Financial Services Authority Regulation Number 23/POJK.01/2019 Regarding Amendments to Financial Services Authority Regulation Number 12/POJK.01/2017 on the Implementation of Anti-Money Laundering and Counter-Terrorism Financing Programs in the Financial Services Sector

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
COPY
FINANCIAL SERVICES AUTHABILITY REGULATION
REPUBLIC OF INDONESIA
NUMBER 23 /POJK.01/2019
CONCERNING
AMENDMENTS TO FINANCIAL SERVICES AUTHORITY
REGULATION NUMBER 12/POJK.01/2017 ON THE IMPLEMENTATION OF ANTI-MONEY LAUNDERING AND COUNTER-TERRORISM FINANCING PROGRAMS IN THE FINANCIAL SERVICES SECTOR BY THE GRACE OF GOD ALMIGHTY THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering:
a. that in order to prevent the financing of the proliferation of weapons of mass destruction, Indonesia has a commitment to support the inclusion of the identity of persons or corporations in the proliferation financing list for weapons of mass destruction, and the immediate blocking of funds belonging to persons or corporations listed in the proliferation financing list for weapons of mass destruction; b. that the prevention of money laundering crimes and terrorism financing crimes, and the commitment to support the inclusion of the identity of persons or corporations in the proliferation financing list for weapons of mass destruction, and immediate blocking, are realized through provisions regulating risk assessments referring to national risk assessments and sectoral risk assessments, verification and document management activities, and support for the acceleration of information submission to law enforcement;

c. that based on the considerations as referred to in letters a and b, it is necessary to establish a Financial Services Authority Regulation regarding Amendments to Financial Services Authority Regulation Number 12/POJK.01/2017 on the Implementation of Anti-Money Laundering and Counter-Terrorism Financing Programs in the Financial Services Sector;
Considering:

Law Number 8 of 2010 concerning the Prevention and Eradication of Money Laundering Crimes (State Gazette of the Republic of Indonesia Year 2010 Number 122, Supplement to the State Gazette of the Republic of Indonesia Number 5164);
Law Number 21 of 2011 concerning the Financial Services Authority (State Gazette of the Republic of Indonesia Year 2011 Number 111, Supplement to the State Gazette of the Republic of Indonesia Number 5253);
Law Number 9 of 2013 concerning the Prevention and Eradication of Terrorism Financing Crimes (State Gazette of the Republic of Indonesia Year 2013 Number 50, Supplement to the State Gazette of the Republic of Indonesia Number 5406);
Financial Services Authority Regulation Number 12/POJK.01/2017 on the Implementation of Anti-Money Laundering and Counter-Terrorism Financing Programs in the Financial Services Sector (State Gazette of the Republic of Indonesia Year 2017 Number 57, Supplement to the State Gazette of the Republic of Indonesia Number 6035);
DECIDING:
Establishing: FINANCIAL SERVICES AUTHORITY REGULATION OF THE REPUBLIC OF INDONESIA CONCERNING AMENDMENTS TO FINANCIAL SERVICES AUTHORITY REGULATION NUMBER 12/POJK.01/2017 ON THE IMPLEMENTATION OF ANTI-MONEY LAUNDERING AND COUNTER-TERRORISM FINANCING PROGRAMS IN THE FINANCIAL SERVICES SECTOR.

Article I
Several provisions in Financial Services Authority Regulation Number 12/POJK.01/2017 on the Implementation of Anti-Money Laundering and Counter-Terrorism Financing Programs in the Financial Services Sector (State Gazette of the Republic of Indonesia Year 2017 Number 57, Supplement to the State Gazette of the Republic of Indonesia Number 6035) are amended as follows:

