Version 1.0
Prepared by: @Lorraine Sebata
Approved by: @Name
Reviewed date: 2024-07-24
Next review date: 2025-07-24
This SOP details the step-by-step process for all employees of Easyeterms to identify, internally report, and for the Money Laundering Reporting Officer (MLRO) to assess, investigate, and externally report suspicious transactions or activities to the Financial Intelligence Unit (FIU). Its purpose is to ensure consistency, efficiency, compliance with AML/CTF laws, and effective risk management throughout the suspicious transaction reporting cycle.
This SOP applies to all employees, the Money Laundering Reporting Officer (MLRO), and relevant senior management involved in the recognition, internal reporting, and external handling of suspicious transactions for all products and services offered by the company.
Employee: Identifies unusual/suspicious transactions or circumstances and reports them internally to the MLRO.
Money Laundering Reporting Officer (MLRO): Receives, logs, investigates internal reports, determines if suspicion remains, files Suspicious Transaction Reports (STRs) with the FIU, and reports to the Board of Directors.
Board of Directors / Senior Management: Oversees the AML/CTF program, receives reports on filed STRs, and makes decisions regarding client relationships based on MLRO recommendations and FIU directives.
Financial Intelligence Unit (FIU): Receives STRs from the MLRO, conducts investigations, and issues directives or Production Orders.
5.1.1 An employee identifies an unusual and/or suspicious transaction or circumstance (e.g., something outside the scope of the client's known purpose/nature of relationship, inconsistent with normal account activity, or lacking plausible explanation or supporting documentation/information).
5.1.2 The employee understands that they are not required to conduct an investigation themselves and need not be certain or have concrete evidence of any criminal offense, including money laundering, terrorist financing, or proliferation financing. The threshold is reasonable grounds for suspicion.
5.2.1 Immediately upon forming knowledge or suspicion, the employee documents the details of the suspicious activity or circumstance. This documentation should be factual and avoid speculation.
5.2.2 The employee reports this knowledge or suspicion to the Money Laundering Reporting Officer (MLRO) without delay, using the internal "Unusual Transaction Report" form (refer to Appendix 8).
5.2.3 The employee must ensure that the client or any other party involved is not "tipped off" about the internal report or any potential investigation. Business as usual should be maintained unless otherwise directed by the MLRO.
5.3.1 The MLRO acknowledges receipt of the internal report from the employee.
5.3.2 The MLRO logs the report in a dedicated internal register for unusual transactions, referencing the "Unusual Transaction Report" (Appendix 8).
5.3.3 The MLRO conducts a thorough review of all available information concerning the client and the reported transaction(s), including customer verification records, due diligence information, transaction history, and any other relevant data.
5.3.4 Where necessary, the MLRO may request additional information from the client to determine if suspicion remains. This must be done carefully to avoid tipping-off the client.
5.3.5 Based on the review and any further investigation, the MLRO determines whether the initial report gives rise to a reasonable suspicion of money laundering, terrorist financing, proliferation financing, or other financial crime.
5.4.1 If deemed NOT suspicious: The MLRO clearly annotates the decision and the reasoning for dismissing the suspicion on the "Unusual Transaction Report" form and in the internal log. The documentation must be comprehensive and justifiable.
5.4.2 If deemed suspicious: The MLRO proceeds to file a Suspicious Transaction Report (STR) with the Financial Intelligence Unit (FIU).
5.5.1 If deemed suspicious, the MLRO completes the official "Suspicious Transaction Report (STR)" form (refer to Appendix 9), ensuring all required information is accurately provided.
5.5.2 The MLRO files the completed STR with the Financial Intelligence Unit (FIU) as soon as practical, ensuring compliance with all FIU submission guidelines.
5.5.3 The MLRO reports the filing of the STR to the Board of Directors / Senior Management.
5.6.1 The MLRO follows up with the FIU to obtain an acknowledgement of receipt of the disclosure.
5.6.2 The MLRO adheres to any directives given by the FIU and complies with any Production Orders issued by the authorities.
5.6.3 The MLRO and/or senior management follow any actions deemed necessary by the Board of Directors with regard to the client relationship, such as the potential termination of the relationship.
5.6.4 Before terminating a client relationship due to a filed STR, Management will liaise with the Investigating Officer at the FIU to ensure that the termination does not "tip off" the customer or prejudice the ongoing investigation in any way.
Unusual Transaction Report (Appendix 8)
Suspicious Transaction Report (STR) (Appendix 9)
MLRO Internal Log of Reports
Client Identification and Due Diligence Records
Transaction Records
Correspondence with FIU (acknowledgements, directives)
All employees, particularly those handling client transactions, will receive mandatory annual training on the recognition of suspicious transactions and the internal reporting procedures outlined in this SOP, as well as the broader AML/CTF policies.
This SOP will be reviewed annually by the Compliance Department in conjunction with Senior Management to ensure its continued effectiveness, compliance with regulatory changes, and alignment with the Company's risk profile.