Circular Letter No. 4001 — Discloses a list of operations and situations that may constitute indications of money laundering or concealment of assets, rights and values, and terrorism financing

The Head of the Department of Conduct Supervision (Decon), using the attribution granted by Article 23, item I, letter "a", of the Internal Regulations of the Central Bank of Brazil, annexed to Ordinance No. 105.173, of October 24, 2019,

R E S O L V E S:

Art. 1. The operations or situations described below exemplify the occurrence of suspicion indicators for the purposes of monitoring and selection procedures provided for in Circular No. 3,978, of January 23, 2020:

I - Situations related to cash operations in national currency using deposit accounts or payment accounts:

a) deposits, contributions, withdrawals, requests for provisioning for withdrawal, or any other instrument for the transfer of cash resources, which present atypicality in relation to the client's economic activity or incompatibility with their financial capacity;

b) cash movements carried out by clients whose activities are characterized by the use of other instruments for the transfer of resources, such as checks, debit or credit cards;

c) substantial increases in the volume of cash deposits or contributions by any natural or legal person, without apparent cause, in cases where such deposits or contributions are subsequently transferred, within a short period of time, to a destination unrelated to the client;

d) fragmentation of deposits or other instruments for the transfer of cash resources, including payment slips, in order to disguise the total value of the movement;

e) fragmentation of cash withdrawals, in order to circumvent regulatory reporting limits;

f) deposits or contributions of large amounts of cash, in installments, mainly at the same cashiers or nearby self-service terminals, destined for a single account or several accounts in different municipalities or branches;

g) cash deposits or contributions into accounts of clients who engage in commercial activities related to the trading of luxury or high-value goods, such as works of art, real estate, boats, jewelry, automobiles, or aircraft;

h) cash withdrawals from an account that receives several deposits via electronic transfer from various sources in a short period of time;

i) cash deposits or contributions with damp, smelly, moldy banknotes, or with the appearance of having been stored in an improper location, or that present unknown marks, symbols, or seals, packaged in disorganized and non-uniform bundles;

j) deposits, contributions, or exchange of large quantities of small-denomination banknotes, by a natural or legal person, whose activity or business is not characterized by receiving large amounts of cash resources;

k) withdrawals within a period of five business days in values lower than the established limits, in order to disguise the total value of the operation and avoid reporting of cash operations;

l) two or more cash withdrawals at the cashier on the same day, with indications of an attempt to circumvent the identification of the withdrawer;

m) two or more cash deposits at self-service terminals within a period of five business days, with indications of an attempt to circumvent the identification of the depositor;

n) relevant cash deposits in the accounts of public servants and any type of Politically Exposed Persons (PEPs), as listed in Article 27 of Circular No. 3,978, of 2020, as well as their representative, family member, or close collaborator.

II - Situations related to cash operations and prepaid cards in foreign currency and traveler's checks:

a) movements of foreign currency in cash or traveler's checks denominated in foreign currency, which present atypicality in relation to the client's economic activity or incompatibility with their financial capacity;

b) negotiations of foreign currency in cash or traveler's checks denominated in foreign currency, which do not present compatibility with the declared nature of the operation;

c) negotiations of foreign currency in cash or traveler's checks denominated in foreign currency, carried out by different unrelated natural persons, who provide the same residential address, contact phone number, or have the same legal representative;

d) negotiations involving exchange rates with significant variation compared to those practiced by the market;

e) negotiations of foreign currency in cash involving damp, smelly, moldy banknotes, or with the appearance of having been stored in an improper location, or that present unknown marks, symbols, or seals, packaged in disorganized and non-uniform bundles;

f) negotiations of foreign currency in cash or exchange of large quantities of small-denomination banknotes, carried out by a natural or legal person, whose activity or business is not characterized by receiving this type of resource;

g) use, loading, or reloading of a prepaid card in a value not compatible with the client's financial capacity, activity, or profile;

h) use of various sources of resources for loading and reloading prepaid cards;

i) loading and reloading of prepaid cards immediately followed by withdrawals at ATMs.

III - Situations related to the identification and qualification of clients:

a) resistance to providing information necessary to start the relationship or for updating registration;

b) offering false information;

c) providing information that is difficult or costly to verify;

d) opening, moving accounts, or carrying out operations by the holder of a power of attorney or any other type of mandate;

e) occurrence of irregularities related to the identification and registration procedures of operations required by current regulation;

f) registration of several accounts on the same date, or in a short period, with deposits of identical or approximate values, or with other common elements, such as source of resources, owners, attorneys, partners, address, phone number, etc.;

g) operations where it is not possible to identify the beneficial owner, observing the procedures defined in current regulation;

h) representation of different legal entities or organizations by the same attorneys or legal representatives, without reasonable justification for such occurrence;

i) information of the same residential or commercial address by natural persons, without demonstrating the existence of a family or commercial relationship;

j) incompatibility of the declared economic activity or revenue with the pattern presented by clients with the same profile;

k) registration of the same email address or Internet Protocol (IP) by different legal entities or organizations, without reasonable justification for such occurrence;

l) registration of the same email address or Internet Protocol (IP) by natural persons, without reasonable justification for such occurrence;

m) information and documents presented by the client conflicting with publicly available information;

n) partners of companies without apparent financial capacity for the size of the declared business activity.

