Guidelines on Reporting of STRs on Designated/Proscribed Individuals, Entities and Associates

Financial Monitoring Unit (FMU) Government of Pakistan 2nd Floor, SBP Main Building, I.I Chundrigar Road, Karachi

FMU Circular No. 1 April 30, 2020 The Chief Executive Officers/Heads All Reporting Entities

Guidelines on Reporting of Suspicious Transaction Reports (STRs) on Designated /Proscribed Individuals / Entities and their Associates

In order to effectively combat the menace of Terrorism/Terrorism Financing (TF), reporting entities are suggested to enhance their internal analysis and investigation capabilities for generation of quality Suspicious Transactions Reports (STRs) pertaining to individuals/ entities and their associates designated/proscribed under United Nations Security Council Resolutions (UNSCRs) 1267 and 1373 as per guidelines issued by the respective regulators. In this regard, Financial Monitoring Unit (FMU) has developed following broader guidelines for the Reporting Entities (REs):

Profiling of the Suspect/Linked Individuals

• While filing of STRs through goAML, complete details should be provided about the suspect such as Name, CNIC, Passport date of birth, addresses, contact numbers, Occupation, email addresses, etc., if available.
• Details pertaining to any linked individuals such as family members, associates, counterparties, etc. should also be provided, wherever available.

Account/Transactional Analysis

• Transactional/ financial activity analysis should be carried out to determine the funds flow and the details of the same should be provided while reporting the STR to FMU.
• Relationship analysis should be performed for identifying number of accounts maintained, other facilities such as loans, credit/debit cards, lockers, wealth and insurance products.
• Major Counter parties details along with their CNICs, etc should be provided (if available) along with STR. Also, linkages (if any identified) between the proscribed/designated individual and the counterparty should be provided.
• In case the proscribed/designated individuals/entities are conducting/executing/ attempting transactions in the accounts of the other individuals/entities, the nature of transaction, time period, amount, currency information and counter parties details should be reported in STR.
• Details of premium paid, sum assured and cash value in case of life insurance, amount of investments/loan granted, value of investments, current MV/ amount of outstanding loan in case of AMC/NBFCs and initial investment brought and value of shares outstanding in case of securities brokers as well as other financial/ non-financial markets, etc.
• Delisting of an individual/entity from the sanctions list should not be considered as a reason for triggering a STR unless there is any other significant information or any high risk element.

Submission of STRs through goAML:

• All the mandatory fields should be properly filled in and no dummy data should be provided to evade the requirements.
• Indicators should be properly selected based on the available information of the Suspect/Associate. Multiple indicators can be selected if required.
• Proper information should be provided in the Action Column of the STR in goAML e.g, Account Frozen/Information shared with requesting authorities such as LEAs, regulators etc.
• The reason for suspicion should focus on all the details available and single liner/ vague reasons of suspicion should be avoided.
• If STR is being triggered based on particular source of information then the same should be clearly stated in STR i.e. reference to database searched, Regulators /LEAs letter reference, Ministries/ Home Department S.R.O on proscription of individual/ entity and associates be made available to FMU in STR. Copy of letters should also be attached.

The above guidelines should be followed by all the Reporting Entities meticulously for effective reporting of STRs under Section 7(1) of AML Act, 2010.