Anti-Money Laundering Policy 
(Pursuant to the provisions of circular No. RBI/2005-06/224 dt. 02.12.2005 & as amended by Circular No. 39 issued by RBI dated 26.06.2006)
Introduction
This policy has been made in compliance with the instructions of the Reserve Bank of India vide its circular no. RBI/2005-06/224 dated 02.12.2005 and it will come into force w.e.f. 1st April 2006.
Objective
In view of the increased concerns regarding money-laundering activities and to prevent the Company from being misused for such activities, it was felt that it is necessary for the Company to formulate suitable policies and procedures in this regard. This policy is an effort to develop a system in the Company to prevent Money Laundering Activities. The objective of this policy is to formulate such Anti-Money Laundering measures, which can prevent the Company from being misused for the Money Laundering activities.
Money Laundering:- Money Laundering can be called a process by which money or other assets obtained as proceeds of crime are exchanged for “Clean Money” or other assets with no obvious link to their criminal origins.
Scope of Policy
The policy is being made to formulate necessary measures for prevention of Money Laundering activities and these measures include the following:-
- Customer Identification Procedure- “Know Your Customer” norms
- Recognition, handling and disclosure of suspicious transactions
- Appointment of Money Laundering Reporting Officer (MLRO)
- Staff Training
- Maintenance of records
- Audit of transactions.
Key Policies
The Company hereby adopts the following key policies. The Company & its Branches/ employees/ officers/ authorities shall:
- Not knowingly launder money and have adequate procedures and controls to ensure that its money transfer business is not misused for money laundering and/or terrorist financing.
- Not advice customers on how to avoid identification, record keeping or reporting requirements.
- Not process a transaction unless it believes that it has a legitimate purpose.
- Comply with the laws of both countries involved in the transaction.
- Refuse obviously suspicious transactions.
- Report suspicious transaction in accordance with the applicable laws, instructions issued by RBI and Western Union Anti-Money Laundering Policies.
- Not split transactions to avoid government identification and reporting requirements or any policy of the concerned authority/ party.
- Not knowingly record false names or information.
- Not create false records.
- Co-operate with local regulators and law enforcement bodies.
- Not use consumer information collected for the purpose of managing Compliance or other risks for marketing or any other purpose.
- Maintain records in accordance with the law and concerned authorities.
- Ensure that its entire staff receives regular anti-money laundering training and that attendance at such training is documented.
- All employees of the Company, engaged in the money transfer/changing services shall execute any transaction only after verifying and obtaining a photocopy of a valid identification proof of the customer. The Branch will invariably retain photocopies of proof of identification after verifying the document in original. The identification proof must have a photograph of the customer.
- Full details of name and address as well as the details of the identity documents provided will be kept on record by the Branches.
- For purchase of foreign exchange less than US$200 or its equivalent, photocopies of the identification document need not be kept on record. However, full details of the identification document should be maintained.
- For encashment of foreign exchange between US$200 and US$2000 or its equivalent, the photocopies of the identification document should be maintained for one year and completion of statutory audit.
- For encashment in excess of US$2000 or its equivalent, the photocopies of the identification document should be maintained for a minimum period of five years.
(As amended by RBI vide its circular no. 39 dated 26.06.2006)
> If a transaction is being undertaken on behalf of another person, identification evidence of all the persons concerned should be obtained and kept on record by the concerned branch.
> Before completing the transaction, it is compulsory for the Branch to review the customer ID for the following:
- Must contain the customer’s photograph.
- Must be valid (current) not expired.
- Must be government issued.
- Must contain customer’s name.
- Customer’s address should be either mentioned on the identity proof or should be traceable based on such ID.
- The branch must maintain a photocopy of the photo ID.
- In case of foreign nationals only passport along with valid visa shall be accepted.
- In case of foreign nationals who have a refugee status in India, the refugee card may be accepted provided, additional precaution should be taken to take down the address and phone number of such persons.
Only following documents can be accepted as ID proof :
- Passport
- Driving Licence
- Voters ID
- PAN Card
- Refugee Card
- Bank Pass Book (photograph is mandatory)
- Army card
- Photo ID Cards issued by Central or State Government to its employees. This includes photo ID cards of Police or Army personnel. (Any ID issued to non employees will not be accepted).