Between point 7 and point 8 of Article 1, 2 (two) points are inserted, namely point 7a and point 7b, between point 21 and point 22, 1 (one) point is inserted, namely point 21a, and point 21 of Article 1 is amended, so that Article 1 reads as follows:
Article 1
In this Financial Services Authority Regulation, the following terms are defined as:
Financial Services Authority, hereinafter abbreviated as OJK, is an independent institution having the functions, duties, and authorities of regulation, supervision, examination, and investigation as referred to in the Law regulating the OJK.
Financial Service Provider, hereinafter abbreviated as PJK, is a financial service provider in the banking sector, a financial service provider in the Capital Market sector, and a financial service provider in the non-bank financial industry sector.
PJK in the Banking Sector is a commercial bank, including branch offices of banks located outside the country, sharia commercial banks, rural banks hereinafter abbreviated as BPR, and sharia rural financing banks hereinafter abbreviated as BPRS as regulated in statutory regulations in the Banking sector.
PJK in the Capital Market sector is a securities company conducting business activities as an underwriter of securities issuance, securities trading intermediary, and/or investment manager, as well as commercial banks performing custodian functions as regulated in statutory regulations in the Capital Market sector.
PJK in the Non-Bank Financial Industry Sector is an insurance company, sharia insurance company, insurance brokerage company, pension fund financial institution (DPLK), financing company, venture capital company (PMV), infrastructure financing company, Indonesia Export Financing Agency (LPEI), pawnshop company, microfinance institution (LKM), and internet-based lending service providers, as referred to in statutory regulations in the Non-Bank Financial Industry.
Money Laundering is money laundering as referred to in the Law regulating the prevention and eradication of money laundering crimes.
Terrorism Financing is terrorism financing as referred to in the Law regulating the prevention and eradication of terrorism financing crimes.
7a. Proliferation of Weapons of Mass Destruction is the spread of nuclear, biological, and chemical weapons.
7b. Blocking is an action preventing the transfer, conversion, exchange, placement, division, movement, or movement of funds for a certain period.
Prospective Customer is a party that will use the services of a PJK.
Customer is a party that uses the services of a PJK.
Walk-in Customer, hereinafter abbreviated as WIC, is a party that uses the services of a PJK in the Banking Sector or PJK in the Capital Market sector but does not have an account at the PJK in the Banking Sector or the PJK in the Capital Market sector, excluding parties who receive orders or assignments from Customers to conduct transactions on behalf of Customers.
Customer Due Diligence (CDD) is an activity consisting of identification, verification, and monitoring conducted by a PJK to ensure transactions are consistent with the profile, characteristics, and/or transaction patterns of Prospective Customers, Customers, or WICs.
Enhanced Due Diligence (EDD) is a more in-depth CDD action conducted by a PJK against Prospective Customers, WICs, or Customers, who are high risk, including Politically Exposed Persons (PEPs) and/or in high-risk areas.
High Risk Customers are Customers who, based on their background, identity, and history, are considered to have a high risk of engaging in activities related to money laundering crimes and/or terrorism financing crimes.
Suspicious Financial Transactions are suspicious financial transactions as referred to in the Law regulating the prevention and eradication of money laundering crimes and the Law regulating the prevention and eradication of terrorism financing crimes.
Cash Financial Transactions are cash financial transactions as referred to in the Law regulating the prevention and eradication of money laundering crimes.
Center for Reporting and Analysis of Financial Transactions, hereinafter abbreviated as PPATK, is the PPATK as referred to in the Law regulating the prevention and eradication of money laundering crimes.
Anti-Money Laundering and Counter-Terrorism Financing, hereinafter abbreviated as APU and PPT, are efforts to prevent and eradicate money laundering and terrorism financing crimes.
Board of Directors:
a. for PJK in the Banking Sector, PJK in the Capital Market Sector, and PJK in the Non-Bank Financial Industry Sector in the form of a limited liability company, is the Board of Directors as referred to in the Law regulating limited liability companies; b. for BPRs, insurance companies, sharia insurance companies, insurance brokerage companies, financing companies, PMVs, infrastructure financing companies, pawnshop companies, LKMs, or internet-based lending service providers in the form of a cooperative legal entity, is the management as referred to in the Law regulating cooperatives;
c. for insurance companies, sharia insurance companies, or insurance brokerage companies in the form of a joint venture legal entity, is the Board of Directors as referred to in the company's articles of association;
d. for PMVs in the form of a limited partnership business entity, is the equivalent of the Board of Directors as referred to in the company's articles of association; e. for DPLKs, is the management as referred to in the Law regulating pension funds; f. for LPEIs, is the executive director as referred to in the Law regulating LPEIs; and g. for BPRs in the form of regional public enterprises, regional limited liability companies, or regional enterprises, is the Board of Directors as referred to in the Law regulating regional governments.
Board of Commissioners:
a. for PJK in the Banking Sector, PJK in the Capital Market Sector, and PJK in the Non-Bank Financial Industry Sector in the form of a limited liability company, is the Board of Commissioners as referred to in the Law regulating limited liability companies; b. for BPRs, insurance companies, sharia insurance companies, insurance brokerage companies, financing companies, PMVs, infrastructure financing companies, pawnshop companies, LKMs, or internet-based lending service providers in the form of a cooperative legal entity, is the supervisors as referred to in the Law regulating cooperatives;
