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KYC Policy

KYC/AML/CFT {Know your customer/ Anti-Money laundering/ Combating of Financing Terrorism policy}of the Bank as adopted by the Bank vide proceedings No:  44 dated 24/03/2012  of the Part-Time Administrator/Joint Registrar of Co-operative Societies (General). 


Objective of the Policy
(a) Objective of KYC/AML/CFT guidelines is to prevent banks from being used, intentionally or unintentionally, by criminal elements for money laundering or terrorist financing activities. 
(b) Strict adherence to policy will enable the bank to know it’s customers and their financial dealings better and thus help in prudent management of risks.
(c) To put in place appropriate controls for detection and reporting of suspicious activities in accordance with applicable laws /laid down procedures.
(d) To comply with applicable laws and regulatory guidelines
(e) To ensure that concerned staff are adequately trained in KYC/AML/CFT procedures

Scope of the Policy
This policy is applicable to all Branches/Offices of the Alappuzha DCCB and is to be read in conjunction with related operational guidelines issued from time to time. This policy being introduced vide this Circular will come into force immediately and will be in vogue till an amendment /super cession of the same is being intimated.
Principal Officer
Bank has appointed Shri.M.S.Sreekumar, Deputy General Manager as Principal Officer in charge of monitoring and reporting of all transactions and sharing of information as required under the law and timely submission of statements to FIU-IND. Principal Officer shall be located at the head/corporate office of the bank
Definition of Customer 
For the purpose of Bank’s KYC policy, a ‘Customer’ is defined as :

  • a person or entity that maintains an account and/or has a business relationship with the bank;
  • one on whose behalf the account is maintained (i.e. the beneficial owner).
  • [Beneficial Owner' means the natural person who ultimately owns or controls a client and or the person on whose behalf a transaction is being conducted, and includes a person who exercise ultimate effective control over a juridical person]

    • beneficiaries of transactions conducted by professional intermediaries, such as Stock Brokers, Chartered Accountants, Solicitors etc. as permitted under the law, and
    • any person or entity connected with a financial transaction which can pose significant reputational or other risks to the bank, say, a wire transfer or issue of a high value demand draft as a single transaction.

    Definition of Money Laundering
    Section 3 of PMLA has defined the “offence of money laundering “as under:
    “Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime and projecting it as untainted property shall be guilty of offence of money laundering” For the purpose of this policy the term money laundering “would also cover financial transactions where the end use of funds goes for terrorist financing irrespective of the source of the funds” 
    All remittance of funds by way of demand  draft, mail/telegraphic transfer or any other mode and issue of travellers’ cheques for value of Rupees fifty thousand and above is effected by debit to the customer’s account or against cheques and not against cash payment

    Banks should ensure that the provisions of Foreign Contribution (Regulation) Act, 1976 as amended from time to time, wherever applicable are strictly adhered to.
    Definition of Suspicious Transactions
    “Suspicious transaction” means 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 proceeds of an offense specified in the schedule of the Act, regardless of the value involved, or
    • appears to have no economic rationale or bonafide reason
    • gives rise to a reasonable ground of suspicion that it may involve financing of the activities relating to terrorism

    KYC POLICY KYC policy of the 
    Bank incorporates the following four key elements:

    1) Customer Acceptance Policy (CAP)
    2) Customer Identification Procedures (CIP)
    3) Monitoring of Transactions
    4) Risk Management.
    5) Staff training and customer education
    6) Internal Control systems and record keeping
    7) Duties/responsibility and accountability

    1.Customer Acceptance Policy (CAP) 
    (i) No account is to be opened in anonymous or fictitious/ benami name. Bank will not allow the opening of or keep any anonymous account or accounts in fictitious name or account on behalf of other persons whose identity have not been disclosed or cannot be verified. 
    (ii) Accept customers only after verifying their identity as laid out in the customer identification procedures (CIP). Necessary checks should be done to make sure the identity of the customers does not match with any person with known criminal background or with banned entities such as individual terrorists or terrorist organizations 

    (ii) All customers shall be categorized into low, medium and high risk . 
    (iii) Documentation requirements and other information to be collected in respect of different categories of customers depending on perceived risk and CIP and keeping in mind the requirements of PML Act, 2002 and instructions/ guidelines issued by Reserve Bank from time to time will be complied with 

