list approved by Security Council Committee established pursuant to United Nations Security Council Regulations (UNSCRs), should immediately be intimated to SEBI and FIU – IND.
Records of clients details should be properly kept and must be maintained for at least 5 years unless otherwise required. The record should be kept in a manner, which allows easy accessibility at all times.
The records of clients are duly maintained in such a way, that it allows easy accessibility.
LIST A
Illustrative list of suspicious transactions is as follows:
Client Identity/background
False / incorrect identification documents
Clients whose identity verification seems difficult or clients appears not to cooperate
Client not present for registration personally
Suspicious background or links with known criminals
Asset management services for clients where the source of the funds is not clear or not in keeping with clients apparent standing /business activity;
Clients in high-risk jurisdictions or clients introduced by banks or affiliates or other clients based in high risk jurisdictions.
Large number of accounts having common parameters such as common partners / directors / promoters / address / email address / telephone numbers / introducers or authorized signatories;
Doubt over the real beneficiary of account
Accounts opened with names very close to other established business entity.
Activity in account–
Unusual activity as compared to past transactions without apparent cause
Unusually large cash deposits made by an individual or business;
Clients transferring large sums of money to or from overseas locations with instructions for payment in cash;
Transfer of investment proceeds to apparently unrelated third parties;
Unusual transactions by CSCs and businesses undertaken by offshore banks /financial services, businesses reported to be in the nature of export-import of small items
Doubt over the real Trader of the account
Sudden activity in dormant accounts;
Purchases made on own account transferred to a third party through off market transactions through DP Accounts;
Suspicious off market transactions;
Large deals at prices away from the market.
Accounts used as ‘pass through’. Where no transfer of ownership of securities or trading is occurring in the account and the account is being used only for funds transfers/layering purposes.
Source of funds are doubtful or inconsistency in payment pattern;
Account used for circular trading/ insider trading
use of different accounts of clients alternatively
Particulars of Transactions–
Large sums being transferred from overseas
Inconsistent with the clients’ financial background
Transactions with no apparent economic or business rationale
Multiple transactions of value just below the threshold limit specified in PMLA so as to avoid possible reporting
Block deal which is not at market price or prices appear to be artificially inflated/deflated
ANNEXURE IV
FORMAT OF REPORTS AND FREQUENCY
Suspicious transactions are required to be reported to FIU in the prescribed formats which are divided into two parts- Manual Formats and Electronic Formats. Details of these formats are given in the documents (Cash Transaction Report- version 1.0 and Suspicious Transactions Report version 1.0 ) which are given below. These documents contain detailed guidelines on the compilation and manner/procedure of submission of the manual/electronic reports to FIU-IND. The related hardware and technical requirement for preparing reports in manual/electronic format, the related data files and data structures thereof are also detailed in these documents. Intermediaries, which are not in a position to immediately file electronic reports, may file manual reports to FIU-IND as per the formats prescribed. While detailed instructions for filing all types of reports are given in the instructions part of the related formats, intermediaries should adhere to the following:
The cash transaction report (CTR) (wherever applicable) for each month should be submitted to FIU-IND by 15th of the succeeding month.
The Suspicious Transaction Report (STR) should be submitted within 7 days of arriving at a conclusion that any transaction, whether cash or non-cash, or a series of transactions integrally connected are of suspicious nature. The Principal Officer should record his reasons for treating any transaction or a series of transactions as suspicious. It should be ensured that there is no undue delay in arriving at such a conclusion.
The Principal Officer will be responsible for timely submission of CTR and STR to FIU-IND;
Utmost confidentiality should be maintained in filing of CTR and STR to FIU-IND. The reports may be transmitted by speed/registered post/fax at the notified address.
No nil reporting needs to be made to FIU-IND in case there are no cash/suspicious transactions to be reported.
PRACTICAL GUIDELINES FOR IMPLEMENTATION OF PML POLICY
The client codes are allotted at HO only after all the details alongwith identification documents are received and checked at HO.
Contract Notes are signed by a senior level person who keeps an eye on the unusual transactions if any.
Reports showing exposure of clients as well as turnover are analyzed by a senior level personnel usually by a director.
Cash should not be accepted from the client. If for any reason, it is necessary to accept the cash, the same should be as per the relevant rules and regulations only.
No third party cheques should be accepted or issued. Further at the time of issue of cheques, Bank account no. of the client should also be mentioned in the cheque.
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