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MONEY LAUNDERING
PREVENTION
PROGRAM
FOR
COOPERATIVE
INSURANCE SYSTEM OF
THE PHILIPPINES
TABLE OF CONTENTS
Chapter 1 - Anti Money Laundering Overview AMLA and AMLC Overview Definition of Money Laundering
Unlawful Activities Requirement of AMLA Covered Institution Types of Report Covered Transaction Suspicious Transaction Offenses and Penalties
Chapter 2 - Requirement and Procedure for AMLA
Specific Persons and its Function KYC Process Valid Identification Documents Minimum Requirements for Individual Minimum Requirements for Cooperative Procedure Transaction Reporting For Covered Transaction For Suspicious Transaction Procedure Record Keeping Chapter 3 – Procedure on Submitting the Report to AMLC
CHAPTER 1
What is AMLA?
Republic Act No. 9160 otherwise known as The Anti-Money Laundering Act of 2001 was signed into law on September 29, 2001 and took effect on October 17, 2001. The implementing Rules and Regulations took effect on April 2, 2002. On March 7, 2003, R.A. No. 9194 (An Act Amending R.A. No. 9160) was signed into law and took effect on March 23, 2003. The revised Implementing Rules and Regulations took effect on September 7, 2003.
What is AMLC?
The Anti-Money Laundering Council is composed of the Governor of the Bangko Sentral ng Pilipinas (BSP) as Chairman and the Commissioner of the Insurance Commission (IC) and the Chairman of the Securities and Exchange Commission (SEC) as members. It acts unanimously in the discharge of its functions.
The AMLC is assisted by a Secretariat headed by an Executive Director and consists of five (5) units; the Compliance and Investigation Group (CIG), the Legal Evaluation Group (LEG), the Information Management and Analysis Group (IMAG), Technical Services Staff (TSS) and the Administrative and Financial Services Division (AFSD).
AMLC is the organization where the Money Laundering Report will be submitted.
What is Money Laundering?
Money Laundering is a crime whereby the proceeds of an unlawful activity are transacted or attempted to be transacted to make them appear to have originated from legitimate sources.
Unlawful Activity is the offense which generates dirty money or property. It is commonly called
the predicate crime. It refers to any act or omission or series or combination thereof involving or
having direct relation to the following:
Kidnapping for ransom Drug trafficking and related offenses Graft and corrupt practices Plunder Robbery and Extortion Jueteng and Masiao Piracy Qualified theft Swindling Smuggling
Violations under the Electronic Commerce Act of 2000 Hijacking; destructive arson; and murder, including those perpetrated by terrorists
against non-combatant persons and similar targets Fraudulent practices and other violations under the Securities Regulation Code of 2000 Felonies or offenses of a similar nature that are punishable under the penal laws of other
countries. Terrorism financing and organizing or directing others to commit terrorism financing (R.A.
10168). Attempt/conspiracy to commit terrorism financing and organizing or directing others to
commit terrorism financing (R.A. 10168). Attempt/conspiracy to commit dealing with property or funds of designated person. Accomplice to terrorism financing or conspiracy to commit terrorism financing. Accessory to terrorism financing.
Requirements of AMLA
Know Your Customer (KYC) Policy
Reporting of Covered and Suspicious Transactions
Records Keeping
Who are Covered Institution?
Covered Institutions are those mandated by the AMLA to submit covered and suspicious Transaction reports to the AMLC. These are:
Banks and all other entities, including their subsidiaries and affiliates, supervised and regulated by the Bangko Sentral ng Pilipinas
Insurance companies, pre-need companies and all other institutions supervised or regulated by the Insurance Commission
Securities dealers and other entities supervised or regulated by the Securities and Exchange Commission
Types of Report
Covered transactions are single transactions in cash or other equivalent monetary instrument involving a total amount in excess of Five Hundred Thousand (P500, 000.00) Pesos within one (1) banking day
Suspicious transactions are transactions with covered institutions, regardless of the amounts involved, where any of the following circumstances exists:
there is no underlying legal/trade obligation, purpose or economic justification; the client is not properly identified;
the amount involved is not commensurate with the business or financial capacity of the client;
the transaction is structured to avoid being the subject of reporting requirements under the AMLA;
there is a deviation from the client’s profile/past transactions; the transaction is related to an unlawful activity/offense under the AMLA; and transactions similar or analogous to the above.
Offenses and Penalties
Knowingly transacting or attempting to transact any monetary instrument/property which represents, involves or relates to the proceeds of an unlawful activity. Penalty is 7 to 14 years imprisonment and a fine of not less than P3M but not more than twice the value of the monetary instrument/property.
Knowingly performing or failing to perform an act in relation to any monetary instrument/property involving the proceeds of any unlawful activity as a result of which he facilitated the offense of money laundering. Penalty is 4 to 7 years imprisonment and a fine of not less than P1.5M but not more than P3M.
Knowingly failing to disclose and file with the AMLC any monetary instrument/property required to be disclosed and filed. Penalty is 6 months to 4 years imprisonment or a fine of not less than P100,000 but not more than P500,000, or both.