c. for insurance companies, sharia insurance companies, or insurance brokerage companies in the form of a joint venture legal entity, is the Board of Commissioners as referred to in the company's articles of association;
d. for PMVs in the form of a limited partnership business entity, is the equivalent of the Board of Commissioners as referred to in the company's articles of association; e. for DPLKs, is the supervisory board as referred to in the Law regulating pension funds; f. for LPEIs, is the board of directors as referred to in the Law regulating the Indonesia Export Financing Agency; and g. for BPRs in the form of regional public enterprises, regional limited liability companies, or regional enterprises, is the supervisors as referred to in the Law regulating regional governments.
Beneficial Owner is every person who:
a. is entitled to and/or receives certain benefits related to Customer accounts; b. is the actual owner of funds and/or securities placed with a PJK (ultimately own account);
c. controls Customer transactions;
d. grants power of attorney to conduct transactions; e. controls corporations or other legal arrangements; and/or f. is the ultimate controller of transactions conducted through legal entities or based on agreements.
Corporation is a group of persons and/or organized groups, whether legal entities or non-legal entities.
21a. Financial Action Task Force, hereinafter abbreviated as FATF, is an international body aiming to establish international standards in the prevention and eradication of money laundering, terrorism financing, and other matters threatening the integrity of the international financial system.
Financial Action Task Force Recommendations, hereinafter referred to as FATF Recommendations, are standards for the prevention and eradication of Money Laundering and/or Terrorism Financing issued by the FATF.
High Risk Countries are countries or territories that are potentially used as places where money laundering crimes occur or as instrumentalities, places where predicate crimes are committed, and/or places where terrorism financing activities are conducted.
State Institutions are institutions having authority in the executive, judicial, or legislative fields.
Government Agencies is a collective term for government organizational units that carry out their duties and functions, including:
a. coordinating ministries; b. state ministries;
c. ministries;
d. non-ministerial state institutions; e. provincial governments; f. city governments; g. regency governments; h. state institutions established by law; and
i. state institutions that carry out government functions using state revenue and expenditure budgets and/or regional revenue and expenditure budgets.
Politically Exposed Person, hereinafter abbreviated as PEP, includes:
a. Foreign PEPs are persons granted authority to perform important functions (prominent function) by other (foreign) countries, such as heads of state or government, senior politicians, senior government officials, military officials or law enforcement officials, senior executives in state-owned companies, important officials in political parties; b. Domestic PEPs are persons granted authority to perform important functions (prominent function) by the state, such as heads of state or government, senior politicians, senior government officials, military officials or law enforcement officials, senior executives in state-owned companies, important officials in political parties; and
c. Persons granted authority to perform important functions (prominent function) by international organizations, such as senior managers including but not limited to directors, deputy directors, and board members or equivalent functions.
Correspondent Banking is the activity of a bank (correspondent) in providing service services to other banks (respondents) based on a written agreement in order to provide payment services and other banking services.
Cross Border Correspondent Banking is Correspondent Banking where the position of one of the correspondent banks or respondent banks is located outside the territory of the Republic of Indonesia.
Banks are commercial banks conducting conventional business activities, including branch offices of banks located outside the country, and sharia commercial banks as referred to in the Law regulating banking.
Fund Transfer is Fund Transfer as referred to in the Law regulating Fund Transfers.
Remitting Bank is the bank that sends the Fund Transfer order.
Receiving Bank is the bank that forwards the Fund Transfer order from the Remitting Bank.
Beneficiary Bank is the bank that receives the Fund Transfer order.
Financial Group is a PJK that is in one group or cluster due to ownership and/or control linkages.
The provisions of Article 2 are amended so that they read as follows:
Article 2
(1) PJKs are required to identify, assess, and understand the risks of money laundering crimes and/or terrorism financing crimes related to customers, countries or geographical areas, products, services, transactions, or distribution networks (delivery channels). (2) In carrying out the obligations as referred to in paragraph (1), PJKs are required to:
a. document risk assessments; b. consider all relevant risk factors before determining the overall risk level, as well as the level and type of adequate risk mitigation to be implemented;
c. update risk assessments periodically; and
d. have adequate mechanisms regarding the provision of risk assessment information to competent agencies.
(3) Risk assessments as referred to in paragraph (1) must refer to Indonesia's risk assessments against money laundering crimes and terrorism financing crimes at the national level (National Risk Assessment) and at the sectoral level (Sectoral Risk Assessment).
