Provisions under Anti Money Laundering Act 3(a).1

Objective Implementation of the following norms in the Post Offices: Know Your Customers (KYC) Customer Due Diligence (CDD) For the purpose of implementations of provisions on prevention of Money laundering Act 2002 & CFT, MOF Department of Economic affairs (Budget division) has formulated the Prevention of money laundering & combating of financing Terrorism in small savings schemes. The above norms are to be applied in Post Office transactions. 3(a).2

Know your customer Three risk categories defined Norms for each category spelt out. 3(a).3

Three risk categories : Know your customer Risk CategoryAccounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto Low RiskUp to Rs.50,000 Medium RiskExceeding Rs.50,000 and up to Rs.10 lakh High RiskExceeding Rs.10 lakh and balance in all accounts and certificate does not exceed Rs 10 lakh 3(a).4

Low Risk : Norms- Three risk categories : Know your customer Low Risk Accounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto amount below Rs.50000/- NormsProof 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. Address proof Any one of the following : Electoral Photo identity card, Bank/POSB-PB/Current electricity bill/telephone bill (Not more than 3 months old), certificate from any public authority including area postman GDS or BPM, letter issued by UIDAI

Medium Risk : Norms- Three risk categories : Know your customer Medium Risk Accounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto amount between Rs.50000/- to Rs.10 lakhs NormsProof Photograph 1 Recent Photographs (2 in case of EDBO) Identity proof Any one of the following : Mandatory : PAN or Declaration in Form 60/61 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. POSB identity card, Govt. Identity card, (PPO, BPL, Job card), PAN card Address proof Any one of the following : Electoral Photo identity card, Bank/POSB-PB/Current electricity bill/telephone bill (Not more than 3 months old), certificate from any public authority including area postman GDS or BPM, letter issued by UIDAI

High Risk : Norms- Three risk categories : Know your customer High Risk Accounts opened upto amount / Certificate purchased upto amount / Balance in all accounts and savings certificates upto amount above Rs.10 lakhs NormsProof Photograph 1 Recent Photographs (2 in case of EDBO) Identity proof Any one of the following : Mandatory : PAN or Declaration in Form 60/61 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. POSB identity card, Govt. Identity card, (PPO, BPL, Job card), PAN card Address proof Any one of the following : Electoral Photo identity card, Bank/POSB-PB/Current electricity bill/telephone bill (Not more than 3 months old), letter issued by UIDAI Additional requirement Copy of source of funds is necessary Note : If interest on SCSS is exceeding Rs in a year and declaration in form 15G & 15H is not given, PAN Card is mandatory

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  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.  Deposit is made through agent - The agent should attest all KYC documents. In case of direct investment, self attestation or attestation by Gazetted Officer is required. 3(a).8

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  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 1.8.9

Record keeping : Documents Post OfficePOSB AccountsCertificates 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.

Record keeping : Documents Post OfficePOSB Accounts and CertificatesAttestation 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

Record keeping : Preservation Record relating of all transactions to be preserved by SBCO5 years All Purchase Applications along with KYC documents5 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

Reporting of transactions Category (Cash Transaction)Method of monitoring All cash transactions exceeding 10,00,000/- Prepare list & send to : Head of Division on 3 rd of following month. Head of the Division to Circle by 5 th Head of the Circle to Principal officer at Directorate by 8 th 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 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 on next working day. Head of the Division to Circle by next working day of receipt from PO Head of the Circle to Principal officer at Directorate by next working day of receipt from Head of the Division. Any attempted transaction of Forged or counterfeit currency notes used or forgery of Security or documents Suspected transaction 3(a).12

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. 3(a).13

Instructions for existing Accounts/Certificates (only in case of suspicion) 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

Instructions for existing Accounts/Certificates (only in case of suspicion) 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 3 rd transaction, 4 th 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

Instructions for existing Accounts/Certificates (only in case of suspicion) EXISTING ACCOUNTS 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

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. 3(a).15