ABC Remittance Corporation

ABC REMITTANCE CORPORATION
MONEY LAUNDERING AND TERRORIST

FINANCING PREVENTION PROGRAM (MLPP)
MAY 2016
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Revised MLPP - May 2016
ABC REMITTANCE CORPORATION

MONEY LAUNDERING AND TERRORIST FINANCING PREVENTION
PROGRAM
TABLE OF CONTENTS
I. Statement of Commitment
II.
Intent of the Manual ..
III.
Introduction ..
IV.
Principles and Policies to Combat Money Laundering
V.
Definition of Terms .
VI.
Choice of Remittance Agents and Partners ..10
VII.
Policy Guidelines and Procedures
10
VII.1 Client identification or Know Your Customer (KYC) .
10
VII.2 Record-Keeping
18
VII.3 Reporting of Covered/Suspicious Transaction
18
VII.4 Risk-Based Due Diligence in

Processing Remittance Instructions .
20
VIII.
Training Program.
25
IX.
Recruitment .
25
IX.
Internal Audit System 26
Independent Audit Program
27
XI.
Compliance Monitoring .
27
XII. Cooperation with Anti-Money Laundering Council ..
28
XIII. Designation of Compliance Officer ..
28
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THE ABC COMPLIANCE PROGRAM

I. STATEMENT OF COMMITMENT
The Compliance Program aims to strengthen the internal processes which identify and
minimize compliance risk within the company.
We are conscious of the compliance functions objective, which is to aid ABC Remittance
Corporation in handling its compliance risk. As defined, compliance risk is the risk of legal
or regulatory sanctions, financial loss, or reputation the company may suffer as a result of
its failure to comply with all applicable laws, regulations, and codes of conduct and
standards of good corporate governance. It is also known as integrity risk, given that ABC
Remittance Corporations reputation is dependent on its adherence to principles of
integrity and fair dealing.
Compliance risk covers the possibility for ABC Remittance Corporation to incur a financial
loss from changes in laws, monetary, tax or other government regulations of a country.
This risk is higher in heavily regulated areas and especially in unstable market conditions
where rules and regulations are frequently altered. It is a significant qualitative risk which
must be monitored properly as non-compliance may merit heavy sanctions, especially in
extreme cases, which can lead to a tainted reputation, monetary fines, and even a
revocation of license.
Compliance risk is brought about by non-compliance with laws, regulations or codes
applicable to the financial services industry. Among the consequences violators can face
are fines, public reprimands, enforced suspension of operations or in extreme cases,
withdrawal of authorization to operate.
From the standpoint of BSP, SEC, AMLC and other regulatory bodies, an effective
Compliance Program should be able to minimize the possibility of finding ABC Remittance
Corporation guilty of irresponsibly overlooking or intentionally violating banking laws, rules
and regulations.
Due to the complex nature of the regulatory environment, we at ABC Remittance
Corporation seek to foster a culture that promotes proactive compliance. We are aware of
our duty to follow the regulations based on a culture of accountability and transparency in
every endeavor that we undertake. We are committed to put in place the appropriate
processes to ensure a common understanding of, and compliance with, laws, rules and
regulations, through a continuing training and education program, and enhanced
monitoring and enforcement.
II. INTENT OF THE MANUAL

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The ABC Remittance Corporation holds the belief that money laundering undermines the
development of a strong Philippine economy and may be used as a ploy in facilitating
monetary transfers to fund terrorist activities. Hence, this manual was written to be in
compliance not only with applicable laws and regulations such as RA 9160, as
amended by RA 9194, otherwise known as the Anti-Money Laundering Act of 2001,
its Implementing Rules and Regulations and the Updated BSP circular 706 series of
2011, but also with internationally accepted Anti-Money Laundering standards.
This manual can serve as a reference for the officers and staff of ABC Remittance
Corporation, as well as to its remittance business agents and partners (tie-ups) in order to
guide them in performing their duties and responsibilities in servicing remittance
instructions. In particular, these are: proper customer identification or the Know Your
Client (KYC) process, diligence in processing remittance instructions, monitoring and
reporting of covered and suspicious transactions, and record-keeping.
III. INTRODUCTION
ABC Remittance Corporation provides a service that makes international money transfer
fast, convenient and affordable. By using its electronic remittance facilities and growing
network of bank and non-financial institutional partners worldwide, ABC aims to be the
preferred choice for international money remittances of Overseas Filipino Workers (OFW.)
Our Vision:
To be a leader in the remittance/fund transfer industry by providing quality services
that exceeds the expectations of our esteemed customers.
Our Mission:
To build long term relationships with our customers, clients & partners and provide
exceptional customer services by pursuing business through innovation and
advanced technology.
Core values
Proper customer treatment

Growth fuelled by creativity and innovation
Integration of business ethics in all company matters
Our Slogan
We provide the best .... for you!

Given this, the business model is a collaboration with legitimate, reputable and AMLA
compliant remittance companies, foreign banks and financial institutions.
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ABC exists in order to render effective and efficient services that adhere to the
requirements stipulated by the regulatory bodies.
The regulatory requirement as provided for in BSP Circular 706 series of 2011 is the
publication of a manual to prevent money laundering and the financing of terrorist
activities.
V.
PRINCIPLES AND POLICIES TO COMBAT MONEY LAUNDERING