    (iv) Implementation of CAP should not be so restrictive as to deny banking services or lead to harassment of customers. Decision by a bank to close an account should be taken at a reasonably high level after giving due notice to the customer explaining the reasons for such a decision.
    (v) Circumstances, in which a customer is permitted to act on behalf of another person/entity, should be clearly spelt out in conformity with the established law and practice of banking as there could be occasions when an account is operated by a mandate holder or where an account is opened by an intermediary in fiduciary capacity 
    (vi) A profile for each new customer based on risk categorization will be developed 
    (vii) Information collected from the customer for the purpose of opening of account is to be treated as confidential and details thereof are not to be divulged for cross selling or any other like purposes. Information sought from the customer should not be intrusive and should be in conformity with the guidelines issued in this regard. 
    Method of risk categorization,

     

    • Individuals (other than High Net Worth) and entities whose identities and sources of wealth can be easily identified and transactions in whose accounts by and large conform to the known profile may be categorised as low risk.

    [Examples of low risk customers are salaried employees whose salary structures are well defined, people belonging to lower economic strata of the society whose accounts show small balances and low turnover, Government Departments and Government owned companies, regulators and statutory bodies etc.]

    • Customers that are likely to pose a higher than average risk to the bank should be categorised as medium or high risk depending on customer's background, nature and location of activity, country of origin, sources of funds and his client profile etc.

    [Examples of customers requiring higher due diligence include (a) non­resident customers; (b) high net worth individuals; (c) trusts, charities, NGOs and organizations receiving donations; (d) companies having close family shareholding  or  beneficial  ownership; (e)  firms with  'sleeping partners'; (f) politically exposed persons (PEPs) of foreign origin, customers  who are close relatives  of PEPs and accounts of which a PEP is the ultimate beneficial owner; (g) non-face to face customers and (h) those with dubious reputation as per public information available etc. However only NPOs/NGOs promoted by United Nations or its agencies may be classified as low risk customer.] 
    2.Customer Identification Procedure (CIP)
    1) Customer identification means identifying the customer and verifying his/her identity by using reliable, independent source documents, data or information. Banks need to obtain sufficient information necessary to establish, to their satisfaction, the identity of each new customer, whether regular or occasional, and the purpose of the intended nature of banking relationship. 
    The Features to be verified and documents to obtain as part of the CIP are given in Annexure I. However the same is indicative and not an exhaustive list.
    2)  Whenever there is suspicion of money laundering or terrorist financing or when other factors give rise to a belief that the customer does not, in fact, pose a low risk
    (a) Branch should carry out full scale customer due diligence (CDD) before opening an account
    b) where there are doubts  about the adequacy  or veracity of previously  obtained customer identification  data, banks should review  the due diligence measures  including verifying again  the identity of the client and obtaining information  on the purpose  and intended nature  of the business relationship. 
    3)In cases wheresome close relatives, e.g. wife, son, daughter andparents, etc. live with their husband, father/mother and son, as the case may be and where all bills such as the utility bills required for address verification are not in their name, branches can obtain an identity document and a utility bill of the relative with whom the prospective customer is living along with a declaration from the relative that the said person (prospective customer) wanting to open an account is a relative and is staying with him/her. Any supplementary evidence such as a letter received through post can be further used for verification of the address. 
    5)Branches should periodically update customer identification data (including photograph/s) after the account is opened. The periodicity of such updation should not be less than once in five years in case of low risk category customers and not less than once in two years in case of high and medium risk categories.

     