IV - Situations related to the movement of national currency deposit accounts and payment accounts, concerning:

a) movement of resources incompatible with the client's assets, economic activity, or professional occupation and financial capacity;

b) transfers of rounded values in the thousands unit or slightly below the limit for operation notification;

c) movement of high-value resources, habitually, for the benefit of third parties;

d) maintenance of numerous accounts intended to receive deposits in the name of the same client, whose values, when added up, result in a significant amount;

e) movement of a significant amount through an account that was previously little used or an account that receives an unusual deposit;

f) sudden absence of financial movement in an account that previously showed large movement;

g) atypical use of rented safes in relation to the client's profile;

h) waiver of the option to use prerogatives such as receiving credit, remunerative interest for large balances, or other special banking services that, under normal circumstances, would be valuable for any client;

i) sudden and unjustified change in the way resources are moved or in the types of transactions used;

j) request for non-compliance or acting in a way to induce institution employees to not follow regulatory or formal procedures to carry out an operation;

k) receipt of resources with immediate purchase of instruments to make payments or transfers to third parties, without justification;

l) operations that, due to their habitual nature, value, and form, constitute a device to circumvent the identification of the origin, destination, responsible parties, or final recipients;

m) existence of accounts that present credits and debits using instruments for the transfer of resources not characteristic of the occupation or business sector developed by the client;

n) receipt of deposits from various sources, without economic-financial justification, especially from regions distant from the location of the legal entity's operation or distant from the domicile of the natural person;

o) habitual payments to suppliers or beneficiaries that do not have a link with the activity or business sector of the legal entity;

p) payments or transfers by a legal entity to a distant supplier from its place of operation, without economic-financial justification;

q) deposits of endorsed checks totaling significant values;

r) existence of checking accounts or payment accounts of non-profit organizations whose balances or financial movements do not present economic or legal justification or in which it seems there is no link between the declared activity of the organization and the other parties involved in the transactions;

s) habitual movement of financial resources from or to any type of PEP, as listed in Article 27 of Circular No. 3,978, of 2020, as well as their representative, family member, or close collaborator, not justified by economic events;

t) existence of accounts in the name of minors or incapacitated persons, whose representatives carry out a large number of operations and/or operations of relevant values;

u) significant and unusual transactions through deposit accounts or payment accounts of non-resident investors constituted in the form of a trust;

v) receipt of relevant values at the same payment terminal (Point of Sale - POS), showing indications of atypicality or incompatibility with the financial capacity of the accredited commercial establishment;

w) receipt of relevant values at the same payment terminal (Point of Sale - POS), showing indications of atypicality or incompatibility with the profile of the accredited commercial establishment;

x) frequent deviations from patterns adopted by each card administration or credit card company, verified in the monitoring of their holders' purchases;

y) transactions at a time considered incompatible with the activity of the accredited commercial establishment;

z) transactions at a terminal (Point of Sale - POS) carried out in a geographic location distant from the place of operation of the accredited commercial establishment;

aa) atypical operations in accounts of clients who engage in commercial activities related to the trading of luxury or high-value goods, such as works of art, real estate, boats, jewelry, automobiles, or aircraft;

ab) use of a financial instrument to hide assets and/or avoid judicial blockades, including administrative checks;

ac) movement of values incompatible with the monthly revenue of legal entities;

ad) receipt of credits with the immediate debit of the values;

ae) movements of values with companies without regulated activity by the competent authorities.

V - Situations related to investment operations in the Country:

a) operations or set of operations of purchase or sale of financial assets at prices incompatible with those practiced in the market or when carried out by a natural or legal person whose declared activity and profile do not align with the type of negotiation carried out;

b) atypical operations that result in high gains for intermediary agents, disproportionate to the nature of the services effectively provided;

c) significant investments in low-yield and low-liquidity products;

d) significant investments not proportional to the client's financial capacity, or whose origin is not clearly known;

e) redemption of investments in the very short term, regardless of the result obtained.

