Anti-Money Laundering and Anti-Terrorism Financing Act 2001 (AMLATFA)

Question 1

Explain the history of AMLATFA

Answer 1

21st of January 2002, Anti-Money Laundering Act 2001 was created

A further amended include Anti-Terrorism Financing in December 2003

Question 2

What is the purpose of AMLATFA?

Answer 2

It imposes on a reporting institution an obligation to “promptly report to the competent authority any transaction:

1. exceeding such amount as the competent authority may specify
2. where the identity of the persons involved, the transaction itself, or any other circumstances concerning that transaction gives any officer or employee of the reporting institution reason to suspect that the transaction involves proceeds of unlawful activity”

Question 3

What is money laundering?

Answer 3

The proceeds of taking illegally earned funds appear legitimate instead of ill-gotten.

Question 4

What are the three steps of money laundering? Explain

Answer 4

Placement - placing “dirty” money from illegal activities to a registered bank account under a professional middleman

Layering - Using multiple bank transfers and transactions to further distance the main origins of illicit proceeds. This disguises the audit trail and provides anonymity

Integration - Integrating the laundered proceeds into the economy as “clean” money

Question 5

What are the money laundering prevention methods AMLATFA provides?

Answer 5

• suspicious transaction reporting
• record-keeping
• co-operate with domestic as well as foreign enforcement agencies
• investigation into money laundering activities
• freeze, seize and forfeit terrorist property and other property
• prohibition of falsification, concealment, and destruction of documents

Question 6

What is AML/CFT?

Answer 6

Anti-Money Laundering / Counter Financing Terrorism

Question 7

When and What was issued into the new guidelines of AML/CFT?

Answer 7

In September 2013, the regulator issued specific requirements on Customer Due Diligence (CDD) to enable reporting institutions to comply with their obligations.

CDD also requires business transactions made through agents and the insurer has to enforce on their agents the requirements.

Question 8

What is the required identification process in CDD?

Answer 8

a) full name
b) NRIC
c) residential and mailing address
d) DOB
e) nationality
f) occupation type
g) name of employer or nature of self-employment/nature of business
h) contact number
I) purpose of the transaction

Question 9

What is the required verification process in CDD?

Answer 9

Reporting institutions shall verify the documents referred to under:
a) by requiring the customer or beneficial owner to furnish the original document and make a copy