Failure to keep records is committed by any responsible official or employee of a covered institution who fails to maintain and safely store all records of all transactions of said institution, including closed accounts, for five (5) years from the date of the transaction/closure of the account. Penalty is 6 months to 1 year imprisonment or a fine of not less than P100,000 but not more than P500,000, or both.
Malicious reporting is committed by any person who, with malice or in bad faith, reports/files a completely unwarranted or false information relative to money laundering transaction against any person. Penalty is 6 months to 4 years imprisonment and a fine of not less than P100,000 but not more than P500,000, at the discretion of the court. The offender is not entitled to avail the benefits of the Probation Law.
If the offender is a corporation, association, partnership or any juridical person, the penalty shall be imposed upon the responsible officers, as the case may be, who participated in, or allowed by their gross negligence, the commission of the crime.
If the offender is a juridical person, the court may suspend or revoke its license. If the offender is an alien, he shall, in addition to the penalties prescribed, be deported
without further proceedings after serving the penalties prescribed. If the offender is a public official or employee, he shall, in addition to the penalties
prescribed, suffer perpetual or temporary absolute disqualification from office, as the case may be.
Breach of confidentiality. When reporting covered or suspicious transactions to the AMLC, covered institutions and their officers/employees are prohibited from communicating directly or indirectly, in any manner or by any means, to any person/entity/media, the fact that such report was made, the contents thereof, or any
other information in relation thereto. In case of violation thereof, the concerned official and employee of the covered institution shall be criminally liable. Neither may such reporting be published or aired in any manner or form by the mass media, electronic mail or other similar devices. In case of a breach of confidentiality published or reported by media, the responsible reporter, writer, president, publisher, manager and editor-in-chief shall also be held criminally liable. Penalty is 3 to 8 years imprisonment and a fine of not less than P500,000 but not more than P1M.
CHAPTER 2
1. List of Specific Persons and its Function
Chairman of the Cooperative - is the chief officer of Cooperative elected or appointed by Board of Directors and is charged with the supervision and management of high level affairs of the organization such as making corporate policy or approving actions of the management. He is also primarily responsible to overall Cooperative Operations specially transactions which are related to AMLA. Compliance Officer - is an employee of the Cooperative with at least a rank of manager appointed by the Board of Directors who is primarily responsible for the overseeing and managing of regulatory compliance issues and ensuring that the organization is compliant with said regulatory concerns. In AMLA reporting, its main function is to collaborate all reportable transaction and check applicable guidelines issued by the AMLC. Submission of report is also one of his/her responsibilities since encryption is named under his/her. Alternate Compliance Officer - is an officer of the Cooperative with at least a rank of a manager appointed by the Board of the Directors, who in the absence of the compliance officer, is responsible for all the functions left by the Compliance Officer including the actual submission of the report but under his/her own encryption name.
2. The KYC Processes
Member’ personally
appear in the
Cooperative
Member’s identity
verified by any
Cooperative staff
Verify Identification Card
presented and member’s
specimen signature
Check name against
watch lists
Check completeness of
information requirement
and authenticity of all
documents submitted
Member must personally appear in the cooperative
Then, cooperative staff verify member’s identity through the following:
- Verify member’s presented ID
- Verify signature in duly accomplished application form against file copy of specimen
signature
- Check member’s name against watch lists
- Check completeness of information requirement and authenticity of all documents
submitted
Valid Identification Documents
Passport
Driver’s license
PRC ID
Police clearance
Postal ID
TIN ID
GSIS ID e-Card
SSS ID
OWWA ID
OFW ID
SEC
DSWD certification
Integrated Bar of the Phil. (IBP) ID
NBI clearance
National ID
Student ID
Voter’s ID
SEC Certificate
Company ID
Barangay certification
Gov’t Office and GOCC
Senior citizen’s card
Seaman’s Book
ACR/Immigrant Certificate of Registration ID (e.g. AFP, HDMF)
Certification from National Council for Welfare and Devt. (NCWDP)
Business Registration Certificate
Minimum Information (Individual)
1. Name 2. Complete Present address 3. Complete Permanent address 4. Date and place of birth 5. Nature of work and name of employer or nature of self-employment/business 6. Contact details 7. Specimen signature 8. Source of funds, including country of origin 9. Complete Permanent address 10. Nationality 11. TIN, SSS or GSIS numbers, if any 12. Name, present address, date and place of birth, nature of work and source of funds of
beneficiary. 13. Valid ID
Minimum Information (Cooperative)
1. Name 2. Complete Business address 3. Date and place of birth/Certificate of Registration by pertinent government agency 4. Contact Details 5. Nature of business 6. Nationality 7. Articles of Cooperative and By Laws
Procedures:
1. To include on Memorandum of Agreement (MOA) the responsibility of Cooperative to personally verify information in each member individual. For those Cooperative with existing MOA, an Addendum is required.