VI - Situations related to credit operations in the Country:

a) credit operations in the Country settled with resources apparently incompatible with the client's financial situation;

b) request for credit concession in the Country incompatible with the client's economic activity or financial capacity;

c) credit operation in the Country followed by remittance of resources abroad, without economic or legal justification, and without relationship with the credit operation;

d) credit operations in the Country, simultaneous or consecutive, settled in advance or in a very short term;

e) settlement of credit operations or assumption of debt in the Country by third parties, without apparent justification;

f) granting of guarantees for credit operations in the Country by third parties not related to the borrower;

g) credit operation in the Country with the offering of guarantee abroad by a client without a tradition of carrying out operations abroad;

h) acquisition of goods or services incompatible with the object of the legal entity, especially when the resources originate from credit in the Country.

VII - Situations related to the movement of resources originating from contracts with the public sector:

a) atypical movements of resources by public agents, as defined in Article 2 of Law No. 8,429, of June 2, 1992;

b) atypical movements of resources by natural or legal persons related to sponsorship, advertising, marketing, consultancies, advisory services, and training;

c) atypical movements of resources by non-profit organizations;

d) atypical movements of resources by natural or legal persons related to bidding processes.

VIII - Situations related to consortia:

a) existence of consortium members holding a high number of shares, incompatible with their financial capacity or with the object of the legal entity;

b) significant increase in the number of shares belonging to the same consortium member;

c) offering of bids incompatible with the consortium member's financial capacity;

d) offering of bids very close to the value of the asset;

e) advance payment of a significant quantity of future installments, not consistent with the consortium member's financial capacity;

f) acquisition of previously awarded shares, followed by settlement of future installments;

g) use of forged documents in adherence or attempted adherence to a consortium group;

h) payments made in locations different from the address in the registration;

i) provision of a checking or savings account for payment of credit in cash, at a branch/location different from the one initially provided or remittance of any Payment Order (PO) to a checking or savings account different from the one initially provided.

IX - Situations related to persons or entities suspected of involvement in terrorism financing and proliferation of weapons of mass destruction:

a) financial movements involving persons or entities related to terrorist activities listed by the United Nations Security Council (UNSC);

b) operations or provision of services, of any value, to persons or entities that have recognizedly committed or attempted to commit terrorist acts, or participated in or facilitated their commission;

c) existence of resources belonging to or controlled, directly or indirectly, by persons or entities that have recognizedly committed or attempted to commit terrorist acts, or participated in or facilitated their commission;

d) movements with indications of terrorism financing;

e) financial movements involving persons or entities related to the proliferation of weapons of mass destruction listed by the UNSC;

f) operations or provision of services, of any value, to persons or entities that have recognizedly committed or attempted to commit crimes of proliferation of weapons of mass destruction, or participated in or facilitated their commission;

g) existence of resources belonging to or controlled, directly or indirectly, by persons or entities that have recognizedly committed or attempted to commit crimes of proliferation of weapons of mass destruction, or participated in or facilitated their commission;

h) movements with indications of financing the proliferation of weapons of mass destruction.

X - Situations related to international activities:

a) operation with natural or legal persons, including societies and financial institutions, located in countries that do not apply or apply insufficiently the recommendations of the Financial Action Task Force (FATF), or that have headquarters in countries or dependencies with favored taxation or privileged fiscal regimes, or in locations where the habitual practice of the crimes provided for in Law No. 9,613, of March 3, 1998, is observed, not clearly characterized in their legality and economic justification;

b) complex operations with higher costs that aim to hinder the tracking of resources or the identification of the nature of the operation;

c) advance or non-advance payment of imports and receipts of exports, by a company without tradition or whose financial capacity is incompatible with the amount negotiated;

d) payments to third parties not related to import or export operations;

e) unilateral transfers that, due to their habitual nature, value, or form, are not justified or present atypicality;

f) international transfers, including for availability abroad, in which the origin of the funds involved is not justified or appear incompatible with the client's financial capacity or profile;

g) apparently fictitious exports or imports or with indications of over-invoicing or under-invoicing, or in situations where it is not possible to obtain information about the customs clearance of the goods;

h) existence of information in the letter of credit with discrepancies in relation to other documents of the international trade operation;

i) payments abroad after credits in reais made in the deposit accounts of the holders of foreign exchange operations by natural or legal persons who do not demonstrate the existence of a commercial or economic link;

j) movements resulting from a resource repatriation program that present inconsistencies related to the identification of the owner or final beneficiary, as well as absence of reliable information about the origin and economic or legal justification;

k) payment of freight or other services that present indications of atypicality or incompatibility with the client's activity or economic-financial capacity;

l) international transfers by one or more natural or legal persons with indications of fragmentation, as a way to hide the real origin or destination of the resources;

m) transactions on the same date, or in a short period, of identical or approximate values, or with other common elements, such as source or destination of resources, owners, attorneys, address, phone number, that constitute a device to circumvent the maximum operation limit;

n) transfer via a payment facilitator or using an international use credit card, that, due to their habitual nature, value, or form, are not justified or present atypicality;

o) transfers related to unconventional investments that, due to their habitual nature, value, or form, are not justified or present atypicality;

p) payment of international freight without support in documentation that evidences a link with a commercial operation.