STATE POLICY
It is hereby declared the policy of the State to protect the integrity and
confidentiality of bank accounts and to ensure that the Philippines shall not be
used as a money-laundering site for the proceeds of unlawful activity. Consistent
with its foreign policy, the Philippines shall extend cooperation in transnational
investigation and prosecutions of persons involved in money laundering activities
wherever committed (Sec. 2 RA 9194; Rule 2 IRR)
The ABC Remittance Corporation recognizes the effect of money laundering to the
economy and the dangers of it being used as a way to fund terrorist activities. It vows to
fully support all local and international campaigns and efforts to combat money laundering
and terrorist financing activities.
In line with this, the ABC Remittance Corporation vows to be committed in playing its role
in the fight against money laundering by conducting its remittance business within the
bounds of all applicable laws and regulations, by refraining to be associated with those
involved in unlawful/criminal activities, and by maintaining the highest operating standards
in the conduct of its business with due skill, care and diligence.
Thus, ABC Remittance Corporation hereby adopts the following policies to combat money
laundering activities.
1. A strictly implemented Customer Due Diligence policy to ensure that all customers
provide sufficient evidence of identity. This is written in the context of Republic Act
9160 as amended by Republic Act 9194 and put in place an effective procedure
for verifying the bona fides of customers and determining their source of funds.
2. Clear and concise polices that concern records retention and the protocol for
reporting suspicious activity.
3. Law abidance to ensure that all transactions are performed in conformity with high
ethical standards; that laws and regulations are adhered to.
The company reserves the right to deny rendering services in situations when there is
suspicion concerning customer involvement with money laundering activities.
4. Cooperation with governing bodies such as the Anti-Money Laundering Council
(AMLC) and the Bangko Sentral ng Pilipinas (Central Bank of the Philippines) within
the limits provided by law.
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5. Submission of a report to AMLC containing details on covered transactions and

suspicious transactions within five (5) working days from occurrence thereof, unless
the Supervising Authority concerned prescribes a longer period not exceeding ten
(10) working days (Sec. 6 of RA 9194 amending Sec 9 RA 9160)
VI. Definition of Terms Unless otherwise defined herein, all terms used shall have the same
meaning as those terms that are defined in the AMLA, as amended, and its RIRR.
(A) Money laundering is a crime whereby the proceeds of an unlawful activity as
herein defined are transacted, thereby, making them appear to have originated
from legitimate sources. It is committed by the following:
1. Any person knowing that any monetary instrument or property
represents, involves, or relates to, the proceeds of any unlawful activity,
transacts or attempts to transact said monetary instrument or property.
2. Any person knowing that any monetary instrument or property involves
the proceeds of any unlawful activity, performs or fails to perform any act as
a result of which he facilitates the offense of money laundering referred to
in paragraph (1) above.
3. Any person knowing that any monetary instrument or property is required
under the act to be disclosed and filed with the Anti-Money Laundering
Council, fails to do so.
(B) Covered transaction (CT) is a transaction involving cash or other equivalent
monetary instrument involving a total amount in excess of five hundred
thousand pesos (P500,000) within one banking day.
(C) Suspicious transactions (ST) are transactions with covered institutions,
regardless of the amount involved, where any of the following circumstances
exist:
1. There is no underlying legal or trade obligation, purpose or economic
justification;
2. The client is not properly identified;
3. The amount involved is not commensurate with the business or financial
capacity of the client;
4. Taking into account all known circumstances, it may be perceived that the
clients transaction is structured in order to avoid being the subject of
reporting requirements under the AMLA, as amended;
5. Any circumstance relating to the transaction which is observed to deviate
from the profile of the client and/or clients past transactions with the
covered institution;
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6. The transaction is in any way related to an unlawful activity or any money

laundering activity or offense under AMLA, as amended, that is about to
be, is being or has been committed; or
7. Any transaction that is similar or analogous to any of the foregoing.
(D) Monetary instrument refers to:
1. Coins or currency of legal tender of the Philippines, or of any
country;
other
2. Drafts, check, and notes;

3. Securities or negotiable instruments, bonds, commercial papers, deposit
certificates, trust certificates, custodial receipts or deposit substitute
instruments, trading orders, transaction tickets and confirmations of sale or
investments and money market instruments;
4. Contracts or policies of insurance, life or non-life, and contracts of
suretyship; and
5. Other similar instruments where title thereto passes to another by
endorsement assignment or delivery.
(E) Transaction refers to any act establishing any right or obligation or giving rise
to any contractual or legal relationship between the parties thereto. It also
includes any movement of funds by any means with a covered institution.
(F) Unlawful activity refers to any act or omission or series or combination thereof
involving or having direct relation to the following:
1. Kidnapping for ransom under Article 267 of Act No. 3815, otherwise known
as the Revised Penal Code, as amended;
2. Section 4, 5, 6, 8, 9, 10, 12, 13, 14, 15, and 16 of Republic Act No. 9165,
otherwise known as the Comprehensive Dangerous Drugs Act of 2002;
3. Section 3 paragraphs B, C, E, G, H, and I of Republic Act No. 3019, as
amended; otherwise known as the Anti-Graft and Corrupt Practices Act;
4. Plunder under Republic Act No. 7080, as amended;
5. Robbery and extortion under Articles 294, 295, 296, 299, 300, 301, and
302 of the Revised Penal Code, as amended;
6. Jueteng and masiao punished as illegal gambling under Presidential
Decree No. 1602;
7. Piracy on the high seas under Revised Penal Code, as amended and
Presidential Decree No. 532;
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8. Qualified theft under Article 310 of Revised Penal Code, as amended;

9. Swindling under Article 310 of the Revised Penal Code, as amended;
10. Smuggling under Republic Act Nos. 455 and 1937;
11. Violations under Republic Act No. 8792, otherwise known as the
Electronic Commerce Act of 2000;
12. Hijacking and other violations under Republic Act No. 6235; destructive
arson and murder, as defined under the Revised Penal Code, as
amended, including those perpetrated by terrorists against noncombatant persons and similar targets;
13. Fraudulent practices and other violations under Republic Act No. 8799,
otherwise known as the Securities Regulation Code of 2000;
14. Felonies or offenses of a similar nature that are punishable under the
penal laws of other countries.
(G) Compliance Monitoring Officer The person in-charge in the Company
responsible for ensuring compliance of all personnel and staff to applicable
laws and regulations of various regulatory bodies, including that of the AntiMoney Laundering Council.
(H) Customer - refers to any person or entity that keeps account, or otherwise
transacts business with a covered institution and any person or entity on whose
behalf an account is maintained or a transaction is conducted, as well as the
beneficiary of said transactions. A customer also includes the beneficiary of a
trust, an investment fund, a pension fund or a company or person whose assets
are managed by an asset manager, or a grantor of a trust.
(I) Shell Company a Legal entity that has no substance in doing business but
being used as financial intermediary that financial transactions may be
conducted.
(J) Shell Bank - a Shell company incorporated as a bank or made to appear to be
incorporated as a bank but has no physical presence and no affiliation with a
regulated financial group. It can also be a bank that (a) does not conduct
business at a fixed address in a jurisdiction in which the shell bank is
authorized to engage; (b) does not employ one or more individuals on a full
time basis at this fixed address; (c) does not maintain operating records at this
address, and (d) is not subject to inspection by the authority that licensed it to
conduct banking activities.
(K) Beneficial Owner - refers to natural person(s) who ultimately owns or controls
a customer and/or the person on whose behalf a transaction is being
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conducted. It also incorporates those persons who exercise ultimate effective

