CHAPTER 6

COVERED AND SUSPICIOUS TRANSACTIONS

Section 6.1. For purposes of the mandatory Covered Transaction Report (CTR), Annex “A”, to be filed before the Anti-Money Laundering Council, copy furnished the Commission, where the amount is within the threshold limit (in excess of P4,000,000.00) as provided under Section 3 (b) of R.A. 9160, each Regulated Intermediary shall clarify the economic background and purpose of any transaction or business relationship if its form or amount appears unusual in relation to the business or financial capacity of the customer and the customer has not been properly identified, or if the economic purpose or legality of the transaction is not immediately clear, as where there is no underlying legal, trade obligation, purpose, origin or economic justification, or where the transaction is unusually large and complex. 

Section 6.2. Where the transaction or transactions do not fall within the threshold amount provided in the definition of a covered transaction, and the Regulated Intermediary has reasonable grounds to believe that the source/s of the funds arise from or are in anyway related to an unlawful activity, the Regulated Intermediary shall file a Suspicious Transaction Report (Annex “B”) before the Anti-Money Laundering Council, copy furnished the Commission.  In this regard, the Regulated Intermediary should exercise due diligence by implementing adequate systems for identifying and detecting suspicious transactions.

Section 6.3. The suspicion relates to a transaction considering all the circumstances of the transaction. As a general principle, any transaction which causes a Regulated Intermediary to have a feeling of apprehension or mistrust about the transaction considering a) its unusual nature or circumstances or, b) the person or group of persons with whom they are dealing, and based on the bringing together of all relevant factors including knowledge of the person's or persons' business or background (as well as behavioral factors) should be reported as a suspect transaction.

Section 6.3. Suspect transactions are likely to involve a number of factors which together raise a suspicion in the mind of the Regulated Intermediary that the transaction may be connected with any unlawful activity. A list of examples of suspicious transactions is attached in Annex “C”.

The list is not intended to be exhaustive and only provide examples of the most basic ways in which money may be laundered. Identification of any of the transactions listed should prompt initial enquiries and, if necessary, further investigations on the source of funds.

Chapter 5     Chapter 7