XI - Situations related to credit operations contracted abroad:

a) contracting of credit operations abroad with clauses that establish conditions incompatible with those practiced in the market, such as interest rates divergent from practice or very long terms;

b) contracting, abroad, of several consecutive credit operations, without the institution being aware of the settlement of the previous ones;

c) contracting, abroad, of credit operations that are not settled through operations at the same institution;

d) contracting, abroad, of credit operations, settled without apparent explanation for the origin of the resources;

e) contracting of loans or financing abroad, offering guarantees in values or forms incompatible with the client's activity or financial capacity or in values much higher than the value of the contracted operations or whose origin is not clearly known;

f) contracting of credit operations abroad, whose creditor is difficult to identify and without there being a relationship or justification for the operation between the parties.

XII - Situations related to external investment operations:

a) receipt of direct external investment, whose resources return immediately as availability abroad;

b) receipt of direct external investment, with almost immediate realization of remittances of resources abroad as profits and dividends;

c) remittances of profits and dividends abroad in values incompatible with the invested value;

d) remittances abroad as investment in amounts incompatible with the client's financial capacity;

e) remittances of resources from the same investor located abroad to several companies in the Country;

f) remittances of resources from several investors located abroad to the same company in the Country;

g) receipt of capital contribution disproportionate to the size or business nature of the client, or in values incompatible with the financial capacity of the partners;

h) return of investment made abroad without proof of the remittance that gave rise to it.

XIII - Situations related to employees, partners, and outsourced service providers:

a) unusual change in the lifestyle and behavior patterns of the employee, partner, or outsourced service provider, without apparent cause;

b) unusual modification of the operational result of the partner's legal entity, including correspondent in the Country, without apparent cause;

c) any business carried out in a manner different from the formal procedure of the institution by an employee, partner, including correspondent in the Country, or outsourced service provider;

d) providing assistance or information, remunerated or not, to a client to the detriment of the institution's anti-money laundering and counter-terrorist financing prevention program, or assistance to structure or fragment operations, circumvent regulatory or operational limits.

XIV - Situations related to electoral campaigns:

a) receipt of donations, in accounts (electoral or otherwise) of candidates, accounts of close collaborators of these persons, or in accounts of political parties, of values that disregard prohibitions or exceed limits defined in current legislation;

b) use incompatible with regulatory requirements for the party's cash fund;

c) receipt of donations, in candidates' accounts, of values that disregard prohibitions or exceed limits defined in current legislation, including through the use of third parties and/or third-party accounts;

d) transfers, from candidates' accounts, to natural or legal persons whose activity does not appear to have any relation to campaign accounts.

XV - Situations related to NFDDs and other non-financial assets:

a) trading of NFDDs or other non-financial assets with natural or legal persons lacking financial capacity;

b) trading of NFDDs or other non-financial assets with cash payment;

c) trading of NFDDs or other non-financial assets at a price significantly higher than the assessed value;

d) trading of other non-financial assets for the benefit of third parties.

XVI - Situations related to the movement of foreign currency current accounts (CCME):

a) movement of funds incompatible with the client's economic activity and financial capacity;

b) receipts or payments to/from third parties whose financial movements lack economic or legal justification or in which there appears to be no link between the declared activity of the CCME holder and the other parties involved in the transactions;

c) movement of funds, especially in accounts held by agents authorized to operate in the foreign exchange market, that demonstrate non-compliance with limits per foreign exchange operation or any other situation where there is no justification or presents atypicality, due to habitualness, value, form, or lack of adherence to foreign exchange regulations;

d) atypical transactions in restricted-movement CCMEs. Examples: travel agency accounts and credit card administrator accounts.

XVII - Situations related to operations carried out in municipalities located in risk regions:

a) atypical operation in municipalities located in border regions;

b) atypical operation in municipalities located in mineral extraction regions;

c) atypical operation in municipalities located in other risk regions.

§ 1st The operations or situations referred to in the caput must be communicated, in accordance with the aforementioned Circular, only in cases where the indicators are confirmed at the end of the execution of the suspicious operations and situations analysis procedures.

§ 2nd. The procedures referred to in § 1st must consider all available information, including that obtained through procedures designed to know customers, employees, partners, and outsourced service providers.

Art. 2nd This Circular Letter enters into force on July 1, 2020, when Circular Letter No. 3,542 of March 12, 2012, is revoked.

Andreia Laís de Melo Silva Vargas

Head of the Department of
Conduct Supervision