control over a legal person or arrangement.
(L) Politically Exposed Person or PEP - an individual who is or has been
entrusted with prominent public positions in the Philippines or in a foreign state,
including heads of state or of government, senior politicians, senior national or
local government, judicial or military officials, senior executives of government
or state owned or controlled corporations and important political party officials.
(M)
Correspondent banking refers to activities of one bank (the correspondent

bank) having direct connection or friendly service relations with another bank
(the respondent bank).
(N) Fund/wire transfer - refers to any transaction carried out on behalf of an

originator (both natural and juridical) through a financial institution (Originating
Institution) by electronic means with a view to making an amount of money
available to a beneficiary at another financial institution (Beneficiary Institution).
The originator person and the beneficiary person may be the same person.
(O)Cross border transfer - any wire transfer where the originating and beneficiary
institutions are located in different countries. It shall also refer to any chain of
wire transfers that has at least one cross-border element.
(P) Domestic Transfer - any wire transfer where the originating and beneficiary
institutions are located in the same country. It shall refer to any chain of wire
transfers that takes place entirely within the borders of a single country, even
though the system used to effect the fund/wire transfer may be located in
another country.
(Q)Originating institution - refers to the entity utilized by the originator to transfer
funds to the beneficiary and can either be (a) a covered institution as
specifically defined by these Rules and as generally defined by the AMLA, as
amended, and its RIRR, or (b) a financial institution operating outside the
Philippines that is other than covered institutions referred to in (a) but conducts
business operation and activities similar to them
(R) Beneficiary institution - refers to the entity that will pay out the money to the
beneficiary and can either be (a) a covered institution as specifically defined by
these Rules and as generally defined by the AMLA, as amended, and its RIRR,
or (b) a financial institution operating outside the Philippines that is other than
covered institutions referred to in (a) but conducts business operations and
activities similar to them.
(S) Intermediary institution - refers to the entity utilized by the originating and
beneficiary institutions where both have no correspondent banking relationship
with the intermediary institution. It can either be (a) a covered institution as
specifically defined by these Rules and as generally defined by the AMLA, as
amended, and its RIRR, or (b) a financial institution operating outside the
Philippines that is other than covered institution referred to in (a) but conducts
business operations and activities similar to them.
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(T) Remittance Partner (Tie-up) an entity with whom ABC Remittance

Corporation has a business agreement for processing remittance transactions.
A remittance partner based abroad and who will accept remittance transactions
is called either an Agent or a Subsidiary/Affiliate, while remittance partners
based here in the Philippines and who will be used as a channel for distribution
of the remittance to its final beneficiary is called a Fulfillment partner or a
Courier or an Outlet.
VII.
VIII.
Choice of Remittance Agent and Partner

1.
To ensure that it deals only with legitimate entities, ABC Remittance

Corporation shall identify prospective business agents and partners from
among the known and reputable entities in the remittance business, including
reputable foreign correspondent banks, and are known to be regulated/subject
to anti-money laundering and combating terrorist financing laws and
regulations.
2.
Relationship with the preferred business tie-up (agent and fulfillment partner)
shall be established with the signing of a Memorandum of Agreement (MOA).
3.
Local business tie-ups (i.e. fulfillment partners, couriers, outlets) shall be

subjected to background checking. A due diligence on the partners Anti
Money Laundering program shall be conducted to ensure that they are
compliant to BSP requirements. The same should have undergone the AntiMoney Laundering Seminar conducted by the Bangko Sentral ng Pilipinas
(BSP).
POLICY GUIDELINES
VII.1 Customer Identification or Know Your Customer (KYC) Process
A KYC policy ensures that ABC Remittance Corporation is in compliance with
all laws and regulations. It also makes sure that ABC Remittance Corporation
engages in good business practice that will uphold the companys reputation.
Thus, a KYC policy should lessen the possibility of ABC becoming a victim of
illegal activities perpetrated by fraudulent people.
KYC will be best implemented before the relationship with the customer
begins. ABC, its agents, subsidiaries/affiliate, tie-ups, fulfillment partners,
couriers and outlets are enjoined to observe proper identification of clients.
The ABC Anti-Money Laundering Questionnaire (Annex A) must be filled-up.
Moreover, if a remitter opens an account at the agent/subsidiary/affiliate
abroad, it will be the responsibility of the agent/subsidiary/affiliate to establish
and record the identity of the remitter. ABC then takes in this information
through its system and from the exchange file instructions.
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Agents/subsidiaries/affiliates shall ensure that all necessary information,

pertaining to KYC, of the client/customer/remitter shall be properly
documented and included in the exchange file, and that these documents
presented are thoroughly inspected.
VII.1.1 General Information/Documents Required
a. ABC shall obtain satisfactory evidence of the true and full identity,
representative capacity, domicile, legal capacity, occupation or business
purposes of clients, as well as other identifying information on those
clients, whether they be occasional or usual, through the use of
documents such as, but not limited to:
i.
Identification documents, such as passports, birth certificates,

drivers licenses, employment identification cards, and other similar
identity documents, which are verifiable from the institution issuing
the same; The identifying documents should provide evidence of
true name or names used, permanent address, date of birth,
nationality, and office address. They should include at least one
bearing a photograph and be pre-signed. The identifying documents,
which are considered most reliable, are official identity cards and
passports issued by the government. While identification documents
that are easily obtained in any name, e.g., medical cards, credit
cards and student identification cards may be used, they should not
be accepted as the sole means of identification.
ii.
Incorporation and partnership papers, for corporate accounts.

These documents should be certified as true copies from the issuing
government agency.
iii.
Duly notarized special authorizations for representatives.
iv.
Other pertinent and reasonable documents as may be deemed

necessary under the prevailing circumstances
b. Where applicable, Clients should be notified of ABC explicit policy which

states that transactions will not be conducted with applicants who fail to
provide identification, but without detracting from the ABC obligations to
report suspicious transactions. In cases when initial checks fail to identify
the applicant, or give rise to suspicions that the information provided is
false, additional verification measures should be undertaken to
determine whether the transaction will proceed. Details of the additional
checks are to be recorded.
c. Upon ABCS acquisition of another financial sector company or covered
institution, either in whole or as a product portfolio, it is not necessary for
the identity of all existing customers to be re-identified, provided that:
i. all customer account records are acquired with the business; and
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ii. due diligence inquiries are not questionable as to whether the antimoney laundering procedures previously adopted by the acquired
business have satisfied Philippine requirements.
iii If during the business relationship, ABC has reason to doubt:
a. the accuracy of the information relating to the customer's identity;
b. that the customer is the beneficial owner; or the intermediary's
declaration of beneficial ownership, or
c. if there are any signs of unreported changes,
ABC shall take further measures to verify the identity of the customer or
the beneficial owner, as applicable. Such measures may include the
following:
a. referral of names and other identifying information to criminal
investigating authorities
b. review of disciplinary history and disclosure of past relevant
sanctions.
d. Where applicable, ABC Customer Identification Program must include
procedures for responding to circumstances in which the identity of a
customer cannot be established by ABC. These procedures should
describe, among others, the following:
1. When ABC should not open an account;
2. The terms under which a customer may conduct transactions
while ABC attempts to verify the customers identity;
3. When ABC should close an account after attempts to verify the
customers identity fails;
4. When ABC should file a Suspicious Transaction Report.
VII.1.2 Individual Clients/Customers Documentary Requirements
a.
As stated in BSP Circular 706 Series of 2011, governing the acceptance

of valid ID cards for all types of financial transaction by a customer and
the authorized signatory/ies of a corporate or juridical entity, including
financial transactions involving Overseas Filipino Workers (OFWs). This
is to promote access to services offered by formal financial institutions,
particularly those residing in remote areas, as well as to encourage and
facilitate remittances of OFWs through the banking system:
(1) Customers and the authorized signatory/ies of a corporate or
juridical entity who engage in a financial transaction with ABC
Remittance Corporation for the first time must present the original and
submit a clear copy of at least one (1) valid photo-bearing ID document
issued by an official authority.
For this purpose, the term official authority shall refer to any of the
following:
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a. Government of the Republic of the Philippines;

b. Its political subdivisions and instrumentalities;
c. GOCCs; and
d. Private entities or institutions registered with or supervised or
regulated either by the BSP, SEC or IC.
Valid Ids include the following:
1. Passport including those issued by foreign governments
2. Drivers license
3. PRC ID
4. NBI clearance
5. Police clearance
6. Postal ID
7. Voters ID
8. Tax Identification Number
9. Barangay certification
10. GSIS e-Card
11. SSS card
12. Senior Citizen card
13. OWWA ID
14. OFW ID
15. Seamans book
16. Alien Certification
Registration
of
Registration/Immigrant
Certificate
of
17. Government office and GOCC ID (e.g., AFP, HDMF IDs)

18. Certification from the NCWDP
19. DSWD certification
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20. IBP ID; and

21. Company IDs issued by private entities or institutions registered
with or supervised or regulated either by the BSP, SEC or IC.
(2) Beneficiaries of remittances/fund transfers under the age of eighteen
may be allowed to present the original and submit a clear copy of one
(1) valid photo-bearing school ID duly signed by the school principal.
(3) For foreign residents, similar IDs duly issued by the foreign
government where the customer is a resident or a citizen may be
presented.
(4) ABC shall require their customers or authorized signatory to submit
a clear copy of one (1) valid ID in order to consummate the business
relationship. Clients are also required to submit updated photos and
other relevant information on the basis of risk and materiality.
(5) ABC may classify identification documents based on its reliability
and ability to validate the information indicated in the identification
document with that provided by the customer.
(6) For special cases, ABC may accept other IDs not enumerated above
provided that it shall not be the sole means of identification.
(7) ABC reserves the right to use its own technology to take the
customers photo if the identification documents presented above, or
those deemed acceptable by the company, does not bear a clear photo
of the customer.
VII.1.3 Corporate and Juridical Entities Documentary Requirements.
a. Due diligence requires that ABC Remittance Corporation shall obtain the
following minimum information and/or documents before establishing
business relationships:
1. Certificates of Registration issued by the Department of Trade and
Industry for single proprietors, or by the Securities and Exchange
Commission, for corporations and partnerships, and by the BSP, for
money chargers/foreign exchange dealers and remittance agents;
2. Articles of Incorporation or Association and By-Laws;
3. Principal business address;
4.
Board or Partners Resolution duly certified by the

Corporate/Partners Secretary authorizing the signatory to sign on
behalf of the entity;
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5. Latest General Information Sheet which lists the names of

directors/trustees/partners, principal stockholders owning at least
twenty percent (20%) of the outstanding capital stock and primary
officers such as the President and Treasurer;
6. Contact numbers of the entity and authorized signatory/ies;
7. Source of funds and nature of business;
8. Name, present address, date and place of birth, nature of work and
source of funds of beneficial owner or beneficiary, if applicable; and
9. For entities registered outside the Philippines, similar documents
and/or information shall be obtained duly authenticated by the
Philippine Consulate where said entities are registered.
VII.1.4 Politically Exposed Person (PEPs) The company shall establish

and record the true and full identity of PEPs as well as their immediate
family members and the entities related to them and conduct enhanced
due diligence to them taking into consideration their position and the
risks attendant thereto.
VII.1.5 Correspondent Banking - Because of the risk associated with dealing
with correspondent accounts where it may unknowingly facilitate the
transmission, or holding and management of proceeds of unlawful
activities or funds intended to finance terrorist activities, ABC shall
conduct enhanced due diligence. ABC may rely on the customer
identification process undertaken by the respondent bank. In such
case, it shall apply the rules on Third Party reliance treating the
respondent bank as the Third Party as defined therein. In addition, the
correspondent bank shall:
(a) Gather sufficient information about the respondent institution to
understand fully the nature of the respondents business and to
determine from publicly available information the reputation of the
institution and the quality of supervision, including whether it has been
subject to money laundering or terrorist financing investigation or
regulatory action.
(b) Assess the respondent institutions anti-money laundering and
terrorist financing controls.
(c) Obtain approval from senior management before establishing
correspondent relationships.
(d) Document the respective responsibilities of each institution.
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(e) With respect to "payable-through accounts", be satisfied that the

respondent bank has verified the identity of, and performed on-going
due diligence on, the customers having direct access accounts of the
correspondent and that it is able to provide relevant customer
identification data upon request by the correspondent bank.
VII.1.6 Fund/Wire Transfer - ABC shall prevent from being utilized
unknowingly in transmitting proceeds of unlawful activities or funds
intended to finance terrorist activities because of the risk associated
with dealing with fund/wire transfers. Thus, ABC shall take the following
necessary measures:
(a) ABC shall not accept instructions to pay-out fund transfers to noncustomer beneficiary, unless it has gone through the process of
conducting necessary procedures needed to establish the true and full
identity and existence of said beneficiary. Should the originator and
beneficiary be the same person, ABC may rely on the customer due
diligence conducted by the originating institution provided the rules on
Third Party reliance are met, treating the originating institution as Third
Party as therein defined;
(b) The originating institution shall not accept instructions to fund/wire
transfer from a non-customer originator, unless it has conducted the
necessary customer due diligence to establish the true and full identity
and existence of said originator;
(c) In cross border transfers, ABC shall conduct enhanced due diligence
on the beneficiary and the originator if he/she is a high risk customer. In
cases when additional information cannot be obtained, or any
information or document provided is false or falsified, or result of the
validation process is unsatisfactory, ABC shall refuse to effect the
fund/wire transfer or the pay-out of funds without prejudice to the
reporting of a suspicious transaction to the AMLC when circumstances
warrant;
(d) Whenever possible, manually initiated fund transfer (MIFT)
instructions should not be the primary delivery method; electronic
solutions are preferred for clients. However, where MIFT is utilized, the
existing rules on validation procedures as prescribed by Circular No.
436 dated 18 June 2004 shall apply;
(e) Cross border and domestic fund/wire transfers and related message
amounting to P50,000 or more or its equivalent shall include accurate
information from its originator. The following are the originator
information that shall remain with the transfer or related message
through the payment chain:
1. Name of the originator;
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2. Address. If none, absence the national identity number or date

and place of birth of the originator; and
3. Account number of the originator. If none, a unique reference
number must be included.
(f) Should any wire transfer amounting to P500,000 or more or its
equivalent be unaccompanied by the required originator information, the
ABC shall exert all efforts to establish the true and full identity and
existence of the originator by requiring additional information from the
originating institution or intermediary institution. It shall likewise apply
enhanced due diligence to establish the true and full identity and
existence of the beneficiary. In cases when additional information
cannot be obtained, or any information or document provided is false or
falsified, or result of the validation process is unsatisfactory, the
beneficiary institution shall refuse to effect the fund/wire transfer or the
pay-out of funds without prejudice to the reporting of a suspicious
transaction to the AMLC when circumstances warrant.
VII.1.7 FX dealers/Money changers/ Remittance agents ABC shall require
their customers who are foreign exchange dealers, money changers
and remittance agents to submit a copy of the certificate of registration
issued to them by the BSP as part of their customer identification
document. The certificate of registration shall be for each head office,
branch, agent, sub-agent, extension office or business outlet of foreign
exchange dealers, money changers and remittance agents.
VII.1.8 Shell company/ Shell bank Shell banks will not be permitted to
operate or be established in the Philippines because of its dubious
nature. ABC reserves the right to refuse to establish a banking
relationship with them, as well as with foreign financial institutions that
permit their accounts to be used by shell banks.
VII.2 Record-Keeping
1. Where applicable, ABC shall prepare and maintain documentation on their
customer relationships and transactions such that:
a. requirements of the Act are fully met;
b. any transactions done via ABC can be reconstructed and from which the
Council will be able to compile an audit trail for suspected money
laundering, when such a report is made to it;
c. ABC can satisfy within a reasonable time any inquiry or order from the
Council as to disclosure of information, including without limitation
whether a particular person is the customer or beneficial owner of
transactions conducted through the ABC.
2. The following document retention periods shall be followed:
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17
a. All records of remittance transactions (i.e. remittance instructions from

agents/subsidiaries, transmittal to fulfillment partners, proof of receipts,
billings, etc.) shall be maintained and safely stored by ABC for five (5)
years from date of transaction.
b. If a money laundering case based on any record kept by ABC has been
filed in court, said file must be retained beyond the stipulated period until
it is confirmed that the case has been settled in court.
c. ABC shall keep the records as originally obtained in order for them to
remain admissible in court. ABC shall ensure that these records are filed
separately, labeled properly, boxed and stored safely.
d. As provided for by the Anti-Money Laundering Law, violators will face a
penalty of imprisonment from 6 months to 1 year or a fine of not less than
P100K, but not more than P500K, both consequences.
3. Transaction documents may be retained as original or duplicate copies on
microfilm or in soft copy, provided that these will be admissible in court,
pursuant to the Revised Rules of Court and the E-Commerce Act and its
Implementing Guidelines.
4. If the records relate to on-going investigations or transactions that have been
the subject of a disclosure, they shall be retained beyond the stipulated
retention period until it is confirmed that the case has been closed and
terminated
5. Where applicable, ABC shall designate at least two (2) persons responsible in
the safekeeping of all records, reporting to the Commission/Council any
change in the person/s responsible, if there is any.
VII.3 Reporting of Covered & Suspicious Transactions
1. It is within ABCs responsibility to report all covered and suspicious remittance
transactions to the Compliance Monitoring Officer. ABC incorporates
automated AML, OFAC and KYC controls and reporting functionalities within
its system.
2. The report shall be submitted within ten (10) days from occurrence thereof,
unless the Supervising Authority (BSP, SEC, IC etc.) concerned prescribes a
longer period not exceeding 10 working days. This shall be prepared in the
prescribed format and forms and shall be submitted/transmitted in a secured
manner as prescribed in the AMLC Reporting Procedures document.
3. Where applicable, the mandatory Covered Transaction Report (CTR), shall be
filed before the Anti-Money Laundering Council, copy furnished the SEC, for
transactions in cash or other equivalent monetary instrument involving a total
amount in excess of the threshold limit of P500,000.00 within one (1) banking
day as provided under Section 3 (b) of R.A. 9160, ABC shall clarify the
economic background and purpose of any transaction or business
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18
relationship if its form or amount appears unusual in relation to the business

or financial capacity of the customer and the customer has not been properly
identified, or if the economic purpose or legality of the transaction is not
immediately clear, as where there is no underlying legal, trade obligation,
purpose, origin or economic justification, or where the transaction is unusually
large and complex.
4. Where the transaction or transactions do not fall within the threshold amount
provided in the definition of a covered transaction, and ABC has reasonable
grounds to believe that the source/s of the funds arise from or are in anyway
related to an unlawful activity, ABC shall file a Suspicious Transaction Report
before the Anti-Money Laundering Council, copy furnished the SEC. In this
regard, ABC should exercise due diligence by implementing adequate
systems for identifying and detecting suspicious transactions, especially
where any of the following circumstances exists:
a. there is no justifying legal or trade obligation, purpose or economic
justification;
b. the client is not properly identified;
c. the amount involved is not commensurate with the business or financial
capacity of the client;
d. taking into account all known circumstances, it may be perceived that
the clients transaction is structured in order to avoid being the subject
of reporting requirements under the Act;
e. any circumstance relating to the transaction which is observed to
deviate from the profile of the client and/or the clients past transactions
with the covered institution;
f.
the transaction is in any way related to an unlawful activity or offense
under this Act that is about to be, is being or has been committed; or
g. any transaction that is similar or analogous to the foregoing.
In this regard, ABC shall exercise due diligence by implementing adequate
systems for identifying and detecting suspicious transactions.
5. The suspicion relates to a transaction considering all the circumstances of the
transaction. As a general principle, any transaction which causes ABC to have
a feeling of apprehension or mistrust about the transaction considering
a. its unusual nature or circumstances or,
b. the person or group of persons with whom they are dealing, and based
on the bringing together of all relevant factors including knowledge of
the person's or persons' business or background (as well as behavioral
factors) should be reported as a suspect transaction.
6. Suspect transactions are likely to involve a number of factors, which together
raise a suspicion in the mind of ABC that the transaction may be connected
with any unlawful activity.
VII.4 Risk-Based Due Diligence in Processing Remittance Instructions
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19
1. ABC
only
accepts
remittance
instructions
from
subsidiaries/affiliates, tie-ups, and correspondent banks.
its
agents,
2. Agents/subsidiaries/affiliates must ensure that remitters declare the purpose

of the remittance transaction as well as its source. The declaration should
be validated through the identification papers presented. Assessments will
me made whether the remittance amount is commensurate to the nature of
job/business of the remitter.
3. The fulfillment partners, accredited couriers and outlets should also pursue
their own verification initiatives on establishing the identity of the beneficiary,
source of funds, and purpose of the remittance.
4. ABC accredited agents, subsidiaries/affiliates, tie-ups, fulfillment partners,
couriers, outlets shall use any or combination of the following to verify the
identity of the sender of an emailed or faxed message as well as verify its
authenticity, and ensure the integrity and authenticity of the exchange file.
i. Test Key - An algorithmic computation using a fixed set of factors known
only to the subsidiary/tie-up to authenticate the remittance instructions.
Note : ABC shall provide its remittance partners a unique set of codes for its use in its incoming
and outgoing remittance transactions.
ii. ABC will use the service of a secured FTP server to ensure security,
efficiency and speed in the delivery of the exchange file.
Note: ABC shall provide its remittance partners a unique set of login credentials.
iii. Designation of responsible personnel ABC shall require its remittance

partners to provide them with a list containing the names of their
personnel authorized to transact/communicate with ABC, and likewise
designate specific persons with whom they can transact/communicate.
iv. Email address/fax ABC shall also require its remittance partners to
submit their official fax/email addresses for communication purposes.
Likewise, ABC will provide its official fax/email addresses to its remittance
partners.
5. ABC shall immediately inform concerned agent/subsidiary/tie-up any
discrepancy concerning its remittance instructions for clarification, correction,
or further instruction.
6. Distribution channels (fulfillment partners, couriers, outlets) shall be expected
to exercise due diligence before credit/pay-out/delivery of the remittance
amount are effected/completed:
i. For Cash Pick-Up - Definitive identification of the customer and
verification of his/her signature is required.
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20
ii. For Credit to Account of Beneficiary The account numbers indicated in

the remittance instruction and the records of the correspondent bank
must match for this to be done.
iii. For Door to Door Delivery Only authorized fulfillment partners/couriers
can make deliveries upon the beneficiarys presentation of proper
identification.
7. The procedures for processing inward remittances from receipts of payment
instructions from tie-ups up to distribution of same to different delivery
channels with the end-view of satisfying the remitter/beneficiaries. It does not
include processes at the tie-ups end, or at the distribution channels.
DOER
Processing Officer
Processing Officer
Processing Officer
Processing Officer
Processing Staff
Processing Staff
Processing Staff
Processing Staff
ACTIVITY
Confirmation of Transaction
Download Payment Instruction batch files from the
tie-up web site or FTP folder.
Save the downloaded Payment Instruction batch
files to the assigned tie-up folders.
Verify the contents of the Payment Instruction as to;
total amount, number of items, message number
and Testkey codes..etc.
Log the Payment Instruction details (Transaction
date, amount, batch name and signature) on the
Tie-up Validation Sheet (Annex A).
Validate the indicated Testkey Code and Message
number based on the assigned Tie-up Testkey
Codes (Annex B)
Confirm the receipt of Payment Instruction batch
files to Tie-ups thru Email or other agreed mode of
communication.
Remittance Take-up
Log on to the Nautilus Remittance System. Go to
Remittance Take-up Menu.
Load the transaction on the Nautilus Remittance
System and save.
Note: In this stage an automated filtering of items
against the OFAC and PEP (Philippines) list is being
triggered by the system. A notification will be
prompted upon a match. A report must be prepared
for AMLAC.
Verify unassigned items.
Note: If no service code was provided on the
Remittance Instruction, the following rules will apply:
1. If the bank name and bank account number are
present the service mode must be Credit to Bank.
2. If home address is present the service mode
must be Door to Door Delivery.
3. If neither home address nor bank details are
present the service mode will be Cash Pick-up.
4. If either of the above premises were present, the
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21
item should be lodged into AP account.

Processing Staff
Processing Officer
Processing Officer
Processing Staff
Processing Staff
Processing Staff
Processing Staff
Processing Staff
Processing Staff
Processing Staff
Processing Staff
Processing Staff
Feedback Staff
Preview and generate the Draft Prooflist of the

verified batch file.
Validate the contents of Draft Prooflist against the
raw batch file as to amounts, number of items,
exchange rate, service charges and sufficiency of
tie-up account balance to cover the transaction.
Note: PURGE the loaded batch if the exchange
rate applied or the total amounts and items vary
from the contents of the raw file.
POST transaction if all the necessary data are
correct.
Generate the Final Prooflist and save to the
designated tie-up folder/back up file using a PDF file
format.
Payout Routing and Dispatch
Go to Payout Dispatch Menu and click the
Routing tab.
Prepare the Transfer list for each service mode
(Deposit, Pick-up and Delivery) and Auto/manually
assign the Agents (courier, outlet and bank)
Go to Dispatch tab and prepare the Transfer File
for each Agent.
Go to Download tab and click each Agent.
(Note: The file will not be exported to Agents folder
if the Tie-up Balance is insufficient to cover the
transaction amount)
Under the Download menu generate the text alert
list.
Under the Document menu generate the transfer
list for each agent.
Note: Please refer to Annex A for the uploading
procedure in Cebuana Lhuillier, MLhuillier, MPI Web
service Application, Security Bank Digibanker and
BPI Connect Direct
Generate the Batch Summary Report.
Generate a PDF file for the Transfer List and Batch
Summary Report and save to the designated tie-up
folder/back-up.
Note: The designated back-up folder will contain the
Remittance Instruction file, Final Prooflist, Transfer
List and Batch Summary Report.
Feedback
All items with missing details lodged under AP
account shall be advised to respective tie-up as
soon
as
possible
for
their
appropriate
action/amendment instruction.
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22
Feedback Staff
Feedback Staff
Feedback Staff
Feedback Staff
Feedback Staff
Processing Officer
Feedback Staff
Feedback Staff
Processing Officer
Feedback Staff
Feedback Staff
Feedback Staff
Feedback Staff
IX.
Download immediately upon availability the status