The provisions of paragraph (3) of Article 17 are amended, and 2 (two) paragraphs are inserted between paragraph (3) and paragraph (4) of Article 17, namely paragraph (3a) and paragraph (3b), so that Article 17 reads as follows:
Article 17
(1) In order to establish business relationships with Prospective Customers, PJKs are required to:
a. identify Prospective Customers to know the profile of Prospective Customers; and b. verify the information and supporting documents of Prospective Customers as referred to in letter a. (2) PJKs are required to verify the truthfulness of the identity of Prospective Customers through face-to-face meetings with Prospective Customers at the beginning of establishing business relationships in order to confirm the truthfulness of the identity of Prospective Customers. (3) The verification process through face-to-face meetings as referred to in paragraph (2) can be replaced by verification through electronic means owned by the PJK or by third parties. (3a) Third parties as referred to in paragraph (3) must obtain approval from the Financial Services Authority. (3b) Provisions regarding the requirements and procedures for cooperation with third parties as referred to in paragraph (3) are regulated by a Financial Services Authority Regulation. (4) The verification process through face-to-face meetings as referred to in paragraph (2) can be exempted with the following provisions:
a. verification is conducted through electronic processes and means owned by the PJK and/or Prospective Customers; and b. verification must utilize population data meeting 2 (two) authentication factors.
The provisions of Article 19 remain unchanged, the explanation of Article 19 is amended as stated in the Article-by-Article Explanation in this OJK Regulation.
The provisions of paragraph (5) of Article 27 are deleted, so that it reads as follows:
Article 27
(1) PJKs are required to ensure that Prospective Customers, Customers, or WICs who establish business relationships or conduct transactions act for themselves or on behalf of Beneficial Owners. (2) In the event that Prospective Customers, Customers, or WICs act on behalf of Beneficial Owners, PJKs are required to conduct CDD on Beneficial Owners. (3) In the event that Beneficial Owners as referred to in paragraph (2) are classified as PEPs, the procedures applied are EDD procedures. (4) In the event that there is a difference in risk levels between Prospective Customers, Customers, or WICs and Beneficial Owners, the application of CDD follows the higher risk level. (5) Deleted.
The provisions of Article 28 are amended so that they read as follows:
Article 28
(1) In the event that Prospective Customers, Customers, or WICs are not Beneficial Owners, PJKs are required to identify and verify the identity of Beneficial Owners, based on relevant information or data obtained from trusted sources. (2) For Beneficial Owners of Prospective Customers, Customers, or WICs who are individual persons (natural persons), identification and verification of the identity of Beneficial Owners is conducted against information consisting of:
a. identity information and documents containing:
full name including alias;
identity document number;
place of residence according to identity documents and other places of residence;
place and date of birth;
nationality;
occupation;
address and telephone number of workplace;
gender; and
marital status;
b. source of funds;
c. average annual income;
d. purpose and objectives of the business relationship or transactions to be conducted; e. legal relationships between Prospective Customers, Customers, or WICs and Beneficial Owners, indicated by letters of assignment, agreements, powers of attorney, or other forms; and f. statements from Prospective Customers, Customers, or WICs regarding the truthfulness of the identity and source of funds of Beneficial Owners. (3) For Beneficial Owners of Prospective Customers, Customers, or WICs who are Corporations, identification and verification of the identity of Beneficial Owners from Corporations is conducted against information as referred to in paragraph (2). (4) In the event that Customers or owners or ultimate controllers of Corporations are public companies required to disclose information regarding the controllers of the respective Corporations, or subsidiaries that are majority-owned by such public companies, PJKs do not need to conduct identification and verification of shareholder data or Beneficial Owners of such public companies. (5) For Beneficial Owners of Prospective Customers, Customers, or WICs who are other legal arrangements in the form of trusts, identification and verification of the identity of Beneficial Owners is conducted against information consisting of:
a. identity of the settlor; b. identity of the trustee and manager of the trust;
c. identity of the protector;
d. identity of the beneficiary or class of beneficiaries; and e. individual persons (natural persons) who control the trust.
(6) For Beneficial Owners of Prospective Customers, Customers, or WICs who are other legal arrangements in other forms, consisting of the identity of individual persons (natural persons) who hold positions equivalent to parties in trusts as referred to in paragraph (5). (7) In the event that PJKs are uncertain whether the party controlling through ownership is a Beneficial Owner as referred to in paragraph (3), or in the event that there are no individual persons who have control through ownership, PJKs are required to identify and verify the identity of individual persons, if any, who control Corporations or legal arrangements through other forms. (8) In the event that no individual persons are identified as Beneficial Owners as referred to in paragraph (3) and paragraph (7), PJKs are required to identify and verify the identity of relevant individual persons holding positions as directors or equivalent positions. (9) In the event that Prospective Customers, Customers, or WICs are other domestic PJKs acting on behalf of and on behalf of Beneficial Owners, documents regarding Beneficial Owners may consist of written statements from Prospective Customers, Customers, or WICs.

