AMLCFT For GELM Agents PDF

ANTI-MONEY LAUNDERING &
COUNTER FINANCING OF
TERRORISM (AML/CFT)
FRAMEWORK AND GUIDELINES
Agents Reading Material

2016
Disclaimer:
This reading material is purely used for the internal agency of Great Eastern Life Assurance (Malaysia) Berhad. All or any part of the contents of this
reading material shall not be used directly or indirectly for soliciting insurance business, policyholder services and/or facilitating any other form of
communications with any external party whatsoever. This information is correct as at 03/04/2016
CFE/STF/AML_CFT/03/04/2016V1
PAGE 1 FOR INTERNAL CIRCULATION & TRAINING PURPOSES ONLY
COURSE OBJECTIVES
To create awareness amongst agents and employees on Anti-Money

Laundering and Counter Financing of Terrorism (AML/CFT) legislation
and the regulatory guideline derived from it and appreciate its
importance.
To create understanding of the AML/CFT framework that determines

the AML/CFT policy and standards in the Company.
To create an understanding on the impact of money laundering and

terrorist financing to the Company.
PAGE 2 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
CIRCULATION FINANCING
& TRAINING PURPOSESOFONLY
TERRORISM (AML/CFT)
SCOPE OF COVERAGE
Definitions of Money Laundering & Terrorist Financing

(ML/TF)
The Anti-Money Laundering/Counter Financing of
Terrorism (AML/CFT) Legislation & Bank Negara
Malaysia (BNM) Guidelines
The AML/CFT Framework
Reporting Structure
Suspicious Cases Modus Operandi
Other developments on AML/CFT
PAGE 3 ANTI-MONEY
FOR LAUNDERING
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Definition of Money Laundering
A process whereby criminals attempt to hide & disguise the

true origin and ownership of the proceeds derived from
criminal activities to give it a legitimate appearance.
This is a process to make illegitimate income appear

legitimate thereby avoiding prosecution, conviction &
confiscation of the criminal funds.
PAGE 4 ANTI-MONEY
FOR LAUNDERING
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Definition of Money Laundering Under
AML/CFT Legislation
The definition of Anti-Money Laundering,

Anti-Terrorism Financing and Proceeds of Unlawful
Activities Act 2001 (AMLA 2001) states that
Money laundering is the act of a person who:
a) Engages, directly or indirectly, in a transaction that involves proceeds

from any unlawful activity.
b) Acquires, receives, possesses, disguises, transfers, converts, exchanges,

carries, disposes, uses, removes from or brings into Malaysia proceeds
of any unlawful activity.
c) Conceals, disguises or impedes the establishment of the true nature,

origin, location, movement, disposition, title of, rights with respect to, or
ownership of, proceeds of any unlawful activity.
PAGE 5 ANTI-MONEY
FOR LAUNDERING
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Who are the Money Launderers?
The typical characteristics of money launderers are:-
Focused on intent
Innovative / Knowledgeable
Rich
Prepared to lose some money
PAGE 6 ANTI-MONEY
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Money Laundering Process
Also called
Introducing
whitewashing.
illegal
profits into Conversion /
the financial movements to
system separate the illicit
proceeds from their
source
To disguise
audit trail
Provide an
appearance of
legitimacy
After the Layering process, the money are then Provide
reintroduced into the financial / business anonymity
system - for example: investments in business,
purchase of assets
PAGE 7 ANTI-MONEY
FOR LAUNDERING
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Definition of Financing of Terrorism
Financing of terrorism generally refers to carrying out transactions

involving funds that may or may not be owned by terrorist, or that have
been, or are intended to be, used to assist the commission of terrorism.
More detailed description of financing of terrorism includes :
1) providing or collecting properties for carrying out an act of

terrorism
2) providing services for terrorism purposes
3) arranging for the retention or control of terrorist properties or

dealing with terrorist properties.
PAGE 8 ANTI-MONEY
FOR LAUNDERING
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TERRORISM (AML/CFT)
AML/CFT Legislation and Regulation
Purpose : To ensure that insurance/takaful industry has a strong control and
initiative on anti-money laundering efforts.
Current AML/CFT Legislation and Regulation for insurance/takaful industry