Suspicious Transactions
The branches should be vigilant against the money laundering transactions at all times. The Branches should determine that whether a transaction is suspicious or not. A transaction may be of suspicious nature irrespective of the amount involved. The following are the possible suspicious activity indicators:
- Customer is reluctant to provide details/ documents on frivolous grounds.
- The transaction is undertaken by one or more intermediaries to protect the identity of the beneficiary or hide their involvement.
- Large cash transactions
- Size and frequency of transactions is high considering the normal business of the customer.
- Change in the pattern of business transacted etc.
Watch List Report:
The Compliance Officer will maintain and control a watch list to keep records of the individuals who were identified as showing unusual behavior or requesting transactions that were identified as questionable or suspicious. This report shall contain details such as the full names of the individuals, full address, contact details (if available), and possibly, a brief physical description of the individual(s).
An updated report shall be distributed to all locations on a regular basis so that it is readily available. If a person whose name is mentioned in the Watch List Report reaches the branch for transaction then the branch will not process the transaction and the MLRO & Compliance Officer should be intimated immediately about the matter.
Purchase of Foreign Exchange
- For purchase of foreign exchange less than US $ 200 or its equivalent, photocopies of the identification document need not be kept on record. However, full details of the identification document should be maintained.
- For encashment of foreign exchange between US $ 200 and US $ 2000 or its equivalent, the photocopies of the identification document should be maintained for one year and completion of statutory audit.
- For encashment in excess of US $ 2000 or its equivalent, the photocopies of the identification document should be maintained for a minimum period of five years.
- Payment of sale proceeds in cash:
Requests for payment of sale proceeds in cash may be acceded to extent of US$ 1000 or its equivalent per transaction. All encashment within one month may be treated as single transaction for the purpose. In all other cases payment should be made by way of "Account Payee" cheque/ demand draft only.
Explanation :
Requests for payment in cash by foreign visitors / Non-Resident Indians may be acceded to the extent of US $ 2000 or its equivalent. For any other party the limit will be US$ 1000 only.
(As amended by RBI vide its circular no. 39 dated 26.06.2006)
Production of declaration in CDF :
Where the amount of forex tendered for encashment by a non-resident or a person returning from abroad exceeds the limits prescribed for Currency Declaration Form (CDF), the Branch should invariably insist for production of declaration in CDF.
Sale of Foreign Exchange
- In all cases of sale of foreign exchange, irrespective of the amount involved, for identification purpose the passport of the customer should be insisted upon.
- The sale of forex should be made only on personal application and identification.
- Payment in excess of Rs. 50,000/- towards sale of foreign exchange should be received only by “Account Payee” cheques/ demand draft.
- All purchases by a person within one month may be treated as single transaction for the purpose.
- Encashment Certificate, wherever required, should also be insisted upon.
- Relationship with a business entity like a Company / firm should be established only after obtaining and verifying suitable documents in support of name, address and business activity such as certificate of incorporation under the Companies Act, 1956, Memorandum and Articles of Association of the Company, registration certificate of a firm (if firm is registered), partnership deed, etc.
- A list of employees who would be authorised to transact on behalf of the Company/ firm, the documents of their identification together with their signatures, should also be called for.
- Copies of all documents called for verification should be kept on record.
Appointment of Money Laundering Reporting Officer (MLRO) & Compliance Officer & His/Her Responsibilities
- An MLRO & Compliance Officer will be appointed by the Company, who will be responsible for monitoring the transactions and ensuring the compliance with the Anti-money laundering guidelines issued by the Reserve Bank of India from time to time.
- The MLRO & Compliance Officer will also be responsible for reporting of suspicious transaction(s) to the Financial Intelligence Unit (FIU).
- Any suspicious transaction(s), if undertaken, should have prior approval of MLRO.
- The MLRO & Compliance Officer shall have reasonable access to all the necessary information/ documents, which would help him in effective discharge of his responsibilities.
The MLRO & Compliance Officer will be responsible for the following:
- Putting in place necessary controls for detection of suspicious transactions.
- Receiving disclosures related to suspicious transactions from the staff or otherwise.
- Deciding whether a transaction should be reported to the appropriate authorities.
- Training of staff and preparing detailed guidelines/ handbook for detection of suspicious transactions.