(10) In the event that a Prospective Customer, Customer, or WIC is another Financial Institution Provider (PJK) abroad that implements an APU and PPT program that is at least equivalent to this OJK Regulation and represents a Beneficial Owner, the document regarding the Beneficial Owner shall be a written statement from the foreign PJK that the identity of the Beneficial Owner has been verified by that foreign PJK.

(11) In the event that the implementation of the APU and PPT program as referred to in paragraph (10) by a foreign PJK is not equivalent to this OJK Regulation, the PJK in question is required to implement the APU and PPT program based on this OJK Regulation.

(12) In the event that a PJK doubts or cannot verify the identity of the Beneficial Owner, the PJK is required to refuse to establish a business relationship or conduct transactions with the Prospective Customer, Customer, or WIC.

The provisions of Article 29 are amended to read as follows:

Article 29
The obligation to submit documents and/or information regarding the identity of the owner or ultimate controller of the Beneficial Owner as referred to in Article 28 does not apply to Beneficial Owners in the form of:
a. State Institutions or Government Agencies; b. companies where the majority of shares are owned by the state; or
c. public companies or issuers.

The provisions of paragraph (2) letter h of Article 30 are amended, so that Article 30 reads as follows:

Article 30
(1) PJKs are required to have an adequate risk management system to determine whether a Prospective Customer, Customer, Beneficial Owner, or WIC falls into the high-risk criteria.