    Customer Identification Requirements 
    (i)  Walk in customers
    In the case of walk-in/ non-account based customers, where the amount of transaction is equal to or exceeds rupees fifty thousand, whether conducted as a single transaction or several transactions that appear to be connected, the customer's identity and address should be verified.  If branch has reason to believe that a customer is intentionally structuring a transaction into a series of transactions below the threshold of Rs.50,000/- the bank should verify identity and address of the customer and also consider filing  a suspicious transaction report (STR) to FIU-IND
    NOTE:  In terms of Clause (b) (ii) of sub-Rule (1) of Rule 9 of the PML Rules, 2005 banks and financial institutions are required to verify the identity of the customers for all international money transfer operations 
    (ii) Trust/Nominee or Fiduciary Accounts
    Branch should determine whether the customer is acting on behalf of another person as trustee/nominee or any other intermediary. If so, banks should insist on receipt of satisfactory evidence of the identity of the intermediaries and of the persons on whose behalf they are acting, as also obtain details of the nature of the trust or other arrangements in place. While opening an account for a trust, branch should take reasonable precautions to verify the identity of the trustees and the settlers of trust (including any person settling assets into the trust), grantors, protectors, beneficiaries and signatories. Beneficiaries should be identified when they are defined. In the case of a 'foundation', steps should be taken to verify the founder managers/ directors and the beneficiaries, if defined.
    iii) Accounts of companies and firms
    Banks need to be vigilant against business entities being used by individuals as a ‘front’ for maintaining accounts with banks. Banks should examine the control structure of the entity, determine the source of funds and identify the natural persons who have a controlling interest and who comprise the management.
    iv) Client accounts opened by professional intermediaries 
    If account is opened by a professional intermediary 
    a) is on behalf of a single client, that client must be identified. 
    b) In the case of ‘pooled’ accounts managed by professional intermediaries on behalf of entities like mutual funds, pension funds or other types of funds the branch must look through the beneficial owners. Where funds held by the intermediaries are not co-mingled at the bank and there are 'sub-accounts', each of them attributable to a beneficial owner, all the beneficial owners must be identified. 
    v)  Accounts of Politically Exposed Persons (PEPs) resident outside India
    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.

    • The decision to open an account for PEP should be taken at a senior level.
    • Banks should gather sufficient information on any person/customer of this category intending to establish a relationship and check all the information available on the person in the public domain.
    • Banks should verify the identity of the person and seek information about the sources of funds before accepting the PEP as a customer.
    • Banks should also subject such accounts to enhanced monitoring on an ongoing basis. The above norms are applicable to the accounts of the family members or close relatives of PEPs.
    • In the event of an existing customer or the beneficial owner of an existing account, subsequently becoming a PEP, banks should obtain senior management approval to continue the business relationship and subject the account to the CDD measures as applicable to the customers of PEP category including enhanced monitoring on an ongoing basis. 

    vii) Accounts of proprietary concerns 
    Branch should  call  for and  verify  the  following documents before opening of accounts in the name of a proprietary concern:

    a) Proof of the name, address and activity of the concern, like registration certificate (in the case of a registered concern), certificate/ license issued by the Municipal authorities under Shop & Establishment Act, sales and income tax returns, CST/VAT certificate, certificate/registration document issued by Sales Tax/Service Tax/Professional Tax authorities, License issued by the Registering authority like Certificate of Practice issued by Institute of Chartered Accountants of India, Institute of Cost Accountants of India, Institute of Company Secretaries of India, Indian Medical Council, Food and Drug Control Authorities, etc.  
    b) Any two of the above documents would suffice. These documents should be in the name of the proprietary concern. 
    c) These guidelines on proprietorship concerns will apply to all new customers, while in case of accounts of existing customers; the above formalities should be completed in a time bound manner.
    viii) Small Deposit Accounts 
    It has been observed that a large number of persons, especially, those belonging to low income group both in urban and rural areas are not able to produce such documents to satisfy the bank about their identity and address. This would lead to their inability to access the banking services and result in their financial exclusion. 
    Accordingly, the KYC procedure also provides for opening accounts for those persons who intend to keep balances not exceeding Rupees Fifty Thousand (Rs. 50,000/-) in all their accounts taken together and the total credit in all the accounts taken together is not expected to exceed Rupees One Lakh (Rs. 1,00,000/-) in a year. In such cases, if a person who wants to open an account and is not able to produce documents mentioned in Annex I of this circular, banks should open an account for him, subject to:

    • Introduction from another account holder who has been subjected to full KYC procedure.
    • The introducer’s account with the bank should be at least six months old and should show satisfactory transactions.
    • Photograph of the customer who proposes to open the account and also his address needs to be certified by the introducer.
    • any other evidence as to the identity and address of the customer to the satisfaction of the bank.
    • if at any point of time, the balances in all his/her accounts with the bank (taken together) exceeds Rupees Fifty Thousand (Rs. 50,000/-) or total credit in the account exceeds Rupees One Lakh (Rs. 1,00,000/-) in a year, no further transactions will be permitted until the full KYC procedure is completed.