report from respective couriers, outlets and bank for
all the remittance items forwarded to them by ABC.
This will be sent to ABC using a prescribe file format
through FTP or Email.
Log on to ABC Remittance System Completion
Module. Upload the feedback file from various
couriers, outlets and banks.
Go the Feedback Menu and generate a status
report for the respective foreign Tie-ups.
Save a PDF File for the respective tie-ups.
Send the foreign tie-up Status report thru email.
Amendments
Validate the Testkey Code (Annex B) of the
incoming amendment instruction and log the
transaction on the respective tie-up validation forms
(Annex A).
Notes: All amendments, refunds and cancellation
must be supported by a coded advice from tie-ups.
Confirm receipt of the validated Amendment
Instruction through Email.
Go to Special Transactions, from the Amendment
menu search for the control number of the
transaction for amendment. Amend the details of
the transaction based on the received amendment
instruction.
Notes: Only cancelled and on-hold items can be
amended.
Check the details of the amended transaction
against the received amendment instruction, if
correct, go to Release Remittance Hold menu and
release the transaction.
Under the Payout Dispatch menu rout the
transaction to the assigned agent.
Dispatch the routed transaction
Download the dispatched item.
Print the Batch Summary Report and Transfer list
and save the soft copies to the back-up folder.
Training Program
1. ABC shall provide all its staff and personnel, including directors and officers, with
education and training ABC to ensure that they are fully aware of their personal
obligations and responsibilities to combat money laundering and to familiarize
themselves with the system for reporting and investigating suspicious matters.
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23
2. ABC may, due to the scale and nature of its operations, assign the internal audit
or training functions to another entity (e.g. professional association, parent
company or external auditors). Where ABC delegates its responsibilities for
audit and training, due diligence is to be exercised to ensure that the persons
appointed are able to perform these functions effectively and the fact of such
appointment must be relayed in writing to the Council.
3. Timing and content of training for various sectors of staff will need to be adapted
by ABC for its own needs. The following may be included:.
a. New Staff. General background of money laundering, the ability to identify suspicious
transactions and method of reporting these to the appropriate designated point person
within ABC This training shall be provided to all new employees, regardless of level of
seniority.
b. Supervisors and Managers. A more comprehensive course that covers all aspects of
money laundering procedures should be provided to supervisors and managers. This will
include the offenses and penalties arising from the Act, procedures relating to service of
production and restraint orders, internal reporting procedures, and the requirements for
verification of identity and the retention of records.
4. ABC shall make arrangements for refresher courses at least once a year to
remind key staff of their responsibilities and to make them aware of any changes
in the laws and rules relating to money laundering, as well as the internal
procedures of ABC.
X.
Recruitment Process
ABC Remittance Corporation commits itself to hiring individuals who reflect diverse
backgrounds, possess the qualifications, values and potential necessary to achieve
company goals. These hiring policies involve sound practices to ensure that company
risk is minimized.
1. Posting Requirements
Once the listing for job openings has been completed, the position may be
posted on Jobstreet, company website or newspaper classified ads for
candidates to apply. Use of search engines to source candidates for a
position is permissible.
2. Applicant Eligibility
A candidate must meet the qualification standard for the position. Human
resources will conduct a record review of the candidate and determine
his/her eligibility for hire.
3. Applications for Employment
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24
All internal and external applications for staff positions will be posted and
made available whether online or classified ads. Applications will comply
with all legal requirements.
4. Interview Process
Candidates will be screened in order to determine whether they meet the
minimum requirements for the position. Those determined to meet the
requirements will be passed on to the hiring manager. Candidates selected will
be interviewed in person and progress to subsequent steps in the process
based on the interview results.
5. Offers of Employment
Compensation offered must be consistent with company policy.
Employment offers are commitments on behalf of the Company. It must
ensure that every offer made to an individual complies with company and
legal requirements.
6. Pre-Employment Background Reviews
Candidates will be subject to testing procedures. The company conducts
various checks on applicants for employment to ensure that individuals
who join the company workforce are qualified, have potential to be
productive and successful, and have honestly presented their qualifications
on the Employment Application.
8. Pre-Employment Physical Examinations
Physical examinations are not required by the company and are not conditional for
employment.However, the company reserves the right to require post-offer, preemployment physical exams in circumstances where the nature of the work renders it
appropriate or where law or regulation requires.
XI.
Internal Audit System

The internal audit function associated with money laundering and terrorist financing
should be conducted by qualified personnel who are not affiliated with the office being
audited. Support of the board of directors and senior management is needed, as well
a direct reporting line to the board or a board level audit committee.
In addition, the internal audit shall also be responsible for the following:
a. periodic and independent evaluation of the risk management;
b. degree of adherence to internal control mechanisms related to the customer
identification process, such as the determination of the existence of customers
and the completeness of the minimum information and/or documents
establishing the true and full identity of, and the extent and standard of due
diligence applied to, customers;
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25
c. CT and ST reporting and record keeping and retention; and

d. Determination of the adequacy and effectiveness of other existing internal
controls associated with money laundering and financing terrorist activities.
Internal audit results shall be immediately communicated to the board of directors. It
must also be available for for scrutiny by BSP examiners in the course of the regular
or special examination without prejudice to the conduct of its own evaluation
whenever necessary.
Results of the audit shall likewise be promptly communicated to the compliance office
for its appropriate corrective action. The Compliance Office shall regularly submit
reports to the board to inform them of managements action to address deficiencies
noted in the audit.
XII.
Independent Audit Program

An Anti-Money Laundering (AML) audit by an external auditing firm must be
conducted annually to determine whether ABC has an appropriate AML program.
An AML audit generally includes the following:
a.
b.
c.
d.
e.
f.
g.
XIII.
A full review of the company's AML compliance program manual

Testing of the company's AML Policy and Procedures
Customer Identification Procedure (CIP) review
Transactional testing and evaluation
CTRs and STRs filings review
Evaluation of AML training; and
Review of past audit reports to assess the efficacy of recommended
implemented changes
Compliance Monitoring
(Mechanism that ensures all noted deficiencies are corrected)
1. All the audit findings and noted deficiencies shall be addressed and corrected.
The revisions must be recorded and integrated in the revised version of the
MLPP for review and approval by the ABC Board of Directors.
2. ABC shall ensure its continued compliance with the institution's policies,
procedures and guidelines on money transfers, particularly with regard to antimoney laundering.
3. Occasional review of its policies and procedures, implementation of necessary
revisions for product development, as well as the introduction of better
safeguards against money laundering.
XIV.
Cooperation with AMLC
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26
Management shall cooperate fully with the Anti-Money Laundering Council

(AMLC) and the Bangko Sentral ng Pilipinas (Central Bank of the Philippines)
within the limits allowed by law.
Review and submission of reports is one way in which the management
cooperates with the Anti-Money Laundering Council through proactive and
diligent approaches. Constant communication with authority will be fostered in
order to ensure clear understanding of its stipulated rules and regulations.
XV.
Designation of Compliance Officer

1. ABC hereby appoints a Compliance Officer to advise its management and staff
on the issuing and enforcement of in-house instructions to ensure adherence to
AMLA rules and regulations, including personnel training, reporting of suspicious
transactions, and generally, all matters relating to the prevention of money
laundering.
2. ABC hereby appoints a Compliance Officer with the following duties and
responsibilities:
a) Establishment and enactment of a manual of compliance procedures in
relation to the business of ABC;
b) Responsibility for ensuring compliance by the staff of ABC with the
provisions of the Anti-Money Laundering Act.
c) Serves as the link between ABC and the Anti-Money Laundering Council
(AMLC) concerning legal matters
d) Preparation and submission of written reports on ABCs compliance with
the provisions of the law, in such form and submitted at such time as the
AMLC may determine.
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ABC Remittance Corporation - Revised File

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MONEY LAUNDERING AND TERRORIST

Revised MLPP - May 2016