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Guideline on Anti-Money Laundering and the Combating of Terrorist Financinga) Is the customer known personally?b) Is the transaction in keeping with the customer's normal activity known to the financial institution, themarkets in which the customer is active and the customer's own business? (i.e. does it make sense?)c) Is the transaction in keeping with normal practice in the market to which it relates i.e. with reference tomarket, size and frequency?d) Is the role of the agent involved in the transaction unusual?e) Is the transaction to be settled in the normal manner?f) Are there any other transactions linked to the transaction in question which could be designed todisguise money and divert it into other forms or to other destinations or beneficiaries? and,g) Can you understand the reasons for the transaction i.e. might there be an easier, cheaper or moreconvenient method available?20.6 Internal reporting procedure20.6.1 Where the staff member conducts enquiries and obtains what he considers to be a satisfactoryexplanation of the complex, unusual or large 47 transaction, or unusual pattern of transaction, hemay conclude that there are no grounds for suspicion, and therefore take no further action as he issatisfied with matters. However, where the enquiries conducted by the staff member do notprovide a satisfactory explanation of the transaction, he may conclude that there are grounds forsuspicion requiring disclosure.20.6.2 Enquiries regarding complex, unusual large transactions, and unusual patterns of transactions,their background, and their result should be properly documented, forwarded to the ComplianceOfficer who will determine whether the transaction should be reported to the FIU as soon aspossible or within fourteen days of the date on which the financial institution knew or hadreasonable grounds to suspect that the funds used for the transaction were the proceeds of aspecified offence 48 .20.6.3 Enquiries to check whether complex or unusual transactions or structures have legitimateeconomic or lawful purpose, where conducted properly and in good faith, are not regarded astipping off.47 Refer to the POCA 55(3C) – a large transaction means a transaction, the value of which is ninety five thousand dollars or such other amountas the Minister may by Order prescribe.48 Refer to POCA Section 55 (3B).Page 43 of 75
Guideline on Anti-Money Laundering and the Combating of Terrorist Financing20.7 Reporting Declined Business20.7.1 It is normal practice for financial institutions to turn away business that they suspect might becriminal in intent or origin. Where an applicant for business or a customer fails to provide adequatedocumentation, including the identity of any beneficial owners or controllers, consideration shouldbe given to filing a SAR.20.7.2 Where an attempted transaction gives rise to knowledge or suspicion of money laundering orterrorist financing, that attempted transaction should be reported to the FIU. Reporting of suchevents will allow the FIU to build a clearer picture of the money laundering threat, and to use suchintelligence on a proactive basis. Furthermore, the financial institution should refrain from referringsuch business to other financial institutions20.7.3 Pursuant to the United Nations Resolutions on terrorist financing, financial institutions shouldfreeze any funds or other assets held for individuals or organisations listed on the UN list ofpersons connected to terrorism, and submit a report to the Authority. This list may be accessed atwww.un.org.21. RECORD KEEPING PROCEDURES21.1 Part V of the FOR stipulates the minimum requirements for financial institutions with regard to recordkeeping.21.2 To facilitate compliance with Part V of the FOR and to facilitate investigations undertaken by the FIU,financial institutions should establish a document retention policy that provides for the maintenance of abroad spectrum of records, including those related to customer identification, business transactions, internaland external reporting and training. Once a business relationship has been formed, the financial institutionshould maintain records of client identification and transactions performed.21.2.1 The document retention policy should incorporate the requirement that a financial institutions isrequired to keep records of all domestic and international transactions as well as identification dataon a customer for a minimum period of 6 years, unless a longer time period is required by otherstatutory requirements or mandated by the Central Bank. It may also be necessary for financialinstitutions to retain records, until such time as advised by the FIU or High Court, for a periodexceeding the date of termination of the last business transaction where there :a) has been a report of a suspicious activity; orb) is an on-going investigation relating to a transaction or client.Page 44 of 75
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