W h at are th e C u stom er

Id en tif i
cation R eq u irem en ts
K YC (K n ow You r C u stom er R u le)?

R A 9160 S ec.9a R u le 5 S ec.1

Sec 9: Prevention of M oney
Laundering
Custom er Identif c
iation R equirem ents and
R ecord K eeping
a. True Identity of individuals as Clients
Covered institutions shall establish and record the
true and full identity of their clients based on
official documents.
-develop clear acceptance policies and procedures
when conducting business such as opening of
deposit accounts, accepting deposit substitutes,
entering into trust and other fiduciary transactions,
renting of safety deposit boxes, performing
remittances and other large transactions.
-when dealing with customers who are
trustee, nominee, agent or any
representative, it shall verify and
record the true and full identity of the
persons, the nature of their capacity
and duties and their principal. In case
it has as to whether such persons are
being used as dummies or
circumventing the law, it must make
inquiries to verify status of the
business relationship between parties.
b. Minimum Information/ Documents
required for Individual Customers
-require customers to produce original
documents of identity issued by an official
authority (e.g. ID cards, passports)
Minimum information to be obtained:
1. Name 6. Nature of work/employer/business
2. Present address 7. Contact numbers
3. Permanent address 8. TIN, SSS/GSIS Numbers
4. Date and place of birth9. Specimen signature
5. Nationality 10. Source of funds
11. Beneficiaries names
c. In case of corporate and juridical clients,
require a system verifying their legal existence
and organizational structure, as well as the
authority and identification of all persons
purporting to act in their behalf.
Minimum information/document to be obtained:
1. AOI
2. By-laws
3. Official/Principal address
4. List of directors/partners
5. List of principal stockholders
6. Contact numbers 7. Beneficial owners
8. Verification of the authority & identification of
the representative of the client
Verif c
iation w ithout face-to face contact
No transaction shall be honored by
any covered institution respecting an
account created without face-to-face
contact unless:

The customer complies with the

requirements under the 2 preceding
subsections and other requirements
imposed by BSP, SEC, IC pursuant to
this Rule 5 an their charter within
10days from creation of new accounts
A cquisition of another Covered
Institution
It is not necessary to re-establish
identity of all existing customers
provided:
a. All customer account records are
acquired with the business
b. Due diligence inquiries do not raise
any doubt as to compliance of the
acquired business full compliance
with all requirements and this Rule5
R isk-m onitoring and R eview
Covered institutions shall adopt
programs for on-going monitoring of
high-risk accounts and risk
management
Regular reviews of customer base
should be undertaken to identify,
monitor and control nature of
accounts and potential risks
P rohibition against C ertain A ccounts
Covered institutions shall maintain
accounts only in the true name of the
account holder/owner. Anonymous
accounts, accounts using fictitious
names, incorrect name accounts and
all other similar accounts are
absolutely prohibited.
 N um bered Accounts
Peso and foreign currency non-
checking numbered accounts shall be
allowed: provided
a. True identity is satisfactorily
established based on official and
reliable documents
b. Requirements under Section 1(b) and
(c) of this Rule5 are obtained and
recorde
W H AT A R E TH E R EC O R D -
K EEP IN G R EQ U IR EM EN TS ?

RA 9160 SEC.9B RULE 5 SEC.2

Sec2: R ecord-keeping
R equirem ents
Prepare and maintain
documentation, in accordance with
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;
a. Existing and New Accounts and New
Transactions
-Maintain and safely store all records of
existing and new accounts and of new
transactions for 5 years from October 17,
2001 or from the dates of the accounts
or transactions, whichever is later;

b. Closed Accounts
-Preserve and safely store the records on
customer identification, account files and
business correspondence for at least 5
years from the dates they were closed;
c. Retention of Records in Case a Money
Laundering Case Has been Filed in
Court
- If a money laundering case based on
any record kept by the covered
institution has been filed in court, retain
said files until it is confirmed that the
case has been finally resolved or
terminated by the court;

d. Form of Records
-Retain records as originals or certified
true copies in such forms as are
All covered institutions shall:

Maintain and safely store all records of

all their transactions for five years from
the transaction dates;
Ensure that said records/files contain the
full and true identity of the owners or
holders of the accounts involved in the
covered transactions and all other
identification documents;
Undertake the necessary adequate
measures to ensure the confidentiality of
such files;
W H AT A R E C O V ER ED
TR A N S A C TIO N S ?

R A 9160 S EC .3(B )
 Transaction in cash or other
equivalent monetary instruments
involving a total amount in excess
of P500,000.00 within one
business day.
W H AT A R E S U S P IC IO U S
TR A N S A C TIO N S ?

R A 9160 S EC .3(B 1)
Transactions, regardless of the
amount involved, where the
following circumstances exist:
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 offense under this Act that
is about to be, is being or has been committed;
or
g. any transaction that is similar or analogous to
the foregoing.
W H AT A R E TH E R EP O R TIN G
R EQ U IR EM EN TS ?

R A 9160 S EC 9(C )
 Covered institutions shall report to the
AMLC all covered transactions and
suspicious transactions within five (5)
working days from occurrence/discovery
thereof, unless the Supervision Authority
(the BSP, the SEC, or the IC) prescribes a
longer period not exceeding ten working
days.

Should a transaction be determined to be

both a covered transaction and a suspicious
transaction, it shall be reported as
suspicious transaction.
 Exemption from Bank Secrecy Laws
When reporting covered transactions to
the AMLC, banks and their officers,
employees, representatives, agents,
advisors consultants and associates shall
not be deemed to have violated RA1405
and other similar laws. (Rule 3,Sec.2d)

Safe Harbor Provision:

No proceedings shall lie against any
person for having made a report in the
regular performance of his duties and in
good faith (Rule 3,Sec.2c)
H O W IS R EP O R TIN G
D O N E?
 The reports on covered and/or suspicious
transactions shall be accomplished in the
prescribed formats and submitted within five
business days from occurrence of the
transactions in a secured manner to the AMLC
in electronic form, either via diskettes, leased
lines, or through internet facilities. The
corresponding hard copy for suspicious
transactions shall be sent to AMLC at the 5th
Floor EDPC Building, Bangko Sentral ng
Pilipinas Complex, Manila, Philippines. All
pawnshops should coordinate with the AMLC
thru tel. nos. 523-4421, 521-5662 or 302-3979
on reporting requirements, procedures and
deadlines.
A R E TH ER E S A N C TIO N S
FO R FA ILU R E TO R EP O R T
C O V ER ED O R S U S P IC IO U S
TR A N S A C TIO N S A N D N O N -
C O M P LIA N C E W ITH R .A .
9160, A S A M EN D ED ?
 Sanctions/penalties shall be
imposed on pawnshops that will
fail to comply with the provisions
of R.A. 9160, as amended.
W H AT A R E TH E S A N C TIO N S FO R
FA ILU R E TO R EP O R T C O V ER ED
O R S U S P IC IO U S TR A N S A C TIO N S ?
 Any person, required to report
covered and suspicious transactions
who failed to do so will be subjected
to:
a.) penalty of 6 months to 4 years
imprisonment or
b.) a fine of not less than
P100,000.00 but not more than
P500,000.00, or both.
A R E TH ER E C O N FID EN TIA LITY
R ES TR IC TIO N S O N TH E R EP O R TIN G
O F C O V ER ED TR A N S A C TIO N A N D /O R
S U S P IC IO U S TR A N S A C TIO N ?
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.