I .

Philippine AMLA (Anti-Money Laundering Act)

II. USSC Compliance
III. Western Union Compliance
IV. Fraud & Security

I. Phil. AMLA
History of AMLA and its Amendments
Republic Act (RA) No. 9160

Also known as the Anti-Money Laundering Act of 2001. This act defines the crime of
money laundering, providing penalties therefor and for other purposes. This also created
the Anti-Money Laundering Council (AMLC) as the Financial Intelligence Unit (FIU) in the
Philippines.
RA 9160 was passed mainly because the Paris-based Financial Action Task Force (FATF)
had included the Philippines in an international blacklist of money laundering havens. This
made financial transactions and other business operations difficult in the Philippines. The
government complied, but left so many offenses beyond the reach of the Anti-Money
Laundering Council, including corruption, bribery and malversation of public funds.
This prompted the government to made amendments to the AMLA.
AMLA or RA9160 took effect on October 17, 2001.

Salient Features

Criminalizes money laundering

Creates a financial intelligence unit in the Philippines (AMLC)
Defines Covered Institution (CI)
Listed Unlawful Activities or Predicate Crimes
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 Imposes requirements on customer identification, record keeping, reporting of covered

and suspicious transactions
Provides for international cooperation

Role of AMLC

AMLC - Anti-Money Laundering Council

The function of AMLC, among others.
issue and implement rules, regulations, resolutions and orders
require and receive covered or suspicious transaction reports from covered
institutions;
investigate all suspicious and covered transactions after an investigation by the
AMLC, money laundering activities and other violations of the AMLA, as
amended;
to institute civil forfeiture proceedings and all other remedial proceedings
through the Office of the Solicitor General;
works closely with other government authorities, investigative bodies and
financial intelligence units of other countries, including UN and the UN Security
Council.

The AMLC is composed of the following 3 major government financial regulatory

agencies:
Bangko Sentral ng Pilipinas (BSP)
- the Governor as the Chairman of AMLC
Securities and Exchange Commission (SEC) - the Chairman as member
Insurance Commission (IC)
- the Commissioner as member
The AMLC is assisted by a Secretariat tasked to implement the various directives of the
Council.

AMLA Amendments and related Republic Acts:

RA 9194 (March 23, 2003)
Amending RA9160, includes the following:

Lowering the threshold for Covered Transactions to P 500,000 from P4,000,000

Inclusion & defining Suspicious Transactions ( not included in RA9160 )
Defining and identifying additional Unlawful Activity
Authority of AMLC/BSP to inquire into Bank deposits
And several other sections of RA9160

RA 10167 (Jul 2012)

Amending specifically Sections 10 & 11 of RA9160 as Amended.
Sec 10: Freezing of Monetary Instrument or Property
Sec 11: Authority to Inquire into Bank Deposits - providing more authority to AMLC/BSP
in inquiring into bank deposits
RA 10168 (Jul 2012)
An Act defining the crime of financing terrorism, providing penalties therefor and for other
purposes. Otherwise known as The Terrorism Financing Prevention and Suppression Act of
2012.

ATC

- Anti-Terrorism Council refers to the Council created by virtue of RA no. 9372,

otherwise known as the Human Security Act (HSA) of 2007.
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RA 10365 (Mar 7, 2013)

An Act further strengthening RA9160 as amended.
o Amended Covered Institutions to Covered Persons and adding new covered
persons
o Expanded definition of money laundering
o Increased of unlawful activities or predicate crimes to money laundering from 14
to 34.

New predicate crimes, among others, includes:

Hijacking, destructive arson and murder

Terrorism and conspiracy to commit terrorism
Financing of terrorism
Bribery and corruption of public officers
Malversation of public funds and property
Fraud and illegal transactions
Counterfeiting
Human Trafficking
Carnapping
Photo and Video Voyeurism
Child Pornography
Child Abuse, Exploitation and Discrimination
Violations of Environmental Codes

Terrorism
and
financing
terrorism

Hijacking,
Carnapping,
Murder, etc.

Bribery and
corruption of
public officers

Violations of
Natural
Resources &
Environmental
codes

Child abuse,
pornography
and
exploitation

What is Money Laundering?

Its a crime whereby the proceeds of an unlawful activity (as defined in the AMLA), are
transacted or attempted to be transacted to make them appear to have originated from
legitimate source.

Amended definition:
Section 4 of the same Act was amended to read as follows:
Money Laundering is committed by any person who, knowing that any monetary
instrument or property represents, involves, or relates to the proceeds of any unlawful
activity:
a. Transact said monetary instrument or property;
b. Converts, transfers, disposes of, moves, acquires, possesses or uses said monetary
instrument or property;
c. Conceals or disguises the true nature, source, location, disposition, movement or
ownership of or rights with respect to said monetary instrument or property;
d. Attempts or conspires to commit money laundering offenses referred to in
paragraphs (a), (b) or (c);
e. Aids, abets, assists in or counsels the commission of the money laundering offenses
referred to in paragraph (a), (b) or (c) above; and
f. Performs or fails to perform any act as a result of which he facilitates the offense of
money laundering referred to in paragraph (a), (b) or (c) above.
Money Laundering is also committed by any covered person who, knowing that a covered
or suspicious transaction is required under this Act to be reported to the Anti-Money
Laundering Council (AMLC), fails to do so.

Three (3) stages of Money Laundering.

1. PLACEMENT

the stage where the proceeds of an illegal activity dirty money initially enters the
financial system, such as with banks and other financial institutions that includes
money remittance entities.

2. LAYERING

putting transactions layer after layer on top of each other to hide the connection
between the dirty money, the illegal activity and the criminals who are profiting
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from the unlawful activity. The dirty money is moved around across many
businesses and institutions to make it look like an ordinary or legitimate
transaction. The purpose of which is to eliminate the trail of the dirty money. This
process becomes almost impossible to trace back where it came from.
3. INTEGRATION

the final stage where the dirty money, now clean, is back to the criminal or the
money launderer and re-introduces the money to the legitimate economy by
purchasing real estate, luxury goods, investing in a company, businesses, etc.

Covered Institution/Person (CI/CP)

Who and why USSC is a Covered Institution?
Covered Institutions amended as Covered Persons, natural or juridical, under RA 10365.
USSC was considered a Covered Institution/Person due to its products/services offered
that fall under RA 9160 Sec 3(a) as amended and RA 10365 Sections 1(a)(1), and BSP
Circular 706 that read as follows:
RA10365 Sec 1(a)(1) banks, non-banks, quasi-banks, trust entities, foreign exchange
dealers, pawnshops, money changers, remittance and transfer companies and
other similar entities and all other persons and their subsidiaries and affiliates
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supervised or regulated by the Bangko Sentral ng Pilipinas (BSP).

BSP Circular 706 series of 2011 Section X802 - further expands Covered Institution or
Person to include non-stock savings and loan associations, electronic money
(E-Money) issuers and other financial institutions which under special laws are
subject to BSP supervision and/or regulation.

Registration (BSP Circular 471)

Section 1 - Qualified persons or non-bank institutions wishing to act as foreign exchange
dealers (FXDs) / money changers (MCs) and /or remittance agents (RAs) are
required to register with the Bangko Sentral ng Pilipinas (BSP) before they
operate such.
RAs shall refer to persons or entities that offer to remit, transfer or transmit
money on behalf of any person to another person and/or entity. These include
money or cash couriers, money transmission agents, remittance companies and
the like.

