Beruflich Dokumente
Kultur Dokumente
4 August 2009
- Anuj Narayan
- Dhara Kothari
- Jyoti Jhaveri
- Mittal Patel
- Vikram Soni
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Table Of Contents
1. Overview
2. Meaning / Definitions
3. Stages/Process
4. Techniques
5. Indicators
6. Risks
7. Impact
8. Relationship with Terrorism
9. Combating Measures
10.Role Of Chartered Accountants
11.Inference
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Overview
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Meaning / Definitions
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Meaning / Definitions (Cont.)
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Stages / Process (Cont.)
Placement
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Stages / Process (Cont.)
Layering
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Stages / Process (Cont.)
Integration
Putting laundered proceeds into the legitimate
economy so that the proceeds
appear to be from normal business activities.
• Reinjecting laundered proceeds into economy so that they
reenter financial system as normal business funds
• Provides an apparently legitimate explanation
to criminally derived wealth
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Stages / Process (Cont.)
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Techniques Employed
1. Smurfing/ Deposit structuring
2. Shipping Money Abroad
3. Credit/ Debit cards
4. Use Of “Pass Through” Or “Payable Through”
Accounts
5. Electronic Wire Transfers
6. Loan Back Arrangement
7. Correspondent Banking
8. Trading And Other Business Activities
9. Lawyers, Accountants & other Intermediaries
10.Placement Using Insurance Products
11.Placement Using Investment Related Transactions
12.Misuse of Non Profit Organisations (NPOs)
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Indicators
Suspicious Transactions
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Indicators (Cont.)
Transaction Stage
• Customer requests for avoiding Bank’s normal
documentation requirements.
• Customer refuses to provide information necessary for
Banks to make report / records as per regulatory
requirements
• Customer provides information that Bank determines
to be false
• Customer splits transactions involving cash deposits in
order to avoid threshold limit reporting requirements
• Customer seeks to change or cancel a transaction after
informing of currency transaction reporting,
information, verification or record keeping
requirements
• Customer exhibits unusual concern about secrecy or
requests information regarding
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conceal
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Indicators (Cont.)
Trade Finance
• Wire transfers
• Other Inward/Outward remittances
• Review Letter of Credits,
Shipment of items inconsistent with customer’s
business
Irregular pricing of goods
Excessively amended letters of credit
Transactions designed to avoid home country legal
restrictions
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Indicators (Cont.)
Red/Warning Flags
• High activity and low balances
• Insensitivity to transaction charges
• Credits by different people into same account
• Immediate turnaround (ins and outs)
• Refusal to provide identification or other information
• Desires unnecessarily complex transactions
• Reference by persons impossible to contact/ difficult
to verify
• Inadequate or unusual documentation
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Risk
1. Reputational
2. Operational
3. Legal
4. Concentration
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Risk (Cont.)
Reputational
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Risk (Cont.)
Legal
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Impacts
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Impacts (Cont.)
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Relationship With Terrorism
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Relationship With Terrorism (Cont.)
As per the Monograph on Terrorists Financing
Terrorist Financing (issued by the 9/11 enquiry commission),
preparations for the 9/11 attacks cost between
US$400,000 and US$500,000-of which about
US$300,000 was spent in the United States.
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Relationship With Terrorism (Cont.)
Identifying
Irregular / Suspicious
Transactions
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Combating Money Laundering (Cont.)
Indian Initiatives
PMLA Act, 2002
• Maintenance of Records of transactions
Every banking company or financial institution or
intermediary, as the case may be, shall maintain a
record of
All cash transactions of the value of more than rupees
ten lakhs or its equivalent in foreign currency ;
ll series of cash transactions integrally connected to
each other having a value below rupees ten lakhs or
its equivalent in foreign currency where such series of
transactions have taken place within a month
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
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has taken place
Combating Money Laundering (Cont.)
All suspicious transactions whether or not made in
cash and by way of :
Cheques, Travelers Cheques, A/c Transfer, Credits or
debits into or from any non-monetary accounts, Money
transfer or remittances, Loans and Advances,
Collection Services
• RBI issued
A TATA a circular on29Feb 16, 2006 reiterating the
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above rules. With regard to accounts for which a SAR
Combating Money Laundering (Cont.)
International Efforts
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Role Of Chartered Accountants
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Inference
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