include : 1)
New
1)UPW/GP1 : Standard
Guidelines on Anti Money
Anti-Money 1) JPI/GPI 27 - Laundering and Counter
Laundering, Anti- Guidelines on Anti- 1) BNM/RH/STD 029
Financing of Terrorism
Terrorism Money Laundering 1 Anti-Money
(AML/CFT).
Financing and Measures for the Laundering and
Proceeds of Insurance Industry - Counter Financing of
2) UPW/GP1 [2]: Anti-
Unlawful Activities issued on Terrorism (AML/CFT)
Money Laundering and
Act 2001 effective 25/4/2001 Insurance and Takaful
Counter Financing of
on 15 /1/ 2002 (Sector 2)
Terrorism (AML/CFT)
(AMLA 2001) 2) JPI 20/2004 Sectorial Guidelines 2 for
previously known as AMLA 2001 Issued on 4/9/2013 and
Insurance and Takaful
The Anti-Money Verification took effect on
Industries.
Laundering and Anti- Procedures 15/9/2013
Terrorism Financing issued on Originally Issued on
Act 2001 21/8/2004 15/11/2006 and revision
on 3 /2/2009
Legislation Regulations
Note: The regulatory guideline was issued in accordance with the AMLA 2001 and Financial Action Task Forces
(FATF) 40 Recommendations for Implementation with effect from 15 September 2013.
For more details on AML/CFT Legislation and Regulation, please visit: http://amlcft.bnm.gov.my/AMLCFT07.html
PAGE 9 FOR INTERNAL
ANTI-MONEY CIRCULATION
LAUNDERING & TRAINING
& COUNTER PURPOSES
FINANCING OFONLY
TERRORISM (AML/CFT)
Governing Legislation and Regulation
AMLA 2001 & the Governing Guideline
Government Agencies
Regulator Reporting
National Coordination Committee:
Companies Commission of Malaysia Institutions
Labuan Financial Services Authority
Registrar of Societies
Securities commission
Banks
Inland Revenue Board
Immigration Department
MACC Deposit-Taking
Royal Malaysian Customs
Bank Negara Institutions
Royal Malaysia Police Collaboration Malaysia
Ministry of Finance
Ministry of Foreign Affairs (BNM) Money Services
Home Ministry Business
Ministry of Domestic Trade
Cooperatives & Consumerism Competent Authority
Attorney-General Chambers appointed oversee the Insurer
Insurers
Ministry of International Trade & enforcement of AMLA 2001 (Great Eastern)
Industry
* Full list in 1st schedule of AMLA
2001.
PAGE 10 ANTI-MONEY
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What is a Serious Offence?
Defined as an illegal activity which is related, directly or indirectly to

ML/TF:
any of the serious offences specified in the Second Schedule of
AMLA 2001.
An attempt to commit any of those offences, or
Abetment of any of those offences.
The AMLA 2001 covers serious offences committed in Malaysia and

offence committed in a foreign country which would also constitute a
serious offence in Malaysia.
The serious offences are as set out in the 2nd schedule of AMLA 2001,
taken from 42 legislations.
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What is Serious Offence?
2nd Schedule of AMLA 2001:
Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001. International Trade in Endangered Species Act 2008.
Anti-Trafficking in Persons and Anti-Smuggling of Migrants Act 2007. Islamic Financial Services Act 2013.
Betting Act 1953. Kidnapping Act 1961.
Capital Markets and Services Act 2007. Kootu Funds (Prohibition) Act 1971.
Child Act 2001. Labuan Financial Services and Securities Act 2010.
Common Gaming House Act 1953. Labuan Islamic Financial Services and Securities Act 2010.
Companies Act 1965. Malaysia Anti-Corruption Commission Act 2009.
Control of Supplies Act 1961. Malaysia Palm Oil Board (Licensing) Regulations 2005.
Control of Supplies Regulations 1974. Malaysian Timber Industry Board (Incorporation) Act 1973.
Copyright Act 1987. Moneylenders Act 1951.
Corrosive and Explosive Substances and Offensive Weapons Act 1958. Money Services Business Act 2011.
Customs Act 1967. Optical Discs Act 2000.
Dangerous Drugs Act 1952. Pawnbrokers Act 1972.
Dangerous Drugs (Forfeiture of Property) Act 1988. Penal Code.
Development Financial Institutions Act 2002. Sales Tax Act 1972.
Direct Sales and Anti-Pyramid Scheme Act 1993. Service Tax Act 1975.
Excise Act 1976. Strategic Trade 2010.
Explosives Act 1957. Strategic Trade (United Security Council Resolutions) Regulations 2010.
Financial Services Act 2013. Trade Descriptions Act 2011.

