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Anti Money Laundering Handbook

Contents

A message from the Chief Executive

section 1	INTRODUCTION
	1.1	PURPOSE OF THIS HANDBOOK
	1.2	REGULATORY BACKDROP AND SANCTIONS FOR NON- COMPLIANCE
	1.3	BUSINESS CONDUCTED OUTSIDE THE ISLE OF MAN
	1.4	OUTSOURCING
	1.5	EQUIVALENCE STATUS OF JURISDICTIONS
	1.6	RISK BASED APPROACH

section 2	CORPORATE GOVERNANCE, VIGILANCE, SYSTEMS AND CONTROLS
	2.1	STATUTORY OBLIGATIONS
	2.2	THE APPOINTMENT OF A MONEY LAUNDERING REPORTING OFFICER ("MLRO")
	2.3	COMPLIANCE CULTURE AND THE COMPLIANCE FUNCTION, VIGILANCE AND ROBUSTNESS
	2.4	TAKING A RISK BASED APPROACH
	2.5	EXISTING CUSTOMERS
	2.6	ACQUISITION OF A BUSINESS OR A BLOCK OF CUSTOMERS
	2.7	EMPLOYEE SCREENING
	2.8	TECHNOLOGICAL DEVELOPMENTS
	2.9	COMPLIANCE MONITORING
	2.10	MANAGED LICENCEHOLDERS

section 3	KNOW YOUR CUSTOMER AND CUSTOMER DUE DILIGENCE
	3.1	INTRODUCTION
	3.2	A RISK-BASED APPROACH TO CDD
	3.3	COLLECTING RELATIONSHIP INFORMATION
	3.4	SOURCE OF FUNDS, INCOME AND WEALTH – TAKING A RISK BASED APPROACH (STAGES 1 AND 2)
	3.5	POLITICALLY EXPOSED PERSONS (“PEPS”)
	3.6	OTHER HIGH-RISK CUSTOMERS
	3.7	SHELL BANKS
	3.8	CORRESPONDENT BANKING SERVICES

section 4	IDENTIFICATION AND VERIFICATION OF IDENTITY
	4.1	INTRODUCTION
	4.2	OBLIGATION TO IDENTIFY AND VERIFY THE IDENTITY OF CUSTOMERS
	4.3	ONE-OFF TRANSACTIONS AND EXEMPTED ONE-OFF TRANSACTIONS
	4.4	IDENTIFICATION AND VERIFICATION OF IDENTITY REQUIREMENTS
	4.5	IDENTIFICATION AND VERIFICATION OF INDIVIDUALS NON-FACE TO FACE
	4.6	IDENTIFICATION AND VERIFICATION OF TRUSTEES AND EXPRESS TRUSTS
	4.7	IDENTIFICATION AND VERIFICATION OF LEGAL PERSONS
	4.8	EMPLOYEE BENEFIT SCHEMES, SHARE OPTION PLANS OR PENSION SCHEMES
	4.9	IDENTIFICATION AND VERIFICATION OF IDENTITY OF REGULATED LICENCEHOLDERS (ACCEPTABLE APPLICANTS)
	4.10	SOURCE OF FUNDS AS EVIDENCE OF IDENTITY
	4.11	RELIANCE ON OTHER FINANCIAL SERVICES BUSINESES TO IDENTIFY AND VERIFY IDENTITY: “ELIGIBLY INTRODUCED” RELATIONSHIPS
	4.12	INTERMEDIARIES
	4.13	TIMING OF IDENTIFICATION AND VERIFICATION OF IDENTITY

section 5	ONGOING MONITORING OF BUSINESS RELATIONSHIPS AND RECOGNISING SUSPICIOUS TRANSACTIONS AND ACTIVITY
	5.1	THE REQUIREMENT FOR ON-GOING MONITORING
	5.2	MONITORING METHODS AND PROCEDURES
	5.3	WIRE TRANSFER TRANSACTIONS
	5.4	RECOGNISING AND EVALUATING SUSPICIOUS TRANSACTIONS AND ACTIVITY

section 6	REPORTING SUSPICIOUS TRANSACTIONS AND ACTIVITY
	6.1	GENERAL PRINCIPLES WHEN A SUSPICIOUS TRANSACTION OR ACTIVITY ARISES
	6.2	THE TIMING OF DISCLOSURES
	6.3	INTERNAL REPORTING PROCEDURES
	6.4	HANDLING SUSPICIONS IN RESPECT OF OUTSOURCED BACK OFFICE FUNCTIONS
	6.5	REPORTING DECLINED BUSINESS
	6.6	LIAISING WITH LAW ENFORCEMENT
	6.7	ACTIONS AFTER REPORTING
	6.8	AVOIDING COMMITTING A TIPPING OFF OFFENCE

section 7	VETTING, AWARENESS RAISING AND TRAINING OF EMPLOYEES
	7.1	THE NEED FOR VIGILANCE
	7.2	VETTING OF RELEVANT EMPLOYEES
	7.3	EMPLOYEE AWARENESS AND TRAINING
	7.4	MONITORING THE EFFECTIVENESS OF TRAINING

section 8	RECORD KEEPING
	8.1	IDENTITY AND CUSTOMER DUE DILIGENCE RECORDS
	8.2	TRANSACTION RECORDS
	8.3	RETENTION OF RECORDS AS REQUIRED BY A CONSTABLE
	8.4	RETENTION OF RECORDS AS REQUIRED BY A COMPETENT AUTHORITY
	8.5	TRAINING RECORDS
	8.6	ESTABLISHMENT OF REGISTERS
	8.7	FORMAT AND RETRIEVAL OF RECORDS

section 9	SECTOR SPECIFIC GUIDANCE

section 10

Appendices

Appendix A(a)	Criminal Justice (Money Laundering) Code 2008
Appendix A(b)	Criminal Justice (Money Laundering) (Amendment) Code 2009
Appendix B	Part 9 of the Financial Services Rule Book 2008
Appendix C	Consolidated List Of Jurisdictions Listed At Schedule 2 Of The Criminal Justice (Money Laundering) Code 2008 And Subsequent Amendments
Appendix D	Acceptable Applicants Certificate
Appendix E	Eligible Introducers Certificate
Appendix F	Financial Crime Unit Disclosure Form
Appendix G	Countries and territories covered by a statement from an international body
Appendix H(a)	European Communities (Wire Transfers Regulation) (Application) Order 2007
Appendix H(b)	European Communities (Wire Transfers Regulation) (Application) (Amendment) Order 2007
Appendix I	The EC Wire Transfers Regulation (Enforcement) Regulations 2007

NB Where the masculine gender is used it also implies the feminine.

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