Sale and Purchase of Foreign Currencies by FXDs/MCs

Section 5 - The following minimum procedures shall be observed on sale and purchase of
foreign currencies by FXDs/MCs:
a. Official receipts, in case of sales, and accountable forms in case of purchases,
shall be issued in numerical order to evidence sale/purchase of foreign
currencies;
b. The amount of foreign currencies sold shall be indicated in the official receipts
both in words and in figures. The staff serving the particular transaction as well
as the person buying/selling foreign currency shall sign in their usual signatures
on the receipt;
c. A Daily Record of Foreign Exchange Transactions shall be maintained where all
foreign exchange sale and purchase transactions shall be posted
chronologically. The Daily Record shall be kept on file at the FXD/MC premises
and shall be available for AMLC inspection/examination any time;
d. All copies of cancelled receipts shall be marked and stamped CANCELLED for
internal control purposes; and

e. Foreign exchange transactions shall be conducted only at the entitys principal

place of business and other authorized branches.

UNLAWFUL ACTIVITY (Rule 3.i)

Refers to any act or omission or series or combination thereof involving or having direct relation,
to the following:

Unlawful Activities or Predicate Crimes

1.

Kidnapping for
Ransom

13. Terrorism and

Conspiracy to commit
Terrorism

25. Carnapping

26. Illegal/Unlawful
Possession, Manufacture,
Dealing In, Acquisition or
Disposition of Firearms,
Ammunition or Explosives

2.

Dangerous Drugs

14. Financing of Terrorism

3.

Graft and Corrupt

Practices

15. Bribery and Corruption

of Public Officers

4.

Plunder

5.

Robbery and
Extortion

16. Frauds, Illegal

Exactions and
Transactions
17. Malversation of Public
Funds and Property

6.

Jueteng and Masiao

(Illegal Gambling)

18. Forgeries an
Counterfeiting

29. Violation of Intellectual

Property Code of the
Philippines
30. Photo & Video
Voyeurism

7.

Piracy on the High

Seas

19. Trafficking in Persons

31. Child Pornography

8.

Qualified Theft

20. Violation of the

Revised Forestry Code

32. Child Abuse, Exploitation

and Discrimination

9.

Swindling

21. Violation of the Phil.

Fisheries Code

33. Fraudulent Practices and

Violation of Securities
Regulation Code

22. Violation of Philippine

Mining Act

34. Felonies or offenses of a

similar nature that are
punishable under the
penal laws of other

10. Smuggling

27. Fencing
28. Violation of Migrant
Workers and Overseas
Filipinos Act

countries
11. Violation of Electronic
Commerce Act
12. Hijacking, Destructive
Arson and Murder,
including those
perpetrated against
non-combatant
person (terrorist acts)

23. Violation of Wildlife

Resources Conservation
and Protection Act
24. Violation of National
Caves and Cave
Resources
Management
Protection Act

Customer
Refers to any person or entity that keeps an 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. It includes any insurance policy holder, whether actual or prospective.

Beneficial owner
Refers to a natural person(s) who ultimately owns or controls the account and/or the
person on whose behalf a transaction is being conducted. It also includes those persons
who exercise ultimate effective control over a legal person or arrangement.

Politically Exposed Person (PEP)

Refers to a natural person who is or has been entrusted with prominent public positions
in the Philippines or in a foreign State, including heads of state or 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.

Terrorist

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Types of Transactions:

1. Covered Transaction - is a single transaction in cash or other equivalent monetary

instrument involving a total amount in excess of five hundred thousand pesos
(Php500,000.00) within one (1) banking day.

2. Suspicious Transaction - is a transaction, regardless of amount, where any of the

following circumstance exists: (RIRRs Rule 3.b.1)
(a) there is no underlying 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 any money
laundering activity or offense under this act (AMLA as amended) that is about
to be, is being or has been committed; or
(g) any transaction that is similar, analogous or identical to any of the foregoing.

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Other Suspicious Transaction under RA10168 otherwise known as TF Suppression Act

Rule 3.a.15

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What is required from a customer, responsibility of the Covered Institution, and

Sanctions?
1. Customer Identification (Rule 9.1.a-b)
VALID photo-bearing identification document for financial transactions.
Know Your Customer (KYC). Covered institutions shall establish and record the true
identity of its clients based on official documents. They shall maintain a system of
verifying the true identity of their clients and, in case of corporate clients, require a
system of verifying their legal existence and organizational structure, as well as the
authority and identification of all persons purporting to act on their behalf. Covered
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institutions shall establish appropriate systems and methods based on internationally

compliant standards and adequate internal controls for verifying and recording the true
and full identity of their customers.
BSP Circular No. 608 series of 2008 further amended by No. 657 series of 2009,
specifies that, clients who engage in a financial transaction with covered institutions for
the first time shall be required to present the original and submit a clear copy of at least
ONE (1) valid photo-bearing identification document issued by an official authority.
The term Official Authority shall refer to any of the following:
1.
2.
3.
4.

Government of the Republic of the Philippines

its political subdivisions and instrumentalities
government-owned and/or controlled corporations (GOCCs)
private entities or institutions registered with or supervised or regulated either
by the Bangko Sentral ng Pilipinas (BSP) or Securities and Exchange
Commission (SEC) or Insurance Commission (IC).

Although BSP Circular 608 listed valid photo-bearing IDs, Western Union identified the
following as acceptable IDs (in consideration of FRAUD):

PASSPORT (Local or Foreign issued)

DRIVERS LICENSE
PROFESSIONAL REGULATION COMMISSION (PRC) ID
INTEGRATED BAR OF THE PHIL (IBP) ID
NATL BUREAU OF INVESTIGATION (NBI) CLEARANCE
POLICE CLEARANCE CERTIFICATE (ELECTRONIC)
POSTAL ID
VOTERS ID (LATEST/NEW)
GOVT SERVICE & INSURANCE SYSTEM (GSIS) e-CARD
SOCIAL SECURITY SYSTEM (SSS) CARD
SENIOR CITIZEN CARD
OVERSEAS WORKERS WELFARE ADMINISTRATION (OWWA)
CERTIFICATION FROM NATL COUNCIL FOR THE WELFARE OF DISABLED PERSONS
(NCWDP)
OFW ID
SEAMANS BOOK
ALIEN CERTIFICATION OF REGISTRATION/ IMMIGRANT CERTIFICATE OF
REGISTRATION
FIREARMS LICENSE
EMPLOYMENT ID (GOVT & PRIVATE)
STUDENT ID (FOR MINOR/NON-VOTING AGE STUDENT ONLY)
OTHER IDs ISSUED BY THE GOVT & ITS INSTRUMENTALITIES (DIGITIZED HARD
PLASTIC TYPE)

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Note:
MNLF ID is not considered a valid ID pursuant to BSP Circular Nos. 608 & 657
(BSP clarification Sep 2009)
Minor customers (below 18 years old) are not allowed to send money.

Additional Acceptable IDs for WU transactions.

WU accepts the following non-digitized photo ID only for DMT transactions and
customers has not received/sent more than PHP3,000 in a month. (Refer to added
WU controls)

Barangay Clearance/Certification
DSWD Certification
TIN Card
Homeowner/Village Associations ID
Philhealth ID
Other IDs issued by the govt & its instrumentalities (non-digitized hard plastic
type)

2. Minimum Information/Documents Required for Individual Customers.

(Rule 9.1.c)
1.
2.
3.
4.
5.
6.
7.
8.

