Indicators for suspicious transactions::::( Most important exam and General( Daily) Banking point of view) ( Every one read this article at least once)
Suspicion of proceeds of crime
Match of customer details with known criminals or persons with suspicious
background
Match with UN list – IS IT BEING DONE IN SCBs/DCCBs/RRBs??
Customer has been the subject of a law enforcement inquiry
Customer who conducts transactions in a pattern consistent with criminal
proceeds
Lottery scam or recruitment scam
Multi-level marketing
Transaction from high risk or sensitive area
Unusual or complex transaction
Transaction is unnecessarily complex
Unusual single or aggregate transfers
Transaction is inconsistent with customer profile
Routing of transfer through multiple locations or accounts or unexplained
transfers between accounts
“U-Turn” Transactions
Structuring - transactions split to evade reporting
Unexplained activity in dormant accounts
Suspicious use of ATM card
Doubtful source of payment for credit card purchases
No economic rationale or bonafide purpose::
Volume or frequency of transactions has no economic rationale
Use of agents or associates to disguise the beneficial owner
Common Unique IDs used by multiple customers
Common address/telephone used by multiple unrelated customers
Multiple cash transactions in a single day
Transactions with countries known for secret banking practices
Transactions inconsistent with customer’s profile
Maintaining multiple accounts without explanation
Unexplained cash deposits in bank account
Frequent cash transactions just under the reporting threshold
Multiple cash transactions in multiple accounts
Cash deposits followed by issue of instruments
Suspicious cash withdrawals from bank account
High value cheque deposits followed by immediate cash withdrawals
Non Financial Indicators::
Usage of Lockers
Behavioral Indicators:::
Customer is hurried, nervous or evasive
Customer has no or little knowledge about transaction
Customer is accompanied by unrelated individuals.
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Reluctance to meet in person, representing through power of attorney
Customer aborts transaction after being informed that identification
information will be required
Reluctance to provide original ID
Customer makes inquiries or tries to convince staff to avoid reporting
Providing different identifications or details (such as phone or address) on
different occasions in an attempt to avoid linking of transaction.
Knowledge Indicators::
Customer tries to convince staff not to complete the formalities
Customer thoroughly aware of legal position on suspicious transaction
reporting.
Customer seems very conversant with money laundering or terrorist activity
financing issues.
Customer is quick to volunteer that funds are clean or not being laundered.
Identity indicators
Customer doubtful or vague information given.
Customer gives false identification or identification that appears to be
counterfeited, altered or inaccurate.
Instead of his own some other identification is submitted by Customer.
All Identity documents presented are not verifiable i.e. Foreign documents
etc.
All identification documents appear to be recently acquired.
Identity matches with known ‘hot/watch lists’
Transactions indicators::
Frequent cash transactions in large amounts which is not normally done by
the customer.
Small denominations frequently changed for large ones.
Dirty/smelly notes deposited.
Customer consistently makes cash transactions that are just under the
reporting threshold amount in an apparent attempt to avoid the reporting
threshold .
Frequent purchase of travellers cheques, DDs, etc. with cash when this
appears to be outside of normal activity for the client.
32
Accounts Indicators::
A long distance customer opening an account/s.
Account/s opened with names closer to established industrial houses/
groups.
Intra bank transfer of funds - accumulated into one account for foreign
remittance.
Opening of several accounts simultaneously, some of which remain dormant
for long periods.
A third party appears to be using the account of customer.
Customer frequently using different locations other than the place of account
opening to deposit funds.
Activity in account
Account activity inconsistent with nature of business.
Transaction involves NGOs or charitable organization for which there appears
to be no logical economic purpose or where there appears to be no link
between the stated activity of the NGO or charitable organization and the
other parties in the transaction.
Transaction is unnecessarily complex.
Suspicion of proceeds of crime
Match of customer details with known criminals or persons with suspicious
background
Match with UN list – IS IT BEING DONE IN SCBs/DCCBs/RRBs??
Customer has been the subject of a law enforcement inquiry
Customer who conducts transactions in a pattern consistent with criminal
proceeds
Lottery scam or recruitment scam
Multi-level marketing
Transaction from high risk or sensitive area
Unusual or complex transaction
Transaction is unnecessarily complex
Unusual single or aggregate transfers
Transaction is inconsistent with customer profile
Routing of transfer through multiple locations or accounts or unexplained
transfers between accounts
“U-Turn” Transactions
Structuring - transactions split to evade reporting
Unexplained activity in dormant accounts
Suspicious use of ATM card
Doubtful source of payment for credit card purchases
No economic rationale or bonafide purpose::
Volume or frequency of transactions has no economic rationale
Use of agents or associates to disguise the beneficial owner
Common Unique IDs used by multiple customers
Common address/telephone used by multiple unrelated customers
Multiple cash transactions in a single day
Transactions with countries known for secret banking practices
Transactions inconsistent with customer’s profile
Maintaining multiple accounts without explanation
Unexplained cash deposits in bank account
Frequent cash transactions just under the reporting threshold
Multiple cash transactions in multiple accounts
Cash deposits followed by issue of instruments
Suspicious cash withdrawals from bank account
High value cheque deposits followed by immediate cash withdrawals
Non Financial Indicators::
Usage of Lockers
Behavioral Indicators:::
Customer is hurried, nervous or evasive
Customer has no or little knowledge about transaction
Customer is accompanied by unrelated individuals.
31
Reluctance to meet in person, representing through power of attorney
Customer aborts transaction after being informed that identification
information will be required
Reluctance to provide original ID
Customer makes inquiries or tries to convince staff to avoid reporting
Providing different identifications or details (such as phone or address) on
different occasions in an attempt to avoid linking of transaction.
Knowledge Indicators::
Customer tries to convince staff not to complete the formalities
Customer thoroughly aware of legal position on suspicious transaction
reporting.
Customer seems very conversant with money laundering or terrorist activity
financing issues.
Customer is quick to volunteer that funds are clean or not being laundered.
Identity indicators
Customer doubtful or vague information given.
Customer gives false identification or identification that appears to be
counterfeited, altered or inaccurate.
Instead of his own some other identification is submitted by Customer.
All Identity documents presented are not verifiable i.e. Foreign documents
etc.
All identification documents appear to be recently acquired.
Identity matches with known ‘hot/watch lists’
Transactions indicators::
Frequent cash transactions in large amounts which is not normally done by
the customer.
Small denominations frequently changed for large ones.
Dirty/smelly notes deposited.
Customer consistently makes cash transactions that are just under the
reporting threshold amount in an apparent attempt to avoid the reporting
threshold .
Frequent purchase of travellers cheques, DDs, etc. with cash when this
appears to be outside of normal activity for the client.
32
Accounts Indicators::
A long distance customer opening an account/s.
Account/s opened with names closer to established industrial houses/
groups.
Intra bank transfer of funds - accumulated into one account for foreign
remittance.
Opening of several accounts simultaneously, some of which remain dormant
for long periods.
A third party appears to be using the account of customer.
Customer frequently using different locations other than the place of account
opening to deposit funds.
Activity in account
Account activity inconsistent with nature of business.
Transaction involves NGOs or charitable organization for which there appears
to be no logical economic purpose or where there appears to be no link
between the stated activity of the NGO or charitable organization and the
other parties in the transaction.
Transaction is unnecessarily complex.
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