What is Money Laundering?

1. What is Money Laundering? The process of conversion of money earned through illegal/criminal means to make it appear as ‘Legitimate money’ is called ‘Money Laundering?

2. What is the offence of Money Laundering? Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or actually involved in any process or activity connected with the proceeds of crime and projected it as untainted property shall be guilty of offence of ‘money laundering’.

3. What is PMLA and what are its objectives? Prevention of Money Laundering Act. Objectives: To prevent Money Laundering activity To provide for confiscation of property, derived from or involved in ‘money laundering’.

4. What are the obligations of DOP ? The Department has to : a) Maintain a record of all transactions, the nature and value of which may be prscribed. b) Furnish such information to Enforcement Director within such time prescribed through Principal Compliance officer in Postal Directorate

5. What are the norms to be implemented? Know Your Customer (K Y C) Customer Due Diligence (C D D) (prevention of Money laundering and combating of financing in terrorism in small savings schemes)

6. Name the different risk categories defined under K Y C? Risk category Account opened/ certificate purchased with initial deposit Low Risk Below Rs.50,000 Medium Risk Rs.50,000 & 10,00,000 High Risk Above Rs.10,00,000

7. Name the documents that can be accepted as Identity proof under KYC? Identity proof : (any one of the following) Electoral Photo Id card/Ration card/Pass Port/Driving License/PO SB Id card/ Govt Id card (PPO, BPL, Job card)

8. Name the documents that can be accepted as Address Proof? Any one of the following: Electoral photo Identity card Bank or Post Office SB Pass Book Current Electricity bill or Telephone bill Certificate from any public authority

9. Name the norms for Low Risk category (relating to A/c opening) Photograph Id Proof Address Proof (PAN not mandatory)

10. What are the norms prescribed for Medium Risk? (A/c opening) Photograph Id proof (Mandatory : PAN or declaration in form 60/61) Address proof

11. Norms prescribed for High Risk Category (relating to a/c opening?) Photograph Id Proof (PAN or declaration in form 60/61) Address Proof Additional requirement : copy of source of funds and physical verification of address before opening the account or purchase of certificates

12. If NSCs are purchased in the name of minor, to whom norms are applicable? Norms are applicable to Guardian

13. Method of monitoring in the case of cash transaction involving more than Rs.10,00,000 ?(A/c opening) ? Prepare List & send to Head of Division by the 3rd of the following month. Head of the division to Circle by 5th Head of the Circle to the Principal officer at Directorate by 8th

14. Method of monitoring in the case of suspected transaction(relating to opening of a/c or purchase of NSC)? PO to prepare list and send to head of the division on next working day. Head of the division to Circle on next day of the receipt from PO. Head of the Circle to the Principal officer at Directorate by next day of the receipt from Circle.

15. Name the different Risk categories relating to remittances (Domestic/International) Risk category Limit Low Risk up to the value of Rs.5000 Medium risk above 5,000 up to 50,000 High Risk > 50,000 & up to 10 Lakhs Very High Risk > 10 Lakhs

16. What is the penalty for non-implementation of AML or CFT norms? Penalty of Rs.10,000 to 1,00,000 In addition, disciplinary action