- Preparing annual reports on the adequacy or otherwise of systems and procedures in place to prevent money laundering and submit it to the Top Management within 3 months of the end of the financial year.
- Consistently reviewing and keeping the management updated of local laws and regulations, guidelines issued by the authorities covering the matters related to the compliance of the law & instructions of regulatory authorities.
- The MLRO & Compliance Officer will ensure a compliant and secure money transfer system by
:
- Working co-operatively with governments, regulators and law enforcement agencies around the world.
- Supporting the enforcement of existing laws
- Promoting the use of workable solutions to prevent the improper use of the Western Union system.
- Implementing these policies across all the locations of the Company.
- Conduct training session for the field staff of the Company and document the attendance.
- Conduct periodic audit across the Company's Branches.
- Confirming the use of Voyager, which is a monitoring system that has the ability to import transaction and compliance information?
- Working co-operatively with governments, regulators and law enforcement agencies around the world.
Reporting of Suspicious Activity
- To the extent possible, all suspicious transactions shall be reported to the MLRO before they are undertaken.
- Full details of all suspicious transactions, whether put through or not, should be reported, in writing, to the MLRO. This report will contain the following details:
- A statement describing the grounds on which the employee believes the transaction to be suspicious.
- Details regarding full name, address, occupation etc. of the person related to the transaction.
- Physical description and photograph (if available) of the person related to the transaction.
- Any transaction which seems suspicious shall be undertaken only with prior approval of MLRO & Compliance Officer.
- MLRO & Compliance Officer will make a report to the appropriate authority i.e. Financial Intelligence Unit (FIU), about all the transaction for which he is satisfied that these transaction has/ may have resulted in money laundering.
Staff Training
The Company will have an ongoing training programme for the following purposes :
- For the consistent implementation of the Anti-Money Laundering measures.
- For giving the necessary training to all the managers and staff of the Company to make them aware of the policies and procedures relating to prevention of money laundering, provisions of the Prevention of Money Laundering Act, 2002 and the need of monitoring all transactions to ensure that no suspicious activity can be undertaken under the guise of money changing.
- To give the training to the staff for the necessary steps to be taken when they come across any suspicious transactions such as asking questions about the source of funds, checking the identification documents carefully, reporting immediately to the MLRO & Compliance Officer, etc.
The MLRO & Compliance Officer shall develop an Anti Money Laundering Compliance training program in consultation with the Board and the Western Union Compliance Officer and shall be responsible for updating it from time to time.
Audit & Compliance
- The concurrent auditor will check all transactions to verify that they have been done in compliance with the anti-money laundering guidelines/ policy and have been reported as required and if he finds any lacuna in compliance of the guidelines/ policies related to the money laundering, he will put up his report to the Board of Directors of the Company. The concurrenct Audit will be conducted as per the RBI rules i.e. every month in those branches where the monthly turnover is more then US$100000 and quarterly where the monthly turnover is less then US$100000.
- A certificate from the Statutory Auditor on the compliance with the Anti-Money Laundering Guidelines will be obtained at the time of preparation of the Annual Report and it will be kept in records by the Company.
Maintenance of Records
The following documents will be preserved for a minimum period of ten/ prescribed years:-
- Records including identification obtained in respect of all transactions.
- Statements/ Registers prescribed by the Reserve Bank of India from time to time.
- All inspection/ Audit/ Concurrent Audit Reports.
- Annual reports of the MLRO & Compliance Officer submitted to the Top Management.
- Details of all suspicious transactions reported in writing or otherwise to the MLRO & Compliance Officer.
- Details of all transactions involving purchase of foreign exchange against payment in cash exceeding Indian Rupees 10,00,000 for inter-related persons during one month.
- All correspondence/ reports with the appropriate authority in connection with suspicious transactions.
- References from Law Enforcement Authorities, including FIU, shall be preserved until the cases are adjudicated and closed.
Furnishing the Information
- A principal officer will be designated and his name & address will be intimated to the Director appointed under PMLA, 2002.
- An internal mechanism will be developed to furnish information as required by RBI from time to time.
- All instances of fake/counterfeit currency and suspicious actions will be reported to Director within 3 working days.
- Instances of cash transactions shall be reported by seventh day of succeeding month.