Name
Present Address
Permanent Address (if different from the present address)
Date and Place/Country of Birth
Nationality
Occupation/Nature of work and name of employer/business
Contact Numbers
Tax Identification Number, Social Security Number or Government Service and
Insurance System Number, if any
9. Specimen Signature
10. Source of Funds / (Source of foreign currency/ies or purpose of purchase for
FX/MC business)
11. Names of and relationship with beneficiary/ies (BSP Cir 471)

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3. Minimum Information/Documents Required for Corporate and Juridical

Entities. (Rule 9.1.d and BSP 706 RuleX806.2.b)
1. Certificates of Registration issued by the DTI for single proprietors, or by the
SEC for corporations and partnerships, and by the BSP for money changers,
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;
5. Latest General Information Sheet which list the names of
directors/trustees/partners, principal stockholders owning at least 20% of the
outstanding capital stock and primary officers such as President and Treasurer;
6. Contact numbers of the entity and authorized signatory/ies;
7. Source of fund 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;
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.

(For WU purposes, Business Information Sheet has to be filled-out and attached

supporting documents)

Business Information Sheet

*Legal Name of Business
Trade Name Doing
Business as (DBA)
*Official Address or
Principal Business
Address
*List of Directors/Partners

City

Province

Fax

Tax identification
No.
E-mail address

Zip

*Beneficial owners, if any

*Contact Numbers
Contact Name and Title
of Business Contact
(Authorzied person to do
business with WU)
Type of Business
*With the following
documents

Website addresss
Articles of Incorporation

Articles of Partnership

By-laws

List of pricipal stockhoders owning at least two

percent (2%) of the capital stock

Board Resolution
DTI Registration

Signature (Sole Proprietor, Partners, President, or

CEO):

Business Permit
* BSP Requirement per Rule 9.1 of the RIRR R.A. No.9160, as amended by R.A. No. 9194
**If USD15,001 and above, please use the LPMT Form

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4. Minimum Validation Procedures (BSP Circular 706 Sec. X806.1.c)

Validation procedures for individual customers shall include but is not limited to
the following:
1. Confirming the date of birth from a duly authenticated official document;
2. Verifying the permanent address through evaluation of utility bills, bank or
credit card statement or other documents showing permanent address or
through on-site visitation;
3. Contacting the customer by phone, email or letter ( such as sending of thank
you letters); and
4. Determining the authenticity of the identification documents through
validationof its issuance by requesting a certification from the issuing
authority or by any other means.
For corporate or juridical entities, validation procedures shall include but not
limited to the following:
1. Requiring the submission of audited financial statements conducted by a
reputable accounting/auditing firm;
2. Inquiring from the supervising authority the status of the entity;
3. Obtaining bank references;
4. On-site visitation of the company; and
5. Contacting the entity by phone, email or letter ( such as thank you letters)

5. Additional Requirement for FXDs/MCs ( BSP Cir 652 amending Section 7 of

BSP Cir 471 )
Section 1. FXDs/MCs shall require an accomplished application form and
submission/presentation of supporting documents listed in Item A of Annex
D for the sale of foreign exchange in the amount exceeding USD10,000 or its
equivalent for non-trade current account purposes.
For the sale of foreign exchange for all other purposes, FXDs/MCs shall
require submission of an accomplished application form and supporting
documents listed in Items B, C and D of Annex D regardless of the amount
involved.

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Section 2. The supporting documentary requirements under Annex D of Circular 471

shall be replaced by the following:

19

20

21

22

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6. Face-to-Face Contact (Rule 9.a.7 of RIRR and Section X806.1.e of Circular 706
or UARR)

No new accounts shall be opened and created without face-to-face contact

and full compliance with the requirements under Rule 9.a.3 (or Minimum
Information/Documents Required for Individual Customer), and personal
interview between the CIs duly authorized personnel and the potential
customer except under the following arrangements:
a. Account opened through trustee, agent, nominee or intermediary the CI
shall establish and record the true identity and existence of such trustee, etc.
b. Outsourcing Arrangement - CI shall ensure that the counter-party conducting
face-to-face contact undergo equivalent training program and likewise
monitor & review annually their performance.
c. Third Party Reliance - CI may rely on the representation of the third party
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that it has already conducted face-to-face contact provided that the pertinent
requirements in Rule X806.2.e.1 are also met.

7. Enhanced Due Diligence (EDD)

RIRR Rule 9.a.9.a and BSP Circular 706 Sections X806.1.b and X806.3.a
Covered Institution shall apply enhanced due diligence on its customers that are assessed
or these Rules as high risk for money laundering and terrorist financing. In addition to
covered institutions customer acceptance policy or minimum information in accordance
with AMLA and its RIRR, it acquires information in the course of its customers account
or transaction monitoring that:
1. Raises doubt as to the accuracy of information or document provided or the
ownership of the entity.
2. Justifies re-classification of the customer from low or normal risk to high risk
pursuant to these Rules or by its own criteria; or
3. Indicates that any of the circumstances for the filing of a suspicious
transaction exists such as but not limited to the following:
a. Transacting without any underlying legal or trade obligation, purpose
or economic justification;
b. Transacting an amount that is not commensurate with the business or
financial capacity of the customer or deviates from his profile;
c. Structuring of transactions in order to avoid being the subject of
covered transaction reporting; or

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d. Knowing that a customer was or is engaged or engaging in any

unlawful activity as herein defined.
Enhanced diligence, at a minimum, should observe the following measures;
1. Obtain senior management approval for establishing or continuing (for
existing customers) such business relationships;
2. Take reasonable measures to establish the source of wealth and source of
funds; and
3. Conduct enhanced ongoing monitoring of the business relationship.
Where additional information cannot be obtained, or any information or document
provided is false or falsified, or result of the validation process is unsatisfactory, the
covered institution shall immediately refrain from further conducting business
relationship with the customer without prejudice to the reporting of a suspicious
transaction to AMLC when circumstances warrant.

8. Reporting of Covered & Suspicious Transactions (Rule 9.3)

Covered Institutions shall report to the AMLC all covered transactions and suspicious
transactions (CTR & STR) within five (5) working days from occurrence thereof, unless the
supervising authority concerned prescribes a longer period not to exceed ten (10) working
days.
Should a transaction be determined to be both a covered and suspicious transaction,
the covered institution shall report the same as suspicious transaction.
The CTR & STR shall be submitted to the AMLC in a secured manner, in electronic form
and in accordance with the reporting procedures prescribed by the AMLC. The covered
institution shall provide complete and accurate information of all the mandatory fields
required in the report.
In order to provide accurate information, the covered institution shall regularly update
customer identification information at least every three (3) years.

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Confidentiality Provisions
When reporting covered transactions or suspicious transactions to the AMLC,
covered institutions and their officers and employees, are prohibited from
communicating, directly or indirectly, in any manner or by any means, to any
person, entity, the media, the fact that a covered or suspicious transaction
report was made, the contents thereof, or any other information in relation
thereto. Neither may such reporting be published or aired in any manner or form
by the mass media, electronic mail, or other similar devices. In case of violation
thereof, the concerned officer, and employee, of the covered institution, or
media shall be held criminally liable.

Safe Harbor Provisions

No administrative, criminal or civil proceedings, shall lie against any person for
having made a covered transaction report OR A SUSPICIOUS transaction report
in the regular performance of his duties and in good faith, whether or not such
reporting results in any criminal prosecution under this Act or any other
Philippine law.

9. Record Keeping (Rule 9.2 of RIRR)

All records of transactions of covered institutions (CI) shall be maintained and safely
stored for five (5) years from the dates of transactions. Said records and files shall contain
the full and true identity of the owners or holders of the accounts involved in the covered
transactions and all other customer identification documents.
Covered Institution shall undertake the necessary adequate security measures to ensure
the confidentiality of such file.
Covered Institution shall prepare and maintain documentation, in accordance with the
aforementioned client identification requirements, on their customer accounts,
relationships and transactions such that any account, relationship or transaction can be
so reconstructed as to enable the AMLC, and/or the courts to establish an audit trail for
money laundering.

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Exception to the 5 year retention period ( Rule 9.2.d)

If a money laundering case based on any record kept by the covered institution
concerned has been filed in court, said file must be retained beyond the period
stipulated in the three (3) immediately preceding sub-Rules as the case may be,
until it is confirmed that the case has been finally resolved or terminated by the
court.
Form of Records (Rule 9.2.e of RA9194 RIRR)
Records shall be retained as originals in such forms as are admissible in court
pursuant to existing laws and the applicable rules promulgated by the Supreme
Court.

10. Penalties of the Crime of Money Laundering (Rule 14.1 of RIRRs)

Section 4 (a) of the AMLA. 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 .
Imprisonment ranging from seven (7) to fourteen (14) years and a fine of not less
than Three Million Pesos (Php3, 000,000.00) but not more than twice the value of
the monetary instrument or property involved in the offense, shall be imposed
upon a person convicted under this Section.

Section 4 (b) of the AMLA. 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 (a) above
Imprisonment from four (4) to seven (7) years and a fine of not less than One
Million Five Hundred Thousand Pesos (Php1, 500,000.00) but not more than Three
Million Pesos (Php3, 000,000.00) upon a person convicted under Sec 4 (b).
Section 4 (c) of the AMLA - Any person knowing that any monetary instrument or
property is required under this Act to be disclosed and filed with the Anti-Money
Laundering Council (AMLC), fails to do so."
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Imprisonment from six (6) months to four (4) years or a fine of not less than One
Hundred Thousand Pesos (Php100,000.00) but not more than Five Hundred
Thousand Pesos (Php500,000.00), or both. (Failure to report covered or suspicious
transactions to AMLC)
Administrative Sanctions.
- After due notice and hearing, the AMLC shall, at its
discretion, impose fines upon any covered institution , its officers and employees or any
person who violates any of the provisions RA9650, as amended by RA 9194 and rules,
regulations, orders and resolutions issued pursuant thereto.
In no case shall such fines be less than One Hundred Thousand pesos
(P100,000.00) but not to exceed Five Hundred Thousands Pesos (P500,000.00).
The imposition of the administrative sanctions shall be without prejudice to the
filing of criminal charges against the persons responsible for the violations.

Failure to Keep Records. - The penalty of imprisonment from six (6) months to one (1)
year or a fine of not less than One Hundred Thousand Philippine Pesos
(Php100,000.00) but not more than Five Hundred Thousand Philippine Pesos
(Php500,000.00), or both.

Penalties for Malicious Reporting. - Penalty of six (6) months to four (4) years
imprisonment and a fine of not less than One Hundred Thousand Philippine Pesos
(Php100, 000.00) but not more than Five Hundred Thousand Philippine Pesos
(Php500, 000.00), at the discretion of the court: Provided, That the offender is not
entitled to avail the benefits of the Probation Law.
Sec.9 (c). Malicious Reporting - Any person who, with malice, or in bad faith,
reports or files a completely unwarranted or false information relative to
money laundering transaction against any person.

Offender is a Juridical Person. - If the offender is a corporation, association,

partnership or any juridical person, the penalty shall be imposed upon the
responsible officers, as the case may be, who participated in, or ALLOWED BY
THEIR GROSS NEGLIGENCE the commission of the crime.
If the offender is a juridical person, the court may suspend or revoke its license.

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If the offender is an alien, he shall, in addition to the penalties herein prescribed,

be deported without further proceedings after serving the penalties herein
prescribed.
If the offender is a public official or employee, he shall, in addition to the penalties
prescribed herein, suffer perpetual or temporary absolute disqualification from
office, as the case may be.
Refusal by a Public Official or Employee to Testify. - Any public official or employee
who is called upon to testify and refuses to do the same or purposely fails to
testify shall suffer the same penalties prescribed herein.
Penalties for Breach of Confidentiality. - The punishment of imprisonment ranging from
three (3) to eight (8) years and a fine of not less than Five Hundred Thousand
Philippine Pesos (Php500,000.00) but not more than One Million Philippine
Pesos (Php1,000,000.00), shall be imposed on a person convicted for a violation
under Section 9(c). IN CASE OF A BREACH OF CONFIDENTIALITY THAT IS PUBLISHED
OR REPORTED BY MEDIA, THE RESPONSIBLE REPORTER, WRITER, PRESIDENT,
PUBLISHER, MANAGER AND EDITOR-IN-CHIEF SHALL BE LIABLE UNDER THIS ACT.

BSP Rules of Examination. - (Rule 11.3.a) The BSP shall promulgate its rules of
examination for ensuring compliance by banks and non-bank financial institutions
and their subsidiaries and affiliates with the AMLA and these rules.
Any findings of the BSP which may constitute a violation of any provisions of this
act shall be transmitted to the AMLC for appropriate action.
Rule of Procedure Governing Admin Investigations by the AMLC Secretariat
(Adopted by AMLC in Jul 2007)
The Rule shall apply to all investigations concerning covered institutions and
their personnel in cases of:
1. Violations of the provisions of the AMLA, as amended, and its implementing
rules on:
a.
b.
c.
d.

customer identification and due diligence;

record keeping
reporting of covered and suspicious transactions; and
duty of covered institution upon receipt of freeze order or AMLC
Resolution authorizing inquiry;
30

2.
3.
4.
5.

Malicious reporting
Breach of confidentiality
Other violations of the AMLA, as amended, and its implementing rules; and
Violation of issuances, orders and resolutions issued by the AMLC

11. Money Laundering Prevention Programs. ( Rule 17.2 )

Rule 17.2.a. Covered institutions shall formulate their respective money laundering
prevention programs in accordance with Section 9 and other pertinent provisions of the
AMLA and these Rules, including, but not limited to, information dissemination on money
laundering activities and their prevention, detection and reporting, and the training of
responsible officers and personnel of covered institutions, subject to such guidelines as
may be prescribed by their respective supervising authority.
Every covered institution shall submit its own money laundering program to the
supervising authority concerned within the non-extendible period that the supervising
authority has imposed in the exercise of its regulatory powers under its own charter.

Rule 17.2.b. Every money laundering program shall establish detailed procedures
implementing a comprehensive, institution-wide "know-your-client" policy, set-up an
effective dissemination of information on money laundering activities and their
prevention, detection and reporting, adopt internal policies, procedures and controls,
designate compliance officers at management level, institute adequate screening and
recruitment procedures, and set-up an audit function to test the system.

Rule 17.2.c. Covered institutions shall adopt, as part of their money laundering programs,
a system of flagging and monitoring transactions that qualify as suspicious transactions,
regardless of amount or covered transactions involving amounts below the threshold to
facilitate the process of aggregating them for purposes of future reporting of such
transactions to the AMLC when their aggregated amounts breach the threshold.

12. Training of Personnel. - ( Rule 17.3 of RIRR ).

Covered institutions shall provide all their responsible officers and personnel with
efficient and effective training and continuing education programs to enable them to fully
comply with all their obligations under the AMLA and these Rules.

31

BSP Circular 706: (Authority of BSP under RIRR Rule 17.1.b)

One of the primary task of Compliance Office is to organize the timing and content of AML
training of officers and employees including regular refresher trainings, in accordance
with Sec X809 (or below):

Section X809. AML Training Program Covered institutions shall formulate an annual AML training program aimed at
providing all their responsible officers and personnel with efficient, adequate and
continuous education program to enable them to fully and consistently comply
with all their obligations under these Rules, the AMLA, as amended, and its RIRR.
Trainings of officers and employees shall include awareness of their respective
duties and responsibilities under the MLPP particularly in relation to the customer
identification process, record keeping requirements and CT and ST reporting and
investigation of suspicious and money laundering activities.
The program shall be designed in a manner that will comprise of various focuses
for new staff, front-line staff, compliance office staff, internal audit staff, officers,
senior management, directors and stockholders.
Regular refresher trainings shall likewise be provided in order to guarantee that
officers and staff are informed of new developments and issuances related to the
prevention of money laundering and terrorism financing as well as reminded of
their respective responsibilities vis--vis the covered institutions processes,
policies and procedures.
Covered institutions annual AML training program and records of all AML
seminars and trainings conducted by the covered institution and/or attended by
its personnel (internal or external), including copies of AML seminar / training
materials, shall be appropriately kept by the compliance office / unit /
department, and should be made available during periodic or special BSP
examination.

32

In compliance with RA9160 (or AMLA), as amended, and its revised implementing rules
and regulations (RIRR), below are internal requirements/processes adopted:

1. Customer Identification (KYC)

CIF (Customer Information File)
Is the internal on-line customer information system that captures/records the
customer data as required by law, including specimen signature and copy
(scanned copy) of valid ID. This will represent USSCs compliance with Rule 9.1,
Customer Identification Requirements, of RA 9160, as amended.
Any incomplete CIF of a customer will be the responsibility & accountability of
the branch personnel and liable for non-compliance with the law. A report and
memo will be issued by HR for infraction and penalty will apply.
PanaloKard (PK) Application Form
This serves as the original document of customer information of every USSC
customer availing any of its products, whether covered by AMLA or not. Customer
is required to fill out this form for the purpose of assigning a PK number for easy
reference and other internal purposes.
When a customer avail products covered by AMLA, like WU, Public FOREX, Cash
Master/Cash Card, Panalo Wallet and any other future products covered by AMLA,
he/she must completely & correctly fill out the mandatory information.
Photocopy/Scanned Copy of ID (refer to CIF guidelines)
Photocopy of presented valid ID of customers shall be kept by the location.
1. Scan the valid ID using the printer scanner of the location and upload to CIF.
2. If the branch scanner is encountering error or power outage in the branch only,
have the ID photocopied in a nearby copier store and file the hard document.
Once the scanner is up, scan the photocopy of the ID and upload to CIF.
33

3. For extreme cases when brownout is encountered in the area/locality, you may
use your cell phone to take a picture of the ID. Make sure to completely capture
the full ID.
Once power is normalize, transfer the ID photo to your computer and
upload to on-line CIF.
4. Print hard copy of every ID type presented once and attached to the PK
application form of each customer and file. This is necessary to make sure we
have the copy of ID anytime especially during brownout, no connection or
on-line CIF is down or defective.

Hard copies of PK (CIF) form and photocopy of ID.

Retain and file in the store location all original hard copies of PK form (CIF)
filled out by each customer.
Photo or scanned copy of every ID type presented or renewed ID shall be
printed once and file attached to the PK form of the customer.
This is necessary as immediate reference by FLA/branch and in compliance
with the law in case our on-line CIF is off-line, down or defective.

2. Record Keeping
Transaction documents of each product shall be kept by the location within 5 years from
date of transaction, except for transaction when a case in filed in court that the
documents will be kept longer until the case has been terminated/closed. Documents to
keep as follows:
a. WU - To Send Money (TSM), To Receive Money (TRM), Automated Cash Receipt (ACR)
Small Sheet.
b. Public FOREX - Foreign Currency Transaction Slip (FCTS), Foreign Currency Conversion
Slip (FCCS) and additional documents required for more than USD10,000 or
equivalent.
c. Panalo Wallet Cash-in transaction receipt, Cash-out transaction receipt,
Supplementary form and Amendment form of customer information and or any
updated transaction form
34

d. Cash Master and Cash Card Cash Master Application form (or PK form), Loading Slip,
and Gen. Cash Disbursement Receipt (GCDR) for over the counter payment.
For Cash Card, Card Application form, card loading slip (or any transaction
form) and GCDR if any/applicable.
e. All hard and soft copies of customer CIF or PanaloKard forms and IDs or KYC. Any
additional forms/documents required by law.
Index cards where customer info were recorded prior to the CIF (PK form)
with attached ID copy shall be kept at the store level for further
reference/supporting documents.
f. Refer to guidelines adopted and issued in 2014 for record keeping.

In case of calamity where a location is affected and the documents

covered within the retention period were lost due to fortuitous events:
Report immediately the affected documents with complete information such as:

location name & address

period affected
kinds of documents & estimate % of damage records

Use the template provided by WU

This is done in coordination with the GFAM or AM for them to certify and send
to Compliance office
This is for record purposes only in case BSP/AMLC & other govt authorities will request
the affected document/s. However, this is not a guarantee of compliance with Record
Keeping requirements.

3. KYC, Customer Enhanced Due Diligence (EDD) and Monitoring

FLA shall implement proper KYC (Know Your Customer) procedures in identifying the
customer and their transactions. If the FLA has doubt on the information and documents
provided, the FLA shall apply enhanced due diligence (EDD) by asking more questions or
35

gathering information and documents available and applicable. Relay information to

Compliance team any gathered data and/or activity by your customer that is deemed
suspicious.

Customer Profiling Aside from the minimum customer identification requirement,

FLAs are provided with below monitoring module to help them identify and
validate customers that are likely to pose low/normal or high risk to the
operations as well as the standards in applying reduced, average diligence to
enhanced due diligence.

UAMM ( USSC AML Monitoring Module)

The internal monitoring report/module, UAMM, is available in our internal
system i-Cash as reference of every FLA to check a WU customer name if
conducting suspicious transaction or unlawful activity.
The FLA before further processing a WU transaction must first go to UAMM and
check the name if in the list of the three (3) categories, Suspicious, EDD or
Blacklisted.
(1) SUSPICIOUS
Customers that transacted in our network generated by the system that
falls or match the three (3) criteria:
from many to one (various senders to one receiver);
from one to many (one sender to many receivers);
multiple one is to one (multiple transactions from one
sender to one receiver)
Under this category, customers may be classified as:
Low Risk Customers regular customers with normal and legitimate
transactions, reputable record and business relationship with USSC
has been established for a period of time. The volume (including
total amount) and frequency of his/her transactions remains
significantly the same on monthly or regular basis.
Although some customers has to be further reviewed and validated
if necessary when they match the above criteria.

36

Normal Risk Customers are customers tagged automatically by i-Cash

system as SUSPICIOUS following the system defined criteria
above.
FLAs would then be alerted proactively on the pattern of customer
transactions.
Any monitored/observed deviation from the normal or past
transaction must be reported to the Compliance Team for further
review and validation.
For Low and Normal Risk Customers, average due diligence is
being applied, wherein, the minimum KYC or required information
are being obtained.
What should FLA do?
a. Proceed to process the transaction but this is an advance information
to FLA that the customer is either conducting legitimate or illegal
transaction and is possibly required to provide additional information
or documentation in the next visit or classify the customer as
low/normal risk.
b. FLA can start applying due diligence, but do not inform the customer
he/she is being monitored.

(2) EDD (Enhanced Due Diligence)

Under this category, customers will be considered as potential HIGH Risk.
High Risk Customers are customers in the suspicious list identified
and tagged by Compliance team based on data available,
information provided by FLAs and/or WU, compliance review and
monitoring that needs additional information and/or
documentation to validate the monitored suspicious pattern of
activities associated with unlawful activities defined by AMLA, the
alleged purpose, relationship and others.

37

What should FLA do?

a. Proceed to process the transaction but FLA is now required to apply
enhanced due diligence to satisfy any doubt on customer activity.
b. FLA to further validate, apply risk profiling by asking probing questions
on the declared relationship, source of fund and/or purpose of
transaction, nature of business, etc. and request to provide
documents to validate the activity.
Do NOT inform customer that his/her name will be blocked if
he/she cannot provide additional data/document/s.
c. Ask to provide additional ID if necessary. The law allows a covered
institution/person to require a customer to provide additional ID when
the FLA is in doubt.
c. Customer is given 15 days from date of compliance tagging in UAMM
to provide information/documentation.
d. After 15 days and no data or document is provided, Compliance will
further request WU to interdict the customer.
Any extension beyond the 15-day period due to valid reason/s
must be relayed to Compliance for reference.
Such extension will be limited to Compliance defined number of
days but not to exceed additional 5 days based on the given valid
reason. After the additional 5 days and no response received,
Compliance will proceed for interdiction.

(3) BLACKLISTED
Customers tagged by Compliance under this category include those:
a. customers matching the WU Compliance rules, FRM (Fraud Risk Mgt)
and GSI (Govt Sanctions and Interdiction) RTRA ( Real Time Risk
Assessment)
b. identified and reviewed by USSC Compliance team and
confirmed/validated also by WU to be conducting illegal/unlawful
activities.

38

c. reported by FLAs that are using different names supported by various

ID types presented and any monitored suspicious activities that are
reviewed and approved by WU for interdiction .
FLAs that originally initiated/reported similar customer or
suspicious transaction activities that eventually approved for
interdiction by WU will be endorsed in the WU Eagle Eye award.
d. customers reported/provided by BSP/AMLC, NBI, Court, Interpol and
other govt/police authorities.
e. customers under international watch list available in the websites of
FATF (Financial Action Task Force), FSRB (FATF Style Regional Bodies
Group) like Asia Pacific Group on Money Laundering and the Egmont
Group, authorities like OFAC (Office of the Foreign Assets & Control)
of the US Dept of Treasury and the United Nations Sanctions List.
What should FLA do?
a. Customers under this category or blocked by the system, therefore
it cannot be paid/process further.
b. Inform the customer that his/her transaction is No Match Found.
c. If the transaction is still available in the WU system but customer is
positive identified/match against the watch list, tell the customer its
No Match Found.
Advise immediately Compliance team about such customer for
necessary immediate action.
d. FLA who will process transaction when customer is in the Blacklist
will be reported to HR for infraction and sanction.

More importantly, NO FLA will connive with any customer

conducting suspicious or unlawful activity/ies in exchange for any
commission or bribery. Avoid any complicity.
FLA should not rely only on UAMM reports:
a. Customers in the UAMM list are based only on the 3 defined criteria. The system
39

has no intelligence to identify, monitor and review other suspicious transactions

defined by AMLA, as amended, and its Revised Implementing Rules and Regulations
(RIRR).
b. Customers conducting other serious unlawful activities may have various schemes to
avoid easy detection. Some of these unlawful activities that customer may use
remittance, aside from child pornography/abuse/human trade/trafficking, are
proceeds from:

Drugs
Arms Sales/Gun Running
Smuggling
Terrorist activities
Kidnapping for Ransom
Gambling - (Jueteng and where countries do not allow such activity like
on-line sabong, etc.)
Qualified Theft - (Credit cards, ATM cards, bank accounts, etc)
Swindling/Fraud - (like sending money to someone unknown and various
scams)
Robbery & Extortion, among others.

c. How to identify suspicious transactions, in addition to the definition of the law?

FLA must apply due diligence to customers, on top of the normal or minimum KYC
on the following:
o sending /receiving large amount or structuring transactions below reporting
threshold (either within the branch or several locations)
o sending /receiving allegedly for business purpose but cannot provide any
supporting documents.
o sending /receiving in groups, two or more customers work together to avoid
requirements, or one customer seems to be dictated by the other
o sending /receiving to/from countries identified with high unlawful
activities, like Nigeria, UK, and identified terrorist countries
o customer changes story, nervous, in a hurry or sometimes so unreasonable
o refusal to provide ID, or cannot provide major govt issued ID in relation to
his/her status or alleged business while sending large amount (like SSS or
GSIS, Passport, DL, or Employment ID of the institution when alleged to
be an employee)
o splitting without any valid/legal/lawful reason/purpose
o the operator is asked to bend rules or offered bribe
o several transactions are conducted in one day within the branch or at
different locations, look at the size, frequency and nature of the
40

o
o

transactions
what is your experience with the customer, any pattern that deviate
from the past normal transactions? what are normal transactions for
the location or in the area? Is it more for family support or other business
transactions with legal existence, etc?
transacting with no apparent business, legal or trade obligation, lawful
purpose or economic justification, or related to unlawful activities
defined in the AMLA
same person/customer providing different names evidenced by the ID
types presented
No reasonable explanation

d. Common Indicators for human trafficking/cyberpornography/ cybersex or child

exploitation as defined in RA10365
o receiving from different male senders from different countries without
familial relationship
o relationship is FRIEND, BOYFRIEND, FIANCEE, and later becomes UNCLE,
BROTHER, AUNTIE, SISTER but no familial relationship or with foreign
name.
o met the senders through chat rooms, internet dating sites, etc.
o receiving multiple transactions, high frequency (multiple in a day or week)
with minimal amount, common usually between US$10-50 or less that
US$100 when using credit cards (due to some limit requirements).
o receivers are female teens, gay or homosexual, students, etc.
o receivers are sometimes elderly but coming from different senders from
different countries, especially from US, Canada, Australia, UK, and other
European & middle east countries.

4. Data Integrity
As the law requires true identity and information of customers, the FLA must
completely and correctly record all customer data applicable/required.
Ensure that all forms, such as WU TRM & TSM, PK forms and the on-line CIF, Public
FOREX forms, Panalo Wallet transaction forms, and Cash Master/Card forms, are
properly and completely filled out.
ID presented is valid, genuine, unexpired and data properly written in each
transaction form and posted/recorded in the system accurately to match every
single customer.
41

 Customers specimen signature in any form shall match the specimen signature in
the ID presented.
Never create false names, records or information. Never use or record an ID type
and personal data of another customer, FLA or guard, including address and
contact number of the branch, to a different and or several customers.

This is a violation and non-compliance with the AMLA, as amended, and its
RIRR.

For WU, this integrity issue is enough reason for WU NPC, when complaint
arises, to charge the FLA for Paid-In-Error.

FLAs shall NEVER advise customers on how to avoid identification (KYC),

record keeping or reporting requirements!

Damages the reputation of USSC, its officers , employees, and the business
It will hurt the community and the country
It will allow criminals and terrorist to use the financial system for illegal/unlawful
purpose
Penalizes the company and its officers/employees as a covered institution/person
for violation of AMLA

42

WU complies with the regulatory requirement of each country they are present or
representated by its Agents. This includes Phil. AMLA requirements discussed in the previous
pages.
While WU is being monitored by govt authorities especially in the US, WU is also
monitoring all customer and agent activities by their Compliance team like FIU ( Financial
Intelligence Unit), GMI ( Govt Monitoring and Interdiction) and FRM (Fraud Risk Management).
WU identified suspicious transactions based on their defined rules and patterns are
endorse to Agent concerned for further review and/or immediately suspend/blocks the
transaction/customer when classified to be potential high risk.

GEN III - Customer Data

Gen III functionality allows the data entered (encoded by FLA) into the Anti-Money
Laundering Compliance template (of the system) to be captured and stored. A
returning customers data will automatically populate the compliance fields when
specific information is entered.
The system performs a look up on 2 fields: ID Number and ID Type. If these fields
match with information (of customer) in the database, the compliance fields will be
automatically populated.
If no record is found on the database, the customer information will be encoded by
FLA in the compliance template and stored to the database for the customers next
visit.
This saves time and improves customer experience.

Restrictions & Limits

Country Restrictions are limits placed on international money transfers by law. The
restrictions may prohibit transfer completely, they may limit the amount of
amoney sent or received, or they may require a Test Question or consumer
identification.
No one may authorize any transaction above or outside these restrictions.
(always refer to F2ZOOM for restriction and requirement updates)
43

Agent Limits - one way WU limits financial risk is by limiting tranactions. Network
Agents also have the option to limit their own exposure, based on their risk
tolerance. Limits help to enforce legal restrictions that may exist in specific
countries. They also provide security for the Agent and for WU.
These two (2) types of limits are Daily Limits and Transaction Limits.
Daily Limit is a maximum amount an Agent can send per day. If the limit
is reached on any day, the Agent must call the Regional Operations
Center to continue operations for that day, or use Agent portal to
adjust limit.
Transaction Limit - is the maximum amount an Agent can send in one transfer.
The purpose of this limit is to alert Western Union Compliance to
large transactions and to enforce country restrictions. To request
an exception for a particular transaction, an Agent must contact
Western Union or use Agent portal to adjust limit.

Restrictions/requirements for Africa

All money transfers intended to African countries will require both a Test
Question (TQ) and a valid ID during payout. The FLA must include in the send
process a TQ and answer to the TQ.
The TQ should be an open probe, NOT a question with a YES or NO answer.
Specific for Nigeria
FLA must inform sending customer about the following mandatory
requirements:

MTCN to be provided by payee, effective Jun 5, 2006

Test Question (and answer)
Valid ID
Payee MUST be a bank account holder - effective 2010
In case the payee has no bank account, the payee may use a
person with existing bank accout as reference to confirm the identity of
the payee.

44

FLA must apply Enhanced Due Diligence required for Nigeria Outbound
Transactions (effective Sep 15, 2012)

45

LPMT Large Principal Money Transfer

46

This is the new LPMT threshold (US$15,000 or local equivalent)

implemented in Sep. 15, 2006 for APAC region (this includes Phil). Any
amount that exceeds the threshold is considered LPMT.

However, sent to South West Border (SWB) STATES in the US, LPMT
threshold is US$7,500 (effective Jun 20, 2013). SWB States includes
the following:
Arizona maximum allowed transaction amount per day is
US$450 (check F2ZOOM)
Texas
California
New Mexico

What is required?
o Fill out the LPMT form. Request customer to provide supporting
document/s relative to the purpose of transaction and send to MTOC/BOS.
o MTOC/BOS will send the documents to WU for approval. Any additional
document requested must be provided by the customer.
o Advise customer it will take some delay. Wait for WU instructions if
approved or not.
o If approved, proceed to process. If not, inform customer its a WU
compliance decission.

47

Examples of supporting documents:

48

LPMT form sample ( request the form from MTOC/BOS if your location did not
kept/saved a copy)

49

The agent with assistance from WU actively cooperates with all legitimate govt inquiries
& investigations. The WU system will screen or filter transactions for names identified
by relevant authorities.
When the system identifies this/these exact name/s that appears to match the given
watch lists published by govt authorities including the UN, the US Treasurys OFAC
(Ofc of Foreign Assets Control), the European Commission & the Monetary Authority of
Singapore, to name a few, the transaction will be suspended.
Under NO circumstances will a transaction be refunded to the sender or paid to the
payee as long as it remains suspended for review in the interdiction program.

Real Time Risk Assessment (RTRA)

Objectives:
processing of transactions (under intl watch list) in real time
protect WU & its agents against potential damage, penalties or
legal consequences
obtain complete & accurate information of customers to speed
up the validation process
Review Process:
If system cannot determine if false or true match, the transaction
will default to Fast Review queue for manual review by WU operator,
and message error will appear:
U2224 Under Review Wait 15 Minutes

WU operator determines its a false match, transaction will be

released to will call and becomes available in 15 mins.

WU operator determines its still a potential or exact match, the

WU operator will require from the agent copy of ID and
other information

50

WU operator determines its a true match, Govt Sanctions will

block the transaction & refunds the MT.
In such case, BOS (MTOC) or Compliance team, will notify the
sending location to refund the MT in full once the email
instruction is received.

Additional Error Codes during payout FLA to follow the instructions,

complete and accurate encoding of mandatory data or provide
any requested additional data/document.

Note:
RTRA rules for Suspicious Cyberpornography or cybersex activities is different from the above
RTRA for govt monitored unlawful activities.
1. WU system monitored transactions/customers that matches WU rules are
automatically blocked by the system and for refund to senders.
2. If a customer is affected by the WU rules but have a legitimate personal or business
transaction, customer has to fill-out the 3 pages KYC questionnaire prepared by
WU and provide documents to clear the customer name/transactions. Send to
Compliance for endorsent and approval of WU.
Below example form:
51

52

PROHIBITED TRANSACTIONS
Countries where Western Union is not presented
Transfer for gambling from/to the US and other countries that prohibits such
activity
Split transactions in general, for no valid reasons, when the purpose is to avoid
reporting or any violation of Anti-Money Laundering (AML) and its RIRRs.
However, if the purpose is due to a legitimate promotional activity/ies (lower
fees) or with limit of minimal principal amount per transaction to a destination
country/state and below the AML threshold or LPMT amount, this may be
allowed. (refer to F2ZOOM for updates and guidance in every destination
country)
Investment purposes purchase of stocks, bonds, mutual funds, etc.
Third Party transactions where the beneficial owner cannot be identified
Suspicious Transactions defined by AMLA

WU fulfill this commitment, in part, by complying with the laws that prohibits any of our
services from being used to transfer funds for the purpose of gaming either:
-

To or from the United States; or

To or from any country or territory that prohibits this activity

These are cross-border gambling activities, such as, internet casino type gambling, sports
betting and so-called sports information services.

Common gaming activity/transaction encountered in the Phil is on-line SABONG. Some

branches (in MM) were already warned by WU for possible suspension.

53

Below is a caption in the constant reminder letter from WU Compliance/Legal office:

Some countries that prohibits gambling/gaming activities: (always refer to F2ZOOM for
country updates)

54

(WU/USSC)
Location Security

Unique Operator ID and Password of employees

PC monitors not seen by customers
MTS (Money Tfer System) log out
Telephone transactions in a secure area
Do not allow unauthorized persons behind the counter
Reconcile daily to identify fraud or internal theft and report any
discrepancies
Forms must never be shown to a third party other than the
Sender or Receiver with the exception of specific requests
from the police, WU or other compliance authorities

Transaction Security

Do not discuss any aspect of WU business

Do not accept transactions over the telephone from unknown or
unauthorized.
Never provide callers with any MT information
No one from WU will ever call and ask for your Terminal ID,
Operator ID, or Password.
WU will never call you to input a money transfer or to correct a
problem on a previously sent transaction.
WU will never call you to test the system for any computer or
telecommunication problem.
WU will never call you to pay out a money transfer.

For SEND & PAY, always REMEMBER

Western Union, any officer of the co., any agent or anyone will NEVER call, text,
write or email directly an FLA/agent location instructing to or asking for:
send a money transfer
re-send a purged MT
reinstate a paid transaction
55

search a transaction
pay a valid transaction
reset your terminal ID, Optr Info & PC Signature
transaction details
operator & location information
WU traffic of the location, detailed procedures
any similar to the above with various reasons.

FRAUD WARNING:

System Security: from an unknown/unauthorized source, or

pretending to be a WU or USSC source;
NEVER
open an email
open or click on the attachment
execute or install the attachment
respond to the email, fax, letter or call
upload any file from CD, memory stick or USB, portable
hard drive
o download software to your PC
o any similar to the above
o
o
o
o
o

Always refer to SECURITY/FRAUD bulletins coming from WU

& USSC HO
Actual samples pretending to be from WU:

56

TYPES OF FRAUD
Consumer Fraud fraudulent activity that takes place outside
Western Union. Consumer fraud affects most banks and nonbank financial institutions.
Agent Fraud fraudulent activity committed by Western Union
Agents and its employees. Theft of funds (embezzlement),
Agent sent transactions w/o funds or divulged account
information, and misuse of MT system.
Fraud targeted at Western Union - Fraudulent activity targeted at
Western Union Phishing, Double dipping, Transfers sent
without funds.

Top Consumer FRAUD:

1. Online/Internet Auction Fraud/On-line Purchases
2. Lottery/Sweepstakes or Prize Fraud
3. Internet Banking Fraud
4. Corporate Identity Fraud
5. Advanced Fee Fraud/Job Placement Fee
6. Emergency or Destitute Fraud

Online Auction/Purchases

How well do you know the recipient in the receiving country?

Did they advise you on how to use Western Union?
Were you asked to use a family or friends name or fictitious name?
Have you verified the web site if genuine or not, like:
e-bay
sulit /OLX, etc

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LOTTERY/PRIZE Fraud
Did you ever purchase a lottery ticket?
Did you receive a text message that you won in an alleged raffle or promo?
Did you receive a letter/email pretending to be from WU about a consumer prize
of brand loyalty
No lottery company will ever ask you for upfront payment on winnings.
Have you tried using other resources to verify the company?

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INTERNET Banking Fraud

Bank accounts are compromised
Mules are recruited
Transfers are sent through Western Union
Your account has expired!

CORPORATE Identity Fraud

Did you receive an email claiming to be from Western Union?
Did the email ask you to send the money or product?
Did you verify the domain to ensure the validity of the email?
Western Union will never send you an email asking you to send money
westernunion.customerservices@anonymous.mail.com

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ADVANCE FEE Fraud & Job Placement Fee

customer received a notification stating that they have inherited money
from an unknown relative.
customer have receive notification of a business venture
offering millions of dollars in return.
customer looking for job abroad thru internet posting

EMERGENCY or DESTITUTE Fraud

Fraudster will call you and make you believe they are someone

you know
Pretending to be someone acting on behalf of an immediate family
member or relative
Pretends to be a doctor, police, military or Atty
Describes an urgent situation or emergency encountered by your
relative, friend or someone close to you
Requires you to send money very urgent
Be vigilant and advise/warn your sending customers about fictitious
transactions especially intended to:
NIGERIA & other AFRICAN countries
UK (United Kingdom)
MALAYSIA, etc.
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For the following reasons:

Unknown person/receiver for the order of merchandise, custom
duties or whatever reason
Sender itself, relative or friend as the payee while still in the
Phil for job placement, processing or documentation fees
processing fee or tax for winning of a promotional activity
whether local or intl not verified with DTI or foreign
country embassy, respectively
fictitious payee name to be changed later when goods are
received.

If the FLA suspects FRAUD and the Sender insist on sending, have the
customer sign the WAIVER form and file

NEVER provide promises, like money transfer cannot be claimed

without the MTCN, etc. Always referto F2ZOOM for requirements in
the destination country.
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AGENT FRAUD
o
o
o
o
o

Embezzlement or misappropriation
Transfers sent without funds
Transfers paid without customer present
Agent surfing the system
Duplication or emulation of Agents terminal

Misappropriation

System SURFING is strictly PROHIBITED

FRAUD Targeting WU
o Phishing collecting data/information, these are callers, emails,
web links claiming to be from WU
o Double Dipping attempts to collect funds twice: e.g. family
members, friends using the same name
o Transfers sent without funds
o Emulation of Agents terminal compromise of location info

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OTHER FRAUD REFERENCE/SOURCE OF INFORMATION

Fraud /Scams are constantly evolving to mislead and defraud a potential victim.
Updates of new schemes/current fraud trends are sometimes provided/available
to the public for awareness.
News - Newspapers, radio, TV, friends, relatives
Police reports
Websites of AMLC/BSP, DTI and other authorities, etc.

For WU customers, check WU public website:

https://www.wu.com/fraudawareness

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Police or Govt Authority Request Entertain by WU (coming from)

1. Anti Money Laundering Council (AMLC) /Govt Authorities
o Through WU AML & Compliance Department
o Money Laundering Cases
o Text Scams & other Consumer Fraud
2. National Bureau of Investigation (NBI)
o Consumer Fraud
o Case to Case Basis
3. Philippine National Police (PNP) / INTERPOL
o Consumer Fraud
o Case to Case Basis
Special Divisions

Anti Fraud &

Commercial Crimes
Division (AFCCD)

Anti Fraud &

Computer Crimes
Division (AFCCD)

INTERNATIONAL POLICE

REGL TRIAL COURT

AMLC

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Customer requesting POP, copy of ID or payout information of his/her send out due to
whatever reason/s must comply to provide a complete police report that contains the
following:
Veracity /Completeness of Request
Official Letterhead, if possible with Reference Number
Address
Precinct Number / Station Number
Contact Number
Authority for requesting information
Complaint emanating from either the Sender or Payee or Court
Case
Details of the complaint MTCN, Amount, Sender and Payee,
TSMF or TRMF
Whenever possible, authority request should cite specific
violations of i.e. Republic Act 7394 (The Consumer Act of the
Philippines); Republic Act 8792 (Electronic Commerce Act of
2000); Republic Act 8799 (The Securities Code); etc.
Type or kind of information needed
Requesting Officer
Complete Name
Rank and Designation / Position
Signature

Police BLOTTER is NOT Acceptable

EXAMPLE DOCS:

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SPOOFED Emails

Numerous companies have been recently targeted by fraudsters by sending fake or

spoofed emails to perpetrate various types of fraud. Western Union is not an
exception.
By way of explanation, spoofed emails are unsolicited emails purported to have been
sent from a legitimate business but are actually the work of fraudsters. Spoofed emails
often try to convince the intended victim that they are the winner of lotteries,
sweepstakes, or other winnings.
Recipients of Western Union spoofed emails should forward the email to the below
Western Union email address and copy Compliance office:

spoof@westernunion.com

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