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TMI BlogPrevention of Money-laundering (Maintenance of Records) Amendment Rules, 2013.X X X X Extracts X X X X X X X X Extracts X X X X ..... rred to in clause (ha) of sub-section (1) of section 2 of the Act; ; (II) after clause (b), the following clause shall be inserted, namely : - (ba) Designated Director means a person designated by the reporting entity to ensure overall compliance with the obligations imposed under chapter IV of the Act and the Rules and includes - (i) the Managing Director or a whole-time Director duly authorized by the Board of Directors if the reporting entity is a company, (ii) the managing partner if the reporting entity is a partnership firm, (iii) the proprietor if the reporting entity is a proprietorship concern, (iv) the managing trustee if the reporting entity is a trust, (v) a person or individual, as the case may be, who controls and manages the affairs of the reporting entity if the reporting entity is an unincorporated association or a body of individuals, and (vi) such other person or class of persons as may be notified by the Government if the reporting entity does not fall in any of the categories above. Explanation . For the purpose of this clause, the terms Managing Director and Whole-time Director shall have the meaning assigned to them in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated with casino; and (vii) establishing or creating a legal person or legal arrangement. - (b) in rule 3, - (I) for the portion beginning with (1) Every banking Company and ending with taken place within a month , the following shall be substituted, namely : - Every reporting entity shall maintain the record of all transactions including, the record of- (A) all cash transactions of the value of more than ten lakh rupees or its equivalent in foreign currency; (B) all series of cash transactions integrally connected to each other which have been individually valued below rupees ten lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the monthly aggregate exceeds an amount of ten lakh rupees or its equivalent in foreign currency; ; (II) after clause (D), the following clauses (E) and (F) shall be inserted, namely: - (E) all cross border wire transfers of the value of more than five lakh rupees or its equivalent in foreign currency where either the origin or destination of fund is in India; (F) all purchase and sale by any person of immovable property valued at fifty lakh rupees or more that is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... information promptly in writing or by fax or by electronic mail to the Director in respect of transactions referred to in clause (D) of sub-rule (1) of rule 3 not later than seven working days on being satisfied that the transaction is suspicious. (3) The Principal Officer of a reporting entity shall furnish, the information in respect of transactions referred to in clause (F) of sub-rule (1) of rule 3, every quarter to the Director by the 15th day of the month succeeding the quarter. (4) For the purpose of this rule, delay of each day in not reporting a transaction or delay of each day in rectifying a mis-reported transaction beyond the time limit as specified in this rule shall constitute a separate violation. 9. Client Due Diligence.- (1) Every reporting entity shall- (a) at the time of commencement of an account-based relationship - (i) identify its clients, verify their identity, obtain information on the purpose and intended nature of the business relationship; and (ii) determine whether a client is acting on behalf of a beneficial owner, and identify the beneficial owner and take all steps to verify the identity of the beneficial owner: Provided th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntrol shall include the right to appoint majority of the directors or to control the management or policy decisions including by virtue of their shareholding or management rights or shareholders agreements or voting agreements; (b) where the client is a partnership firm, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has ownership of/entitlement to more than fifteen percent of capital or profits of the partnership; (c) where the client is an unincorporated association or body of individuals, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has ownership of or entitlement to more than fifteen percent of the property or capital or profits of such association or body of individuals; (d) where no natural person is identified under (a) or (b) or (c) above, the beneficial owner is the relevant natural person who holds the position of senior managing official; (e) where the client is a trust, the identification of beneficial owner(s) shall include identification of the author of the trust, the trustee, the beneficiaries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is suspicion of money laundering or financing of terrorism or other high risk scenarios, the identity of client shall be established through the production of officially valid documents, as referred to in sub-rule (4) of rule 9; and (v) foreign remittance shall not be allowed to be credited into a small account unless the identity of the client is fully established through the production of officially valid documents, as referred to in sub-rule (4) of rule 9. (6) Where the client is a company, it shall for the purposes of sub-rule (1) submit to the reporting entity one certified copy of the following documents:- (i) Certificate of incorporation; (ii) Memorandum and Articles of Association; (iii) A resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf; and (iv) an officially valid document in respect of managers, officers or employees holding an attorney to transact on its behalf. (7) Where the client is a partnership firm, it shall for the purposes of sub-rule (1) submit to the reporting entity one certified copy of the following documents:- (i) registration certificate; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch existing relationships at appropriate times or as may be specified by the regulator, taking into account whether and when client due diligence measures have previously been undertaken and the adequacy of data obtained. (13) (i) Every reporting entity shall carry out risk assessment to identify, assess and take effective measures to mitigate its money laundering and terrorist financing risk for clients, countries or geographic areas, and products, services, transactions or delivery channels that is consistent with any national risk assessment conducted by a body or authority duly notified by the Central Government. (ii) The risk assessment mentioned in clause (i) shall - (a) be documented; (b) consider all the relevant risk factors before determining the level of overall risk and the appropriate level and type of mitigation to be applied; (c) be kept up to date; and (d) be available to competent authorities and self-regulating bodies. (14) (i) The regulator shall issue guidelines incorporating the requirements of sub-rules (1) to (13) above and may prescribe enhanced or simplified measures to verify the client s identity taking into consideration the type of cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssistants, semi-qualified and other assistants who may be engaged by such accountant) shall be paid in accordance with the amount specified in sub-rule (2) of rule 14B of the Income-tax Rules, 1962 for every hour of the period as specified by the Director. (2) The period referred to in sub-rule (1) shall be specified in terms of the number of hours required for completing the report. (3) The accountant referred to in sub-section (1A) of section 13 of the Act shall maintain a time sheet and submit it to the Director, along with the bill. (4) The Director shall ensure that the number of hours claimed for billing purposes is commensurate with the size and quality of the report submitted by the accountant. [Notification No. 12/2013/F.No.P.12011/1/2013-SO(ES(Cell)] BIPLAB KUMAR NASKAR, Under Secy. Note :- The principal rules were published in Gazette of India, Extraordinary, Part-II, Section 3, Sub-Section (i) vide number G.S.R. 444 (E), dated the 1st July, 2005 and subsequently amended by number G.S.R. 717 (E), dated the 13th December, 2005, number G.S.R. 389 (E), dated the 24th May, 2007, number G.S.R. 816 (E), dated the 12th November, 2009, number G.S.R.76 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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