Bribery and corruption proceeds

Automated and manual transaction monitoring shall identify unusual or suspicious activity using risk-based scenarios and thresholds.

Higher-risk customers (PEPs, foreign correspondents, private banking) require enhanced due diligence including additional information collection, source of funds/wealth, senior management approval, and enhanced ongoing monitoring (31 U.S.C. 5318(i), 31 CFR 1010.610, 1010.620).

Financial institutions may not keep anonymous accounts or accounts in obviously fictitious names and must, by a principle set out in law, undertake customer due diligence when establishing a business relationship, carrying out an occasional transaction above USD or EUR 15,000 or a payment or value transfer covered by INR.16, when money laundering or terrorist financing is suspected, or when they doubt previously obtained identification data: identify and verify the customer from reliable independent sources; identify the beneficial owner and take reasonable measures to verify that identity, understanding the ownership and control structure of legal persons and arrangements; understand and where appropriate obtain information on the purpose and intended nature of the relationship; and conduct ongoing due diligence and transaction scrutiny consistent with the customer's profile including, where necessary, the source of funds. The extent of each measure follows a risk-based approach; verification takes place before or during establishment of the relationship, or as soon as reasonably practicable after it where risks are managed and business would otherwise be interrupted; an institution that cannot complete CDD does not open the account or perform the transaction, or terminates the relationship, and considers a suspicious transaction report; the requirements apply to new customers and, on materiality and risk, to existing ones. The Interpretive Note sets the risk-based approach, enhanced and simplified measures, the specific measures for legal persons, arrangements and beneficiaries of life insurance, reliance on prior verification and the timing rules.

In relation to foreign PEPs as customers or beneficial owners, financial institutions, beyond normal CDD, have risk-management systems to determine whether a customer or beneficial owner is a PEP, obtain senior management approval to establish or continue the relationship, take reasonable measures to establish the source of wealth and source of funds, and conduct enhanced ongoing monitoring; they take reasonable measures to determine whether a customer or beneficial owner is a domestic PEP or a person entrusted with a prominent function by an international organisation and apply the same three measures where the relationship is higher risk; the requirements extend to family members and close associates; the Interpretive Note extends the measures to beneficiaries and beneficial owners of beneficiaries of life insurance policies.

Countries criminalise money laundering on the basis of the Vienna and Palermo Conventions and apply the offence to all serious offences so as to include the widest range of predicate offences; the Interpretive Note requires coverage of the designated categories of offences, extraterritorial predicates, the mental element inferable from objective circumstances, self-laundering where fundamental principles permit, ancillary offences and liability of legal persons with effective, proportionate and dissuasive sanctions.

Systems and controls for monitoring customer transactions for unusual or suspicious activity.