(2) The high-risk criteria for Prospective Customers, Customers, Beneficial Owners, or WICs as referred to in paragraph (1) can be seen from:
a. the background or profile of the Prospective Customer, Customer, Beneficial Owner, or WIC, including High Risk Customers; b. high-risk financial services sector products that can be used as a means of Money Laundering and/or Terrorism Financing;
c. transactions with parties originating from High Risk Countries;
d. transactions that do not match the profile; e. inclusion in the PEP category; f. the business field of the Prospective Customer, Customer, Beneficial Owner, or WIC, including high-risk businesses; g. the country or territory of origin, domicile, or where the transaction of the Prospective Customer, Customer, Beneficial Owner, or WIC takes place, including High Risk Countries; h. the listing of the Prospective Customer, Customer, Beneficial Owner, or WIC in the list of suspected terrorists and terrorist organizations, and the list of Weapons of Mass Destruction Proliferation Financing; or

i. transactions conducted by the Prospective Customer, Customer, Beneficial Owner, or WIC that are suspected to be related to criminal acts in the financial services sector, Money Laundering criminal acts, and/or Terrorism Financing criminal acts.

The provisions of Article 36 are amended to read as follows:

Article 36
In the event that a PJK establishes a business relationship with Customers and/or conducts transactions originating from High Risk Countries published by the FATF to implement countermeasures, the PJK is required to conduct EDD and request confirmation and clarification from the relevant authorities.

The provisions of paragraph (1) of Article 42 are added with 1 (one) letter, namely letter e, and paragraph (2) letter c of Article 42 are amended, so that Article 42 reads as follows:

Article 42
(1) PJKs are required to refuse to establish business relationships with Prospective Customers and/or execute transactions with WICs, in the event that the Prospective Customer or WIC:
a. does not meet the provisions as referred to in Article 17, Article 20, Article 21, Article 22, Article 23, Article 24, and Article 28; b. is known and/or reasonably suspected of using fake documents;
c. provides information whose truthfulness is doubted;

d. is a shell bank or commercial bank or sharia commercial bank that allows its account to be used by a shell bank; and/or e. is listed in the list of suspected terrorists and terrorist organizations, and/or the list of Weapons of Mass Destruction Proliferation Financing.

(2) PJKs are required to refuse transactions, cancel transactions, and/or close business relationships with Customers in the event that:
a. the criteria as referred to in paragraph (1) are met; b. the source of transaction funds is known and/or reasonably suspected to originate from criminal proceeds; and/or
c. is listed in the list of suspected terrorists and terrorist organizations, and/or the list of Weapons of Mass Destruction Proliferation Financing.

(3) PJKs remain required to complete the identification and verification process of the identity of Prospective Customers or WICs and Beneficial Owners, in the event of refusal to establish business relationships with Prospective Customers and/or refusal of transactions with WICs based on the provisions as referred to in paragraph (1) letter b and letter c.

(4) In the event that a PJK suspects a financial transaction related to Money Laundering and Terrorism Financing criminal acts, and the PJK believes that the CDD process will violate anti-tipping-off regulations, the PJK is required to stop the CDD procedure and is required to report such Suspicious Financial Transactions to PPATK.

(5) PJKs are required to document Prospective Customers, Customers, or WICs that meet the criteria as referred to in paragraph (1) and paragraph (2).

(6) PJKs are required to report Prospective Customers, Customers, or WICs as referred to in paragraph (1), paragraph (2), and paragraph (3) in Suspicious Financial Transaction reports if their transactions are suspicious.

(7) The obligation of PJKs to refuse, cancel, and/or close business relationships with Customers as referred to in paragraph (2) must be included in the account opening agreement and notified to the Customer.

The title of Part Eight is amended, so that it reads as follows:

Part Eight
Monitoring and Updating

The provisions of paragraph (4) of Article 56 are amended, so that Article 56 reads as follows:

Article 56
(1) PJKs are required to archive:
a. documents related to Customer or WIC data for a period of at least 5 (five) years since:

the end of the business relationship or transaction with the Customer or WIC; or
the discovery of transaction inconsistencies with economic and/or business purposes.
b. Customer or WIC documents related to financial transactions for a period as regulated in the Law regarding corporate documents.