    ix) Correspondent Banking
    a) Relationships with correspondent banks will be established only with the approval of the Board.
    b) Information on the other bank’s management, major business activities, level of AML/CFT compliance, purpose of opening of account, identity of any third party entities that will use the correspondent banking services and the regulatory/supervisory framework should be ascertained.
    c) Relationship and scope of activities covered under the correspondent banking arrangement should be clearly documented.
    d) Bank will ensure that correspondent bank has sufficient systems and procedures to comply with KYC/AML/CFT guidelines.
    e) Term/recurring deposit accounts are subject to revised KYC procedures at the time renewal of the deposits on the basis of materiality and risk
    x) KYC of existing accounts
    a) The KYC guidelines will also apply to existing customers on the basis of materiality and risk. 
    b) Transactions in existing accounts should be monitored for any unusual pattern in the operation of the accounts. 
    c) The existing accounts of charities, firms, trusts, companies, religious institutions ad other institutions should be subjected to minimum KYC standards which would establish their identity and beneficial owners.
    3.Monitoring of Transactions 
    1. Identify transactions that fall outside the regular pattern of activity. 
    2. Pay attention to unusually large transactions and all unusual patterns which have no apparent economic or visible lawful purpose. 
    3. Transactions that involve large amounts of cash inconsistent with the normal and expected activity of the customer should particularly attract the attention of the branch. 
    4. Very high account turnover inconsistent with the size of the balance maintained may indicate that funds are being 'washed' through the account. 
    5. Information accompanying all domestic wire/ electronic transfers of Rs.50000/- (Rupees Fifty Thousand) and above (whether of customers or not) must include complete originator information i.e. name, address PAN Number and account number etc.
    6. All remittance of funds by way of demand  draft, mail/telegraphic transfer or any other mode and issue of travellers’ cheques for value of Rupees fifty thousand and above will be  effected only by debit to the customer’s account or against cheques and not against cash payment.
    7. If a bank has reason to believe that a customer is intentionally structuring wire transfer to below Rs. 50000/- (Rupees Fifty Thousand) to several beneficiaries in order to avoid reporting or monitoring, the bank must insist on complete customer identification before effecting the transfer. In case of non-cooperation from the customer, efforts should be made to establish his identity and Suspicious Transaction Report (STR) should be made to FIU­-IND.
    8. Interbank transfers and settlements where both the originator and beneficiary are banks or financial institutions would be exempted from the above requirements.
    9. Branches are required to report all cash deposits and withdrawals of Rs.10 lakh and above as well as transactions of a suspicious nature with full details in fortnightly statements to the Head Office 
    4. Risk Management 
    The Board of Directors of the bank shall ensure that an effective KYC programme is put in place by establishing appropriate procedures and ensuring their effective implementation

    • The bank shall nominate a senior executive officer as Principal Officer in charge of KYC/AML/CFT implementation and  for reporting to the FIU-IND
    • All staff members of the bank are bound to implement this policy in a meticulous manner.
    • A copy of the KYC policy to be made available to all staff members of the bank by the functionaries concerned.
    • The bank will ensure that no account of terrorist organizations as being advised by RBI / Other higher offices is being opened at the branches and no transaction of the said organizations are entertained by the bank.
    • The Bank will acknowledge receipt of all circulars of the aforesaid nature to RBI /Other Higher Offices without delay and publicize the contents of the circulars to all concerned.
    • The bank will ensure safe custody of the Account Opening Form and Identity Proof, for a period not less than 10 years from the date of closure of the account.
    • The audit and inspection team of Bank will be special attention to implementation of the KYC policy of the Bank by its branches and ensure compliance in case of any deviation.
    • On receipt of the list of individuals and entities subject to UN sanctions (referred to as designated lists) from RBI, bank will ensureexpeditious and effectiveimplementation of the procedure prescribed under Section 51A of UAPA in regard to freezing/unfreezing of financial assets of the designated individuals/entities enlisted in the UNSCRs and especially, in regard tofunds, financial assets or economic resources or related services held in the form of bank accounts.
    • While opening accounts of organizations receiving contributions from abroad ,it should be ensured that the organization is registered with Government Of India to confirm compliance to the provisions of Foreign Contribution Regulation Act 1976 .Also , the cheques of only such registered organizations be collected by the bank .
    • Any suspicious transactions as noticed by the Branches and functionaries should immediately be reported to the PO at the Head Office, who in turn will report the same to FIU – IND, New Delhi.
    • The present software being used by the bank will be updated as and when required in line with the changing facets of the policy.Bank will enable its software to maintain updated designated lists in electronic form and run a check on the given parameters on a regular basis to verify whether individuals or entities listed in the schedule to the Order (referred to as designated individuals/entities) are holding any funds, financial assets or economic resources or related services held in the form of bank accounts with them.
    • In case, the particulars of any of their customers match with the particulars of designated individuals/entities, the banks 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 bank accounts, held by such customer on their books to the Joint Secretary (IS.I), Ministry of Home Affairs, at Fax No.011-23092569 and also convey over telephone on 011-23092736, to UAPA nodal officer of RBI, Chief General Manager, Department of Banking Operations and Development, Anti Money Laundering Division, World Trade Centre, Centre-1, 4th Floor, Cuffe Parade, Colaba, Mumbai –400005 and also by  fax  at No.022-22185792 and also to the FIU-IND. The particulars apart from being sent by post/fax should necessarily be conveyed by email as well:

    5)  Staff Training and Customer Education 
    Implementation of KYC procedures requires banks to demand certain information from customers which may be of personal nature or which has hitherto never been called for. This can sometimes lead to a lot of questioning by the customer as to the motive and purpose of collecting such information. The front desk staff needs to be specially trained to handle such situations while dealing with customers so as to educate the customer of the objectives of the KYC programme. Banks will have an ongoing employee training programme so that the members of the staff are adequately trained in KYC procedures so that all those concerned fully understand the rationale behind the KYC policies and implement them consistently.
    6) Internal control systems and record keeping
    Bank shall introduce a system of maintaining proper record of transactions prescribed under Rule 3 of PML Rules, 2005, as mentioned below:

    a) all cash transactions of the value of more than Rupees Ten Lakh or its equivalent in foreign currency;

    b) all series of cash transactions integrally connected to each other which have been valued below Rupees Ten Lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the aggregate value of such transactions exceeds Rupees Ten Lakh;

    c) all transactions involving receipts by non-profit organisations of value more than rupees ten lakh or its equivalent in foreign currency [Ref: Government of India Notification dated November 12, 2009- Rule 3,sub-rule (1) clause (BA) of PML Rules] 

    d) all cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine and where any forgery of a valuable security or a document has taken place.
    d) All suspicious transactions whether or not made in cash and by way of as mentioned in the Rules.  
    e) Bank will maintain all necessary information on the nature of the transactions; the amount of the transaction and the currency in which it was denominated; 
    the date on which the transaction was conducted; and
    the parties to the transaction
    f) Bank will maintain the records containing information of all transactions including the records of transactions detailed in Rule 3 above for at least ten years after the business relationship is endedas required under Rule 10 of the Rules ibid
    g) In terms of the PMLA Rules, Bank will submit details of all suspicious transactions and all transactions involving  receipts  by non-profit organisations of value  more than rupees ten lakh  or its equivalent  in foreign currency to the Director, Financial Intelligence Unit-India (FIU-IND) in respect of transactions referred to in Rule 3 at the following address:
    Director, FIU-IND,
    Financial Intelligence Unit-India,
    6th Floor, Hotel Samrat,
    Chanakyapuri,
    New Delhi-110021.
    Website - http://fiuindia.gov.in/
    h) The audit and inspection team of Bank will be special attention to implementation of the KYC policy of the Bank by its branches and ensure compliance in case of any deviation.
    i) An independent evaluation of KYC guidelines for identifying high value transactions is required to be carried out by the Concurrent/Internal Auditors. They are required to comment on the effectiveness of measures taken by the branches in the implementation of KYC guidelines and prevention of Money Laundering at branches/offices.
    Cash and Suspicious Transaction Reports 
    Cash Transaction Report
    i) The Cash Transaction Report (CTR) for each month should be submitted to FIU?IND by 15th of the succeeding month. Cash transaction reporting by branches to their controlling offices should, therefore, invariably be submitted on monthly basis 
    b)  A copy of the monthly CTR submitted on its behalf to FIU-India is available at the concerned branch for production to auditors/inspectors, when asked for; and 

    b) Suspicious Transaction Reports (STR)

    i) 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 clarified that banks should report all such attempted transactions in STRs, even if not completed by customers, irrespective of the amount of the transaction.

    ii) 
    Banks should make STRs if they have reasonable ground to believe that the transaction involve proceeds of crime generally irrespective of the amount of transaction 
    iii) The Suspicious Transaction Report (STR) should be furnished 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 once a suspicious transaction report is received from a branch or any other office. Such report should be made available to the competent authorities on request.

    iv)
     Banks should not put any restrictions on operations in the accounts where an STR has been made. Banks and their employees should keep the fact of furnishing of STR strictly confidential, as required under PML Rules.  It should be ensured that there is notipping off to the customer at any level. 
    7) Duties/responsibility and accountability
    The Bank employees will conduct themselves in accordance with the highest ethical standards and in accordance with extant regulatory requirements and laws. Staff and management shall not provide advice or other assistance to individuals who are indulging in money laundering activities.


    Personnel

    Duties/responsibilities

     

    Branch Manager/ Officer vested with the authority to open new accounts

     

     

    1. To interview the potential customer. 
    2.To verify the introductory reference/customer profile
    3.To identify suspicious transactions
    4.To ensure that accounts are not opened in the name of banned/ terrorist organizations
    5.To adhere to the provisions of Foreign Contribution Regulatory Act, 1976
    6. To comply with the guidelines issued by the Bank from time to time I in respect of opening ad conduct of account.

     

    Principal Officer

     

     

     

    1. Overall monitoring of the implementation of the Bak’s KYC/AML/CFT policy
    2. To ensure timely dispatch of CTR, STR and CCR reports to FIU-IND 
    3. To report suspicious transactions as per report obtained from branches to appropriate authrority within the required time frame.
    4. Maintaining liaison and sharing information as required under law with law enforcement agencies, banks and other institutions, which are involved in the fight against money laundering and combating financing of terrorism.

     

    General Manger/controlling authority

    .

    Ensure prompt reporting of information regarding suspicious transactions to the maw enforcing authority concerned in consultation with the Principal Officer I the Head Office.

     

    Review of Policy
    The policy will be reviewed as and when considered necessary by the Management.

     

    GENERAL MANAGER

    ANNEXURE I- CHECK LIST

    FEATURES TO BE VERIFIED AND DOCUMENTS TO BE OBTAINED FROM CUSTOMERS

    SL.NO

    FEATURES

    DOCUMENTS

    1.

    ACCOUNTS OF INDIVIDUALS

    Recent photograph and any document which provides customer information to the satisfaction of the branch.

    Legal name and any other name used

    Passport
    PAN card
    Voter’s Identity card
    Driving License
    Identity card (subject to the Bank’s satisfaction)

    Correct Permanent address

    Letter from recognized public authority or public servant verifying the identity and residence of the customer to the satisfaction of branch.
    Telephone Bill
    Bank account statement 
    Electricity Bill
    Ration card
    Letter from Employer

     

    2.

    ACCOUNTS OF COMPANIES

    Certificate of incorporation and memorandum of articles of Association

     

    Name of the company

    Resolution of the Board of Directors to open an account and identification of those who have authority to operate the account

    Mailing address of the Company

    Copy of PAN allotment letter

    3.

    ACOUNTS OF PARTNERSHIP FIRMS

    Registration certificate , if registered

    Legal Name

    Partnership deed

    Address

    Power of Attorney granted to a partner or an employee of the firm to transact business on its behalf

    Names of all partners and their addresses

    Any officially valid document identifying the partners and the persons holding the Power of Attorney and their addresses.

    Telephone numbers of the Firm and partners

    Telephone bill in the name of the firm and partners

    4.

    ACCOUNTS OF TRUSTS AND FOUNDATIONS

     

    Names of trustees, settlers, beneficiaries and signatories

    Certificate of registration, if registered. Power of Attorney granted to transact business on its behalf

    Names and address of the founder, the managers/directors and beneficiaries

    Any officially valid document to identify settlers, beneficiaries and those holding Power of Attorney, founders/managers/ directors addressed

    Telephone/fax number

    Resolution of the managing body of foundation/association 
    Telephone Bill.

     

    ANNEXURE II-FOR PAN

     

    CATEGORY OF CUSTOMER

    PROCEDURE ADOPTED

    1

    Account holders having PAN and recorded with Bank

    Note the Pan number in the DD/TT/MT/RTGS/NEFT application form for affixing PAN under the signature of the account holder

    2

    Account holders not having PAN since their income (from all sources) falls below the Income tax exemption limit

    A declaration in Form No.60 of I.T rules to be obtained. The declaration is to be obtained along with application form.

    3

    Account holders not allotted PAN even though applied for it but their income is assessed for income Tax and Assessment order issued by appropriate authority

    A declaration in Form No: 60 of It rules to be obtained. The account holder should give a suitable statement in the form. The official in-charge of the draft/Mt business in the branch should act diligently and satisfy him self about the genuineness of the statement.

    4

    Account holders who have agricultural income and is opt in receipt of any other income chargeable ot income Tax

    A declaration in form No: 61of It rules to be obtained. The declaration is to be obtained along with application form.

    5

    Account holder whose income is neither assessed for It nor applied for PAN and not fall under any of the above categories (1) to (4) above

    The account holder is advised to obtain the PAN and application for purchase of DD/MT/TT/RTGS/NEFT
    Will be politely rejected.

     

    Annexure - III

    Transaction of suspicious nature- Indicative List

    (I) Transactions not consistent with customers business

    1. Frequent withdrawals in cash by corporate customers, instead of cheque transactions without giving cogent reasons.

    2. Customers insisting on cash payment of cheques drawn in the name of the firm without routing through their account, quoting reason for pressing payment of outstanding dues.

    3. High value deposits routed through newly opened accounts and gradual cash withdrawals leaving small balances.

    4. A single substantial cash deposit composed of many high denomination notes.

    5. Instruments with multiple endorsements.

    6. Accounts where large volume of credits through DD/TT/BC whereas the nature of business does not justify such credits.

    7. Frequent exchange of small denomination notes for large denomination notes and vice versa in large quantities.

    8. Frequent credits in cash into the account by person other than the account holder or his authorized representative.

    (II) Attempt to avoid reporting/ circumventing prescribed guidelines

    1. Frequent issue of demand drafts/banker's cheques / telegraphic transfers for sums deposited in cash just below threshold limit of Rs.50,000/- thereby not routing the transaction though the account.

    2. Intentional splitting of transactions into small amounts to avoid reporting of transaction which may become necessary in case the threshold limit is crossed.

    3. Requesting Bank to open multiple accounts with a view to circumvent reporting by the Bank as per existing regulations.

    4. Frequent opening and closing of accounts in short duration of time with a view  to  avoiding  reporting  of  transactions  involved  as  per  existing regulations.

    (iii) Unusual activities

    1. Opening of account at places away from place of work/residence of the individual/firm.

    2. Frequent operations in safe deposit lockers followed by cash deposits especially deposits just under the threshold levels.

    3. Frequent deposit of large sums of money bearing labels of other banks into the accounts.

    4.  Request for closure of newly opened accounts where high value transactions have been routed through them and funds withdrawn immediately.

    (iv) Customers who provide insufficient or suspicious information

    1.  Reluctance of the customer/corporate to furnish details about their activities or providing financial statements.

    2. A customer who has no record of past or present employment but makes frequent large transactions through the account.

    3. Letter of thanks sent to the customer/introducer returned undelivered.

    (v) Certain Bank employees arousing suspicion

    1. Unexplained shortages of significant amount of Bank's funds reported on account of the same employee(s).

    2. Reluctance to take job rotation/routine transfer.

    3. Employee does not avail leave/vacation.

    4. Negligence of employee's willful blindness is reported repeatedly.

    5. Life-style of the employee inconsistent with the known sources of income.

    6.  Frequently exceeding the discretionary power and allowing excess drawings to borrowers without proper justification/reporting to appropriate authority for control.

    7. Request for frequent DD purchases of high value instruments by staff members.

     

    Some examples of suspicious activities/ transactions to be monitored by the operation staff

    • Large cash transactions.

    • Multiple accounts under the same name.

    •  Frequently  converting  large  amounts  of  currency  from  small  to  large denomination notes.

    • Placing funds in term deposits and using them as security for more loans.

    • Large deposits immediately followed by wire transfers.

    • Sudden surge in activity level.

    • Same funds being moved repeatedly among several accounts.

    • Multiple deposits of money orders, Banker's cheques, drafts of third parties etc.

    • Transactions inconsistent with the purpose of the account.

    • Maintaining a low or overdrawn balance with high activity. Note

    Indicators for suspicious transactions

    1. Suspicion of proceeds of crime
    2. Match of customer details with known criminals or persons with suspicious background
    3. Match with UN list –Customer has been the subject of a law enforcement inquiry
    4. Customer who conducts transactions in a pattern consistent with criminal proceeds
    5. Lottery scam or recruitment scam
    6. Multi-level marketing
    7. Transaction from high risk or sensitive area
    8. Unusual or complex transaction
    9. Transaction is unnecessarily complex Unusual single or aggregate transfers 
    10. Transaction is inconsistent with customer profile
    11. Routing of transfer through multiple locations or accounts or unexplained transfers between accounts
    12. “U-Turn” Transactions
    Structuring - transactions split to evade reporting
    13. Unexplained activity in dormant accounts
    14. Suspicious use of ATM card
    15. Doubtful source of payment for credit card purchases

    No economic rationale or bonafide purpose

    1. Volume or frequency of transactions has no economic rationale 
    2. Use of agents or associates to disguise the beneficial owner Common Unique IDs used by multiple customers
    3. Common address/telephone used by multiple unrelated customers
    4. Multiple cash transactions in a single day
    5. Transactions with countries known for secret banking practices
    6. Transactions inconsistent with customer’s profile 
    7. Frequent cash transactions just under the reporting threshold
    8. Multiple cash transactions in multiple accounts
    9. Cash deposits followed by issue of instruments
    10. Suspicious cash withdrawals from bank account
    11. High value cheque deposits followed by immediate cash withdrawals
    12. Maintaining multiple accounts without explanation Unexplained cash deposits in bank account

    Non Financial Indicators Usage of Lockers Behavioural Indicators

    1. Customer is hurried, nervous or evasive
    2. Customer has no or little knowledge about transaction
    3. Customer is accompanied by unrelated individuals.
    4. Reluctance to meet in person, representing through power of attorney 
    5. Customer aborts transaction after being informed that identification information will be required
    6. Reluctance to provide original ID
    7. Customer makes inquiries or tries to convince staff to avoid reporting 
    8. Providing different identifications or details (such as phone or address) on different occasions in an attempt to avoid linking of transaction.

    Knowledge Indicators
    1. Customer tries to convince staff not to complete the formalities
    2. Customer thoroughly aware of legal position on suspicious transaction reporting.
    3. Customer seems very conversant with money laundering or terrorist activity financing issues.
    4. Customer is quick to volunteer that funds are clean or not being laundered.

     

    Identity indicators

    1. Customer doubtful or vague information given.
    2. Customer gives false identification or identification that appears to be counterfeited, altered or inaccurate.
    3. Instead of his own some other identification is submitted by Customer.
    4. All Identity documents presented are not verifiable i.e. foreign documents etc.
    5. All identification documents appear to be recently acquired.
    6. Identity matches with known ‘hot/watch lists’

    Transactions indicators

    1. Frequent cash transactions in large amounts which is not normally done by the customer.
    2. Small denominations frequently changed for large ones.
    Dirty/smelly notes deposited.
    3. Customer consistently makes cash transactions that are just under the reporting threshold amount in an apparent attempt to avoid the reporting
    threshold .
    4. Frequent purchase of travellers cheques, DDs, etc. with cash when this appears to be outside of normal activity for the client.

    Accounts Indicators

    1. A long distance customer opening an account/s.
    2. Account/s opened with names closer to established industrial houses/
    groups.
    3. Intra bank transfer of funds - accumulated into one account for foreign remittance.
    4. Opening of several accounts simultaneously, some of which remain dormant for long periods.
    5. A third party appears to be using the account of customer.
    6. Customer frequently using different locations other than the place of account opening to deposit funds.

    Activity in account

    1. Account activity inconsistent with nature of business.
    2. Transaction involves NGOs or charitable organization for which there appears to be no logical economic purpose or where there appears to be no link between the stated activity of the NGO or charitable organization and the other parties in the transaction.
    3. Transaction is unnecessarily complex.

NEWS & EVENTS

 CASH AWARD FOR ACADEMIC EXCELLENCE TO EMPLOYEES OF AFFILIATED SOCIETIES

ADCB invites application from eligible employees/ relatives of employees of affiliated societies for cash award for academic excellence for the academic year 2018-19. Applications in the prescribed form with attestation from respective society and branches of DCB  shall be submitted on or before 06.09.2019. Applications are available from nearest bank branches or can be downloaded from DOWNLOADS section of website.

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