2. For insured individual with insured amount of more than P500, 000, the Underwriting Unit must ensure that all minimum requirements are met both for individual and cooperative before accepting insurance application.
3. Reporting
Covered transaction- to be reported to AMLC within 10 days from transaction date Suspicious transactions- to be reported to AMLC within 10 days from date of knowledge or discovery.
Should a transaction be deemed to be both a covered and suspicious transaction, the same shall be reported as a suspicious transaction.
Procedures:
Preparation of Transaction Report
Head Office Marketing Unit
Prepare report base on
the discussed AMLA
format
Submit the report to the
Unit Supervisor and Unit
Head for checking
Forward to Compliance
Officer or to the
Alternate Compliance
Officer
Accomplish the AMLA
form
Forward to HO. make
sure that the report is
sealed and label it as
follow “AMLA Report- to
be viewed only by the
Compliance officer”.
Submit the report to the
General Agency manager
for checking
1. For Head Office Unit
Head Office employee is required to submit a softcopy of the report to the compliance officer and a hardcopy of the same together with his/her complete name, position and signature.
Prepared by: Checked by: Certified Correct:
Staff Supervisor Manager
Units having one junior officer
Prepared by: Certified Correct:
Staff Supervisor or Manager
2. Marketing Unit
Insurance agent accomplish the AMLA form. Marketing Agent to indicate his/her name and affix his/her signature on the Prepared by portion and forward it to your corresponding General Agency Manager. The GAM will then sign and forward the same to Head Office Compliance officer.
When reporting covered or suspicious transactions to AMLC, the Organization and its officers and employees are prohibited from communicating, directly or indirectly, in any manner or by any means, to any person, entity, the media the fact that a covered or suspicious transaction report was made, the contents thereof, or any other information in relation thereof. Neither such reporting be published or aired in any manner or form by the mass media, electronic mail, or other similar devices. In case of violation thereof, the concerned officer, and employee, of the covered institution, or media shall be held criminally liable. Refer to Chapter 1 (Offenses and Penalties).
The covered and suspicious reports should follow the prescribed format discuss here at
head office. Meanwhile for the Marketing Agent see Annex A for the AMLA form. The reports should be reported to the Compliance Officer within five (5) days from transaction date/date of knowledge or discovery to give ample time to consolidate the reports.
4. Records Keeping
Purpose: for reconstruction and for audit trail
Transaction records- to be kept for five (5) years from the date of transaction
Report subject of money laundering case- to be retained beyond five (5) years until it is
confirmed that the case has been finally resolved or terminated by the court. The
concerned unit must make sure that the records are safely kept and intact.
CHAPTER 3
Procedure on Submitting the Report to AMLC
1. The Report Received from the different Units will be consolidated by the Compliance
Officer every day.
2. The softcopy of the report will be checked by the Compliance Officer based on the CSV
File format checker of the AMLC while the hardcopy will be filed for future references.
3. When an error occur while checking, it should be corrected immediately by the
Compliance Officer together with the concerned unit.
4. Once the Report is found to have “no error”, the Compliance Officer will sign and encrypt
it using the Kleopatra. Said system is made available by AMLC.
5. The encrypted report will be uploaded on the AMLC Portal. Any bad records or error that
may occur should be corrected together with the concerned unit.
6. Maximum of 5 days is given to the Compliance officer to finish the uploading in the AMLC
portal starting from the date the report was received from various units.
7. The Preparer of the Report is the assigned Compliance Officer or the Alternate
Compliance Officer while the Chairman of the CISP will be in full responsibility as a whole.
Received
Reports from
Head Office Unit
and Marketing
Unit
Check report from
the CSV file format
checker
Sign and encrypt
the report using
the Kleopatra
Upload the
report on the
AMLC Portal
ANNEX A
AMLA FORM
Type of Transaction: ___________________________________________________________ Date Reported: ___________________________________________________________ Transaction Date: ___________________________________________________________ Amount: ___________________________________________________________ Policy Effective Date: ___________________________________________________________ Maturity Date: ___________________________________________________________ Term of Insurance: ___________________________________________________________ Policy Owner (Cooperative) Name of Cooperative: ___________________________________________________________ Complete Address: ___________________________________________________________ Registration Date: ___________________________________________________________ Place of Registration: ___________________________________________________________ ID Type (ex. Registration Certificate):_______________________________________________________ ID No: ___________________________________________________________ Insured (Individual) Complete Name: ___________________________________________________________ Complete Address: ___________________________________________________________ Birthdate: ___________________________________________________________ Place of Birth: ___________________________________________________________ ID Type (ex. Tin) ___________________________________________________________ ID No: ___________________________________________________________ Beneficiary Complete Name: ___________________________________________________________ Complete Address: ___________________________________________________________ Birthdate: ___________________________________________________________ Place of Birth: ___________________________________________________________ Relationship to beneficiary: ___________________________________________________________ Designation (Revocable or Irrevocable):_____________________________________________________ Prepared by: ___________________________ Name and Signature
Noted by:
___________________________ Name and Signature
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