Firearms (Increased Penalties) Act 1971. Wildlife Conservation Act 2010.
Income Tax Act 1967. Malaysian Palm Oil Board Act 1998
PAGE 12 FOR INTERNAL
& COUNTER PURPOSES
FINANCING OFONLY
TERRORISM (AML/CFT)
What is Serious Offence?
Some examples of serious offences include :
Corruption/ bribery.
Smuggling offences.
Trafficking in firearms/ drugs.
Unlawful gambling, deposit taking or investment schemes.
Robbery/ murder/ theft/ extortion/ kidnapping/ abduction.
Infringement of copyright.
Person living on or trading in prostitution.
Criminal breach of trust (CBT)/ cheating/ forgery.
Insider trading/ market manipulation.
Carrying on banking/FI/merchant banking/discount house/ money-
broking, insurance, insurance broking, adjusting business, Takaful business
without valid license.
PAGE 13 ANTI-MONEY
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Key Provisions in AMLA 2001
Section 4
Description Implication
Any person who engages in or attempts 5 times the value of proceeds or RM5
to engage in, or abets the commission of million (whichever is higher), and 15
money laundering, commits an offence years imprisonment.
Section 20
The provision overrides any obligation as No institution under the law can
to secrecy or other restriction on the withheld information of suspected
disclosure of information imposed by person from investigating officer.
any written law or otherwise.
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Section 22
Officer of a Reporting Institution shall RM1 million or 3 years imprisonment
take all reasonable steps to ensure or both
compliance with AMLA 2001.
in the case of continuing offence, a further fine but < RM3K for each day or part thereof
during which the offence continues to be committed.
Section 24 Protection Of Person Reporting
No civil, criminal or disciplinary Person who aids in the investigation by
proceedings shall be brought against a disclosing or supplying information will be
person who discloses or supplies any protected by the law.
information unless it is done in bad faith.
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Section 26
Failure to provide document or RM3 million or 5 years imprisonment
information requested by the examiner. or both
Section 27
Failure to appear before the examiner RM3 million or 5 years imprisonment
or both
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Section 35 Tipping Off (Leakage of information)

If you disclose any information to anyone Liable upon conviction
about a proposed investigation. RM3 million or 5 years imprisonment
or both
Section 37 (3) Failure to Deliver Property, Record, Report Or Document

Failure to provide any property/ record/ Liable upon conviction
report/ document that is required by an RM3 million or 5 years imprisonment
investigating officer. or both
* in the case of continuing offence, a further fine but RM1K for each day during which
the offence continues after conviction.
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Section 38 Power To Seize Of Property, Record Or Documents

An investigation officer may seize, take In previous cases, certain records, reports
possession of and retain for such duration and documents has been requested by
as he deems necessary, any property, IOs from MACC where the original are
record, report or document produced taken & retain.
before him in the course of an
examination.
Section 41 Investigation Officer May Arrest Without Warrant

Investigating officer may arrest without This is not necessary done only by the
warrant a person whom he reasonably police but agents from other law
suspects to have committed or to be enforcement agencies like MACC.
committing any offence under this Act.
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Section 86
For penalty that is not expressly < RM1 million
provided for any offences under AMLA
Section 92
Further empowers BNM to compound Compound rate of 50% of the
in cases of continuing offence maximum fine amount
PAGE 19 ANTI-MONEY
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Section 87 Offence Committed By Any Person In An Official Capacity

Where an offence is committed by a corporation / For a company like
association, the director, controller, officer / partner / Great Eastern, the
person concerned in management is deemed guilty liable person could be
unless he proves that : the Compliance
Officer, Head of
The offence is committed without the consent or Department and/or
connivance; and persons responsible
He exercised such diligence to prevent the
for certain tasks
commission of the offence as he ought to have
exercised, having regard to the nature of his function
in that capacity and to the circumstances.
PAGE 20 ANTI-MONEY
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As Required by BNMs AML/CFT Guidelines & Group
AML/CFT Policy:
Risk Based Approach Application
Customer Acceptance Standard
Customer Due Diligence Standard
On-Going Monitoring Standard
AML/CFT Training Standard
Record Keeping Practices
Suspicious Transaction Reporting
Combating The Financing Of Terrorism
PAGE 21 ANTI-MONEY
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Customer Acceptance Standard

Reporting Institutions are required to develop policy and procedures to
address the establishment of business relationship with the customer.
The objective is to address different risks posed by each type of customer

through profiling.
Risk profiling Factors to consider:
the origin of the customers and location of business

background or profile of the customer
nature of the customers business
structure of ownership for a corporate customer
any other information suggesting that the customer is of higher risk
PAGE 22 ANTI-MONEY
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Customer Due Diligence Standard Know Your Customers (KYC)
Identification & Verification
Determine the true identity of prospect, to verify and be satisfied that:
Identity of customer is genuine. The Company shall not have any business dealings
with
i. anonymous person or any person using a fictitious name
ii. non-policy holder who does not transact in relation to an insurance policy issued
by the company
iii. financial institutions which do not have adequate controls against criminal
activities or shell banks
iv. any person and entities sanctioned/designated in the Monetary Authority of
Singapore (MAS) & BNM (Anti-terrorism Measures) regulations or other
applicable regulations issued by the relevant authorities.
Insurance/Takaful transaction to be undertaken is legitimate
Verify all parties to the contract include any underlying principals that
policy/certificate owners are acting on behalf, all joint applicants to the contract,
principal shareholders and directors for group life policies/certificates and to include
verification of beneficiaries if they are not the policy/certificate owners.
PAGE 23 ANTI-MONEY
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Generally, verification should be performed at the point of sale and via face-to-face contact.
Although the ultimate responsibility of CDD remains with the Insurance Company / Takaful
Operator, reliance is placed on agents/intermediaries as first point of contact to perform
Customer Due Diligence (CDD) at point of sale.
Amount of Premium Any amount (effective from 1 January 2014)
On who? Customer, its Beneficial Owner Beneficiary, Payee, Executors/

and Natural Person appointed to Administrators of an estate in
act on a customers behalf. relation to death claims and
also to panel hospitals, panel
clinics and service provider
Identification When establishing business At the point of nomination and
relationship at the time of payout
Verification *When establishing business Latest at the point of payout

relationship
PAGE 24 ANTI-MONEY
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Current CDD Practices
Information and documents required to perform identification and verification
A.Individual Customers
Obtain at least the following information:
Full name
NRIC / passport number
Permanent and mailing address
Date and place of birth
Nationality
Occupation type
Name of employer & nature of business
To be substantiated / verified against :

NRIC for Malaysians/permanent residents
Passport for foreigners
A copy of the verified documents should be collected by agents/intermediaries and

retained by the insurer/takaful operator regardless of premium/contribution amount
(effective from 1 January 2014) ANTI-MONEY LAUNDERING & COUNTER FINANCING OF TERRORISM (AML/CFT)
PAGE 25 FOR INTERNAL CIRCULATION & TRAINING PURPOSES ONLY
B. Corporate Customers
Understand the ownership and control structure in order to detect any unusual circumstances
concerning the changes to the company/business structure or ownership.
Furnish the following a copy of the following documents:
1) Memorandum/Article/Certificate of Incorporation/Partnership
2) Identification document of Directors/Shareholders/Partners (Form 24/Form 49,
may be accepted)
3) Board of Directors/Directors Resolution
4) Authorisation for any person to represent the company/business
5) Identification document of authorised person
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B. Corporate Customers (contd)
To identify the natural person(s) (directors/ shareholders) with equity interest of more than
25%. Where no natural person is identified, to identify relevant natural person who holds the
position of senior management of the corporation.
C. Clubs, Societies and Charities
Furnish the following documents:

relevant constituent documents (or other similar documents).
the identification of the office bearer.
authorisation for any person to represent the club, society or charity.
D. Legal Arrangements
Take reasonable measures to:

Understand the relationship among the relevant parties.
Obtain satisfactory evidence of its legal status the identity of the relevant parties.
The nature of their capacity and duties as trustee or nominee. (in Great Eastern,
we do not deal with Power of Attorney)
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Know Your Customer (KYC)
For higher risk customers or in a more suspicious situation, further CDD measure known
as KYC is conducted. This is done through completion of the follow forms, depending on
the threshold of sum assured or annualized premium/contribution:
Financial Questionnaire 1 To be filled by agent on customers behalf. Details to be

completed includes purpose of insurance/takaful, proposers annual earned & unearned
income, and declaration of networth.
Financial Questionnaire 2 To be filled by customer. Details to be completed

includes, purpose of insurance/takaful, proposers annual earned & unearned income,
percentage of in company share (for company directors only), and relationship to life
assured/person covered (if different).
PAGE 28 ANTI-MONEY
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Customer Due Diligence Standard ECDD
Enhanced Customer Due Diligence (ECDD)
The Company shall conduct enhanced due diligence on higher risk customers or
when establishing a business relationship with customers:
Whom are suspected of money laundering or financing of terrorism
Where there are doubts about the reliability or adequacy of previously
obtained information
An ECDD will include the following measures:

Obtaining more detailed information on the customer and through publicly
available information, in particular, on the purpose of the transaction and
source of funds and
Obtaining approval from the Senior Management before establishing any
business relationship with the customer.
* Unwillingness of customer to cooperate may itself be a factor of suspicion. It is

the Companys policy that underwriters shall not underwrite unless sufficient
identification evidence is provided.
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Customer Due Diligence Standard ECDD
POLITICALLY EXPOSED PERSON (PEP)
PEPs are foreign / domestic individuals being, or who have been, entrusted with prominent
public functions. E.g. heads of state or government, senior politicians, senior government
officials, judicial or military officials and senior executives of public organisations
The concern placed in dealing with PEPs lies with the possibility of such PEPs abusing their
public powers for their own illicit enrichment, especially in countries where corruption is
widespread
Agents are to inform/ disclose to the Company if the current or new customers are PEPs or
related to PEPs in the proposal form/agents confidential report
Company is required to take appropriate measures to establish the source of wealth and
source of funds of such person
PAGE 30 ANTI-MONEY
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Training Standard
AML/CFT Training Standard sets out the requirement for the Training & Awareness
Programme
Minimum training requirement includes:
New employees and agents. It is compulsory for all agents to undergo AML/CFT
Training within 2 years of joining the Company.
The Board of Directors and Senior Management team to ensure that there is
adequate training provided including promoting staff awareness on individual
AML/CFT obligations and penalties if they failed to discharge their duties properly
under the Act.
Refresher course will also be made available on regular basis for all staff (including
agents) who have attended the initial training.
PAGE 31 ANTI-MONEY
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Record Keeping Practices
Records should be kept for a period of NOT LESS THAN 6 years from the
date an account has been closed or transaction has been completed or
terminated.
Scope of record keeping extended to include accounts, business

correspondence and documents relating to an account, business
relationship, transaction or activity with a customer as well as result of any
analysis taken.
Failing to comply, a fine of up to RM3 million or imprisonment to a term not

exceeding 5 years would be imposed.
Agents are encouraged to inform the Company to update the customers

records when there are changes/updates in the customers personal
information including but not limited to their NRIC/passport number,
nationality, occupation/employment and nature of business.
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Recognizing & Reporting Suspicious Transactions on ML/TF

(Section 14)
What is Suspicion?
Subjective and there is no specific provision or definition in AMLA.
With effect from 9/3/2007, Reporting Institutions are also required to report any
ATTEMPTED transaction(s) that are suspicious (apart from reporting the completed
transaction(s) that are suspicious).
Suspicious Transaction? What to Look Out For?

1. Transactions That Do Not Make Economic Sense
Transactions in which the nature, size or frequency appears unusual.
Transactions which are incompatible with the customers normal activity or beyond
the customers financial means.
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Recognizing & Reporting Suspicious Transactions (Section 14)
2. Transactions Involving Unusual receipts or payment of funds
Transactions whereby large or unusual premium/contribution payment in cash

is received from customer.
Transactions which funds are paid or received through unrelated third party.
3. Others
Abnormal patterns of top-ups and withdrawals for investment linked

policies/certificates.
PAGE 34 ANTI-MONEY
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Suspicious Cases Modus Operandi
Request for refund to be paid to unrelated 3rd party.
Change payment mode when requested to complete financial questionnaire.
rd
Use of funds from 3 party (seemingly related) for Investment Linked top-up
and subsequently early cancellation/withdrawal.
Series of application of policy loans and repayments within a short time

period.
Unrealistic wealth compared with customers financial profile.
Staggered policies/certificate surrender (with small amount of surrender value

per policy/certificate, cumulatively, the surrender amount are huge) within
several months, with reason not satisfied with agent's services, which could
have been done in one occasion.
Large sum of cash premium/contribution payment.

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Reporting Suspicious Transaction

In the event of any suspicious transactions
KEY OPERATING DEPTS, detected, it is important to escalate to
Compliance within 2 working days via the
AGENTS & OTHER INTERMEDIARIES following communication channels:-
Head Office or Branch Offices Email:
GELM/OACM: AML-MY@greateasternlife.com
GETB : ComplianceSecretariat@i-great.com.my
COMPLIANCE DEPARTMENT
Fax: 03-48133798
Financial Crime Intervention Unit
Mail :
GELM & OACM GETB
Compliance Dept, Level 10 Compliance Dept, Level 3
BANK NEGARA MALAYSIA Menara Great Eastern, Menara Great Eastern,
Financial Intelligence Unit (FIU) No. 303, Jalan Ampang, No. 303, Jalan Ampang,
50450 Kuala Lumpur. 50450 Kuala Lumpur.
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Sanctions Compliance
Sanction is a restriction or prohibition, imposed by one country or

group of countries forming an alliance (sanctioning party) to another
country, region, entity, vessel or an individual (the sanctioned party),
that is intended to coerce certain behaviours on the part of, or to
achieve a certain result with respect to, the sanctioned party.
There are various types of sanctions:

Diplomatic
Military
Sports
Trade
Economic/Financial
PAGE 37 ANTI-MONEY
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Economic/financial/trade sanctions aim to achieve domestic and

foreign policy goals set by national governments and international
bodies, including:
Diminishing the power and influence of regimes considered to be a

security threat or oppressive to their subjects
Cutting off international criminals, such as narcotics traffickers and

terrorists from the financial system
Preventing the proliferation of weapons of mass destruction
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Sanctioned Countries refer to the countries which are subjected to a

comprehensive sanction program by the sanctioning party. Comprehensive
sanction generally prohibits all direct or indirect imports/exports, trade brokering,
financing or facilitating against most goods, technology and services.
Currently, the following are deemed to be Sanctioned Countries (in line with
OCBC):
- Cuba;
- Crimea Region of Ukraine;
- Iran;
- Sudan;
- Democratic Peoples Republic of Korea
(North Korea); and
- Syria
Sanctioned Person refers to an individual or entity which is being sanctioned

by the sanctioning party, including the family members and close associates of
such individual or entity.
PAGE 39 ANTI-MONEY
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Sanctioning Countries & Bodies
Apart from sanctions of United Nation Security Council (UNSC) which are
relating to terrorist financing and proliferation financing, sanctions from the
following countries and bodies shall also be observed and adhered to:
1. Bank Negara Malaysia (BNM) of any other relevant Malaysia government

agencies
2. Monetary Authority of Singapore (MAS) or any other relevant Singapore
government agencies
3. Office of Foreign Assets Control (OFAC) under US Treasury
4. European Union (EU)
PAGE 40 ANTI-MONEY
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Sanctioning Countries & Bodies - Why OFAC and EU?
Although we may not be considered as US Person or EU Member, sanctions

imposed by OFAC and EU may apply extra-territorially and could have a bearing on
reputation and operations of Great Eastern if we are found violating the sanctions
either directly or indirectly.
Having said that, our parent company, OCBC, has operations in US, and any violation
by Great Eastern may have an adverse impact on OCBC. Furthermore, any
transaction that involves US dollars is by default subject to US jurisdiction as all US
dollar transactions must be cleared through the United States.
Therefore, we will not tolerate the use of our company for the conduct of criminal and
illicit activities.
The extra-territorial reach of sanctions from these bodies, e.g. OFAC or US

Government Agencies can be noticed from the various fines imposed on non-US
Banks.
PAGE 41 ANTI-MONEY
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Sanctions Risk
Risk of violating financial and economic sanctions either directly or indirectly which
could have adverse impact to the company, including monetary fines, revocation of
business licence and designation as sanctioned entity.
Sanctions imposed by Malaysian government, Singapore government and

international bodies on certain countries, individuals or entities may expose a Great
Eastern Entity, the Great Eastern Group or even OCBC Group to sanctions risks if
we establish business relations with such countries, individuals or entities. [Direct]
In addition, individuals or entities whose activities contravene sanctions, embargoes

or similar measures imposed by Malaysian government, Singapore government and
international bodies may also expose a Great Eastern Entity, the Great Eastern
Group or even OCBC Group to sanctions risks if business relations are established
with such individuals or entities. [Indirect]
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TERRORISM (AML/CFT)
Sanction Compliance Program
Great Eastern Entity is not allowed to establish business relationship or have

any business dealings with the following sanctioned person. (Category A):
Customers who are designated as terrorist or sanctioned by/under: UNSC; OFAC; EU; any other specified
terrorist or sanction list(s) as prescribed by BNM/MAS or the relevant local regulators. This would include
customers who are related or close associates (RCA) of the above persons. These are termed as Designated
Persons.
Natural customers, without valid residence status or permit issued by the government or authorities of the
host country of that GE Entity, who are from countries sanctioned by: UNSC; OFAC; EU; any other specified
sanction list(s) as prescribed by BNM/ MAS or the relevant local regulators.
Non-natural customers, not included under general licenses or exceptions, who are incorporated in
countries sanctioned by: UNSC; OFAC; EU; or any other specified sanction list(s) as prescribed by BNM/MAS
or the relevant local regulators.
Customers who are not from sanctioned countries but associated with parties who are sanctioned or from
sanctioned countries whose activities contravene sanctions, embargoes and similar measures imposed by:
UNSC; OFAC; EU; or any other specified sanction list(s) as prescribed by BNM/MAS or the relevant local
regulators
PAGE 43 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
TERRORISM (AML/CFT)
Sanctions - Illustrations
Financial
Provision of
Institution financial services Terrorists or
Sanctioned Persons
Financial
Business
Institution Provision of
ties
financial services Terrorists or
Clean Sanctioned Persons
customers
PAGE 44 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
TERRORISM (AML/CFT)
Breaching of US Sanctions
FINANCIAL INSTITUTION DATE OF FINE / FINE / SETTLEMENT VIOLATION
SETTLEMENT AMOUNT
ABN AMRO May 2010 USD 673.5 Million Wire transfers violating Cuba, Iran, Libya, Sudan
sanctions
Barclays Bank Aug 2010 USD 298 Million Wire transfers violating Iran, Cuba, Sudan, Myanmar
sanctions
JP Morgan Chase Bank Aug 2011 USD 88.3 Million Wire transfers and gold bullion trades violating Iran,
Cuba, Sudan, Myanmar, WMD sanctions
ING Bank N.V. June 2012 USD 619 Million Wire transfers, Letters of credit violating Iran, Cuba,
Sudan, Myanmar sanctions
Standard Chartered Bank, Aug & Dec 2012 USD 667 Million Wire transfers, falsifying books and reports violating
NY Iran sanctions
HSBC Holdings Plc Dec 2012 USD 1.92 Billion Accusations that the bank transferred billions of
dollars for nations like Iran and enabled Mexican drug
cartels to move money illegally through its American
subsidiaries.
BNP Paribas July 2014 USD 9 Billion Allegedly breaking US Sanctions against trade with
Sudan, Iran and Cuba. Engaged in a complex and
pervasive scheme to illegally move billions through
US financial system.
Standard Chartered Bank, August 2014 USD300 Million Further penalty imposed for failing to tackle
NY compliance problems following the fine in 2012 .
Pricewaterhouse Coopers August 2014 USD25 Million and Improperly altered a report on a Japanese banks
suspended from some compliance with anti-money laundering laws.
consulting works.
PAGE 45 FOR INTERNAL
& COUNTER PURPOSES
FINANCING OFONLY
TERRORISM (AML/CFT)
Other Developments on AML
Economic Sanctions
Group AML/CFT Policy
It is Great Easterns policy that we comply with the relevant requirements under
sanctions imposed by the following jurisdictions:
a) Monetary Authority of Singapore (MAS) or any other relevant Singapore
government agencies
b) Government or monetary authorities of the host countries where Great Eastern
operates in
c) United Nation Security Council (UNSC)
d) Office of Foreign Assets Control (OFAC) under US Treasury
e) European Union (EU)
The above is in line with OCBCs Sanctions Policy.

Sanctioned persons shall be detected on a timely manner and there shall be no
business dealing with them.
PAGE 46 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
TERRORISM (AML/CFT)
AML WORLD BODY (FATF & APG)
The Financial Action Task Force (FATF) (established in 1989) is an inter-

governmental body whose purpose is the development and promotion of
policies, both at national and international levels, to combat money laundering
and terrorist financing.
The Task Force is therefore a "policy-making body" which works to generate

the necessary political will to bring about national legislative and regulatory
reforms in these areas.
The FATF monitors members' progress in implementing necessary measures,

reviews money laundering and terrorist financing techniques and counter-
measures, and promotes the adoption and implementation of appropriate
measures globally.
PAGE 47 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
TERRORISM (AML/CFT)
AML WORLD BODY (FATF & APG)
Malaysia is a member of FATF and a member of Asia Pacific Group

(APG) on money laundering. APG plays similar role as FATF but at a
regional level.
FATF has established and revised 40 recommendations in 1996 for

combating AML worldwide.
It has further introduced 9 special recommendations in 2001 to

address financing of terrorism activities following Sept 11 incident.
In Feb 2012, FATF has revised its recommendations to 40

recommendations, to strengthen global safeguard and further protect
the integrity of the financial system.
PAGE 48 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
TERRORISM (AML/CFT)
What is Your Responsibility
Need to be more vigilant.
Know the customer well.
Report to Compliance Secretariat if you

suspect or have reason to suspect that
transaction or attempted transaction
involved proceeds from an unlawful
activity or the customer is involved in
money laundering or financing of
terrorism.
PAGE 49 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
TERRORISM (AML/CFT)
All rights reserved. No part of this publication may be produced ,translated, stored in a retrieval system or transmitted in any form
or by any means, electronic, mechanical, photocopying and recording without the prior written permission of the copyright the
developer and owner.
PAGE 50 ANTI-MONEY
FOR LAUNDERING
INTERNAL & COUNTER
TERRORISM (AML/CFT)

AMLCFT For GELM Agents PDF

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ANTI-MONEY LAUNDERING &

Agents Reading Material

To create awareness amongst agents and employees on Anti-Money

To create understanding of the AML/CFT framework that determines

To create an understanding on the impact of money laundering and

Definitions of Money Laundering & Terrorist Financing

A process whereby criminals attempt to hide & disguise the

This is a process to make illegitimate income appear

The definition of Anti-Money Laundering,

a) Engages, directly or indirectly, in a transaction that involves proceeds

b) Acquires, receives, possesses, disguises, transfers, converts, exchanges,

c) Conceals, disguises or impedes the establishment of the true nature,

The typical characteristics of money launderers are:-

Financing of terrorism generally refers to carrying out transactions

More detailed description of financing of terrorism includes :

1) providing or collecting properties for carrying out an act of

2) providing services for terrorism purposes

3) arranging for the retention or control of terrorist properties or

Current AML/CFT Legislation and Regulation for insurance/takaful industry

AMLA 2001 & the Governing Guideline

Defined as an illegal activity which is related, directly or indirectly to

The AMLA 2001 covers serious offences committed in Malaysia and

Financial Services Act 2013. Trade Descriptions Act 2011.

Section 35 Tipping Off (Leakage of information)

Section 37 (3) Failure to Deliver Property, Record, Report Or Document

Section 38 Power To Seize Of Property, Record Or Documents

Section 41 Investigation Officer May Arrest Without Warrant

Section 87 Offence Committed By Any Person In An Official Capacity

Customer Acceptance Standard

The objective is to address different risks posed by each type of customer

Risk profiling Factors to consider:

the origin of the customers and location of business

Insurance/Takaful transaction to be undertaken is legitimate

On who? Customer, its Beneficial Owner Beneficiary, Payee, Executors/

Verification *When establishing business Latest at the point of payout

To be substantiated / verified against :

A copy of the verified documents should be collected by agents/intermediaries and

Furnish the following a copy of the following documents:

C. Clubs, Societies and Charities

Furnish the following documents:

Take reasonable measures to:

Financial Questionnaire 1 To be filled by agent on customers behalf. Details to be

Financial Questionnaire 2 To be filled by customer. Details to be completed

An ECDD will include the following measures:

* Unwillingness of customer to cooperate may itself be a factor of suspicion. It is

Minimum training requirement includes:

Scope of record keeping extended to include accounts, business

Failing to comply, a fine of up to RM3 million or imprisonment to a term not

Agents are encouraged to inform the Company to update the customers

Recognizing & Reporting Suspicious Transactions on ML/TF

Suspicious Transaction? What to Look Out For?

Recognizing & Reporting Suspicious Transactions (Section 14)

2. Transactions Involving Unusual receipts or payment of funds

Transactions whereby large or unusual premium/contribution payment in cash

Abnormal patterns of top-ups and withdrawals for investment linked

Request for refund to be paid to unrelated 3rd party.

Change payment mode when requested to complete financial questionnaire.

Series of application of policy loans and repayments within a short time

Unrealistic wealth compared with customers financial profile.

Staggered policies/certificate surrender (with small amount of surrender value

Large sum of cash premium/contribution payment.

Reporting Suspicious Transaction

Sanction is a restriction or prohibition, imposed by one country or