(2) Documents related to Customer or WIC data as referred to in paragraph (1) at least include:
a. the identity of the Customer or WIC, including supporting documents; b. transaction information which among others includes the type and amount of currency used, the date of the transaction order, the origin and destination of the transaction, and the account numbers related to the transaction;
c. the results of analysis that have been conducted; and
d. correspondence with the Customer or WIC.

(3) PJKs are required to store records and documents regarding the entire process of identifying Suspicious Financial Transactions in accordance with the provisions of applicable legislation.

(4) PJKs are required to provide data, information, and/or documents that have been archived, as soon as possible and no later than 3 (three) working days since the PJK receives a request from OJK and/or other competent authorities.

The provisions of paragraph (1) letter d and paragraph (4) of Article 62 are amended, so that Article 62 reads as follows:

Article 62
(1) PJKs are required to submit to OJK:
a. the action plan for the implementation of the APU and PPT program no later than the end of May 2017; b. the adjustment of policies and procedures for the implementation of the APU and PPT program as referred to in Article 11 no later than 6 (six) months since the implementation of this OJK Regulation; and
c. the report on the plan for data updating activities as referred to in Article 44 paragraph (4) letter b submitted every year no later than the end of December; and
d. the report on the realization of data updating as referred to in Article 44 paragraph (4) letter c submitted every year no later than 1 (one) month after the reporting period ends.

(2) In the event that the reporting date falls on a holiday, the submission of the report is conducted on the following day.

(3) In the event that there are changes to the action plan, policies and procedures for the implementation of the APU and PPT program, and the report on the plan for data updating activities, which have been submitted to OJK as referred to in paragraph (1) letters a to c, PJKs are required to submit such changes no later than 7 (seven) working days since the changes were made.

(4) The obligation of PJKs to submit reports to OJK as referred to in paragraph (1) may become part of the Director's task execution report who oversees the compliance function.

The provisions of paragraph (1) of Article 65 are amended, so that Article 65 reads as follows:

Article 65
(1) PJKs that are late in submitting reports as referred to in Article 62 and Article 63 are subject to administrative sanctions in the form of fines, namely the obligation to pay a certain amount of money with the following details:

a. amounting to Rp100,000.00 (one hundred thousand rupiah) per day of delay per report and at most Rp10,000,000.00 (ten million rupiah) for PJKs in the form of commercial banks, sharia commercial banks, securities companies, insurance companies, sharia insurance companies, DPLKs, infrastructure financing companies, LPEIs, and investment managers; or b. amounting to Rp50,000.00 (fifty thousand rupiah) per day of delay per report and at most Rp5,000,000.00 (five million rupiah) for PJKs in the form of rural banks (BPR), sharia rural banks (BPRS), financing companies, insurance brokerage companies, pawnshop companies, and PMVs.

(2) LKMs and digital lending service providers that are late in submitting reports as referred to in Article 62 and Article 63 are subject to administrative sanctions in the form of written warnings.

The provisions of Article 66 are amended, so that Article 66 reads as follows:

Article 66
(1) Violations of the provisions as referred to in this OJK Regulation, other than violations regarding the late submission of reports, are subject to administrative sanctions in the form of:
a. written warnings or reprimands; b. fines in the form of the obligation to pay a certain amount of money;
c. downgrade in the level of health assessment;
d. restriction of certain business activities; e. suspension of certain business activities;

f. dismissal of Bank executives and subsequently appointing and appointing temporary replacements until the general meeting of shareholders or cooperative members appoint permanent replacements with OJK approval; and/or g. listing of members of the Board of Directors and members of the Board of Commissioners, PJK employees, and shareholders in the list of persons with bad reputation in the financial services sector.

(2) Sanctions as referred to in paragraph (1) letters b to g may be imposed with or without prior imposition of written warning sanctions as referred to in paragraph (1) letter a.

(3) Fine sanctions as referred to in paragraph (1) letter b may be imposed separately or together with the imposition of sanctions as referred to in paragraph (1) letters c to g.

(3a) Fine sanctions as referred to in paragraph (1) letter b may be imposed at most amounting to Rp5,000,000,000.00 (five billion rupiah) for individuals and at most amounting to Rