CFL - POLICY FRAMEWORK ON ‘KNOW YOUR CUSTOMER’ (KYC) AND ANTI-MONEY LAUNDERING MEASURES

Chinmay Finlease Limited Policy Overview
 

Chinmay Finlease Limited is committed to ensuring the following:

1. The Company follows a strict customer identification procedure for opening accounts and monitoring transactions of a suspicious nature, reporting them to the appropriate authorities.

2. Information collected from customers for account opening is kept confidential. The Company does not divulge these details for cross-selling or any other purposes.

3. The information requested from customers is relevant to perceived risks, non-intrusive, and adheres to established guidelines. Any additional information is sought separately with the customer's consent only after opening the account.

This policy is framed around four key elements:

- Customer Acceptance Policy

- Customer Identification Procedures

- Transaction Monitoring

- Risk Management

Customer Acceptance Policy (CAP)

The Company has established a Customer Acceptance Policy, which provides explicit customer acceptance criteria. 

Key guidelines include:

- No accounts are opened in anonymous or fictitious names.
- Parameters for risk perception are clearly defined based on the nature of business activities, customer location, client details, payment methods, transaction volume, and social and financial status. Customers requiring higher monitoring levels, such as Politically Exposed Persons, may be categorized accordingly.
- Documentation requirements and information collection depend on the perceived risk category, aligning with the PML Act, 2002, and Reserve Bank guidelines.
- The Company only opens or maintains accounts when it can apply appropriate customer due diligence due to customer non-cooperation or unreliable information. Safeguards are in place to prevent any customer harassment.
- Established banking laws and practices clearly outline the circumstances in which a customer may act on behalf of another person/entity.
- Necessary checks are performed before opening new accounts to ensure the customer's identity does not match anyone with a known criminal background or ban list, such as terrorist organizations.
- Adopting the Customer Acceptance Policy and its implementation does not restrict banking services to the general public, especially those financially or socially disadvantaged.

Customer Identification Procedure (CIP)

The Company follows a Customer Identification Procedure to gather information and identify customers. 

The guidelines include:
- The Company collects sufficient information to verify the identity of each new customer, whether regular or occasional and to understand the intended purpose of the banking relationship. This risk-based approach avoids disproportionate costs for banks and burdensome processes for customers.
- For natural persons, sufficient identification data is obtained to verify the customer's identity, address/location, and recent photograph.

Monitoring of Transactions

The Company actively monitors customer activity to identify transactions that deviate from expected patterns. The extent of monitoring is based on the account's risk sensitivity. Key points include:

- Special attention is given to complex transactions, huge transactions, and unusual patterns lacking apparent economic or lawful purposes.
- Transactions involving large cash amounts inconsistent with regular customer activity are reported to the bank.
- The Company maintains a record of transactions as required by section 12 of the PML Act, 2002, and reports suspicious transactions or any other specified types to the appropriate law enforcement authority.

Risk Management

The Company ensures the implementation of an effective KYC program by establishing appropriate procedures and rigorous enforcement. 
These include:
- Proper management oversight, systems and controls, segregation of duties, employee training, and other related matters.
- An internal audit and compliance function evaluates adherence to KYC policies and procedures.
- Employee training programs are conducted to ensure staff are updated on KYC protocols and practices.

By adhering to these policies and procedures, Chinmay Finlease Limited aims to maintain high customer identification and transaction monitoring standards to promote safety and integrity in its operations.