Provisions under Prevention of Money Laundering Act for savings schemes

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Objective

Implementation of the following norms in the Post Offices:

Know Your Customers (KYC)Customer Due Diligence (CDD) • Purpose of the act is to prevent money laundering and

combating financing terrorism is small savings schemes• So, the above norms are to be applied in PO transactions

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Know your customer

• Three risk categories defined

• Norms for each category spelt out.

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Three risk categories : Know your customer

Risk Category Accounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto

Low Risk Up to Rs.50,000

Medium Risk Exceeding Rs.50,000 and up to Rs.10 lakh

High RiskExceeding Rs.10 lakh and balance in all accounts and certificate exceed Rs 10 lakh

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Low Risk : Norms

Low RiskAccounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto amount below Rs.50000/-

Norms Proof

Photograph 1 Recent Photographs (2 in case of EDBO)

Identity proof Any one of the following :Electoral Photo identity card, Ration card with photograph, Passport, Driving License, POSB identity card, PO ID card, Govt. Identity card, (PPO, BPL, Job card), Aadhar Card (UIDAI), Identity card issued by schools and colleges.

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Low Risk : NormsNorms Proof

Address proof Any one of the following :Bank or Post Office Passbook/Statement withcurrent address• Passport with current address.• Ration Card with current Address.• Electricity Bill of not more than three months old• Telephone Bill of not more than three monthsold• Salary Slip of reputed Employer with currentaddress.• Certificate from any Public Authority/Postman orGram Dak Sewak Delivery Agent or BranchPostmaster.• The letter issued by the Unique IdentificationAuthority of India ( UIDAI) containing details ofname, address and Aadhaar number.

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Medium Risk : Norms

Medium Risk Accounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto amount exceeding Rs.50000/- but up to Rs.10 lakhs

Norms Proof

Photograph 1 Recent Photographs (2 in case of EDBO)

Identity proof Any one of the following :Mandatory : PAN or Declaration in Form 60/61Electoral Photo identity card, Ration card with photograph, Passport, Driving License, POSB identity card, PO ID card, Govt. Identity card, (PPO, BPL, Job card), Aadhar Card (UIDAI), Identity card issued by schools and colleges.POSB identity card, Govt. Identity card, (PPO, BPL, Job card), PAN card

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Medium Risk : NormsNorms Proof

Address proof Any one of the following :Bank or Post Office Passbook/Statement withcurrent address• Passport with current address.• Ration Card with current Address.• Electricity Bill of not more than three months old• Telephone Bill of not more than three months old• Salary Slip of reputed Employer with currentaddress.• Certificate from any Public Authority/Postman orGram Dak Sewak Delivery Agent or BranchPostmaster.• The letter issued by the Unique IdentificationAuthority of India (UIDAI) containing details ofname, address and Aadhaar number.

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High Risk :

High Risk Accounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto amount above Rs.10 lakhs

Norms ProofPhotograph 1 Recent Photographs

(2 in case of EDBO)

Identity proof Any one of the following :Mandatory : PAN or Declaration in Form 60/61Electoral Photo identity card, Ration card with photograph, Passport, Driving License, POSB identity card, PO ID card, Govt. Identity card, (PPO, BPL, Job card), Aadhar Card (UIDAI), Identity card issued by schools and colleges.POSB identity card, Govt. Identity card, (PPO, BPL, Job card), PAN card

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High Risk :

Norms Proof

Address proof

Any one of the following :Bank or Post Office Passbook/Statementwith current address• Passport with current address.• Ration Card with current Address.• Electricity Bill of not more than three monthsold• Telephone Bill of not more than three monthsold• Salary Slip of reputed Employer with currentaddress.• The letter issued by the Unique IdentificationAuthority of India (UIDAI) containing detailsof name, address and Aadhaar number.

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High Risk :

Norms Proof

Additional requirement

Copy of document showing source of receipt of funds tendered for investment is necessary

Note : If interest on SCSS is exceeding Rs.10000 in a year and declaration in form 15G & 15H is not given , PAN Card is mandatory

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FAQs Minors - If account/certificate holder is minor, norms are applicable to guardians Joint Holders- In case of joint holders , norms are applicable to all joint

account/certificate holders• Attestation - Documents should be self-attested or in case of illiterate depositors

should be attested by Gazetted Officer/Sarpanch/ Branch/Sub/Head/Chief Postmaster or Postman/Gram Dak Sewak

• Delivery Agent KYC documents already submitted - Customer who have already submitted KYC

documents in any purchase, need not to submit these again. Account number/purchase application number through which KYC documents were given earlier to be mentioned. Note : Name and address of the customer should match with earlier KYC Documents. The Supervisor to pass the remarks “KYC documents already submitted vide A/C No./Regn. No.___dated____”

Deposit is made through agent - The agent should also attest all KYC documents. In case of direct investment, self attestation or attestation by Gazetted Officer is required.

Mandatory : “KYC documents Verified and attached” needs to be written by the Supervisor on account opening form or purchase application

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Record keeping : Documents

Post Office POSB Accounts Certificates

HO KYC documents (including those received from EDBOs should be attached with Account Opening Forms or kept in guard files

KYC documents (including received from EDBOs) should be attached with account opening or purchase application forms and kept in guard files.

SO RD/MIS/SCSS should be kept with account opening form or purchase application

SB/TD/PPF KYC documents should be kept in guard files.

KYC documents should be attached with account opening or purchase application forms and kept in guard files.

BO KYC Documents should be attached with account opening form and sent to Account Office.

KYC Documents should be attached with account opening or purchase application form and sent to Account Office.

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Record keeping : Documents

Post Office POSB Accounts and Certificates Attestation

HO Photo attached with Account Opening form or purchase application

APM to Attest photograph from ID proof.

SO Photo should be pasted in the SS Book (In case of SB/TD/PPF). In other cases i.e. RD/MIS/SCSS, pasted in A/C opening form .

SPM to Attest photograph from ID proof.

BO Two. One photo should be pasted in the SS Book and one in account opening form.

BPM to Attest photograph from ID proof.

Note : In case of SCSS two photographs are mandatory i.e. one for application form and another for Passbook

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Record keeping : Preservation

Record relating of all transactions to be preserved by SBCO 5 years

All Purchase Applications along with KYC documents 5 years after discharge.

At the time of closure of account, account opening form along with KYC documents should be attached with closure voucher and transferred to SBCO

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Reporting of transactions

Category (Cash Transaction) Method of monitoring

All cash transactions exceeding 10,00,000/-Prepare list & send to :

•Head of Division on 3rd working day of following month.•Head of the Division to Circle by 5th working day •Head of the Circle to Principal officer at Directorate by 8th working day

All cash transactions in series which are less than 10,00,000/- at a time but are integrated & total exceeds 10,00,000/- in a month

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Reporting of transactions

Category (Suspected Transaction) Method of monitoring

Cash is accepted & Forged or counterfeit currency notes used or forgery of Security or documents

Prepare list & send to :•Head of Division (by name) on the very same day.•Head of the Division to Head of Circle (by name ) on the very same day of receipt of STR from PO•Head of the Circle to DDG (PCO), PMLA (by name) at Directorate on the very same day of receipt of STR from Head of the Division.

Any attempted transaction of Forged or counterfeit currency notes used or forgery of Security or documents

Suspected transaction

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Definition of Suspicious transaction• A transaction including an attempted transaction, whether or

not made in cash which, to a person acting in good faith-(i) gives rise to a reasonable ground of suspicion that it may

involve proceeds of an offence specified in the schedule to the Act regardless of the value involved: or

(ii) appears to be made in circumstances of unusual or unjustified complexity: or

(iii) appears to have no economic rationale or bonafide purpose: or

(iv) give rise to a reasonable ground of suspicion that involve financing of the activities relating to terrorism;

(v) Transaction includes deposit, w/d, exchange or transfer of funds in whatever currency, whether in cash or in cheque , payment order or other instruments or by electronic or other physical

means.

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Instructions for existing Accounts/Certificates

EXISTING ACCOUNTS

Types of measures to be taken

Procedure

KYC A printed notice will be handed over to the depositor / messenger at the time of next transaction (deposit / withdrawal) after receipt of this SB Order

In case of RD accounts opened through agents, the ID and Address proof should also be attested by agent concerned

CDD/KYC documents are also required to be taken in the existing accounts in case of Transfer of account, revival of silent account or when depositor’s signatures not matched with existing specimen

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Instructions for existing Accounts/Certificates

EXISTING ACCOUNTS

Types of measures to be taken

Procedure

KYC Depositors or certificate holders to be served notice to furnish KYC. If he does not furnish KYC upto 3rd transaction, 4th transaction will not be allowed.

In case of fresh investment, the photocopy of existing passbook, certificate to be enclosed with application form

Transfer / revival of account to be allowed only if he furnishes the KYC

Transfer of maturity amount to be allowed only if he furnishes the KYC

If the existing account is closed, fresh KYC are to be taken

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General instructions

Types of measures to be taken

Procedure

KYC In case of prospective customer living with relative, the customer should give ID proof and address proof of relative followed by relative’s self-declaration that prospective customer stays with him

In case the depositor does not co-operate in furnishing KYC, the matter should be reported to Divisional Supdt. who will order closure of this A/C and inform depositor of taking such decision.

Record keeping Same as prescribed for new accounts/certificates

Reporting Same as prescribed for new accounts/certificates

Suspected transaction

Report be sent immediately as prescribed for new customer 21

Penalty

• In case of non-implementation of AML/CFT norms, a penalty from Rs.10,000 to Rs. 1,00,000 can be imposed under PML Act and rules in addition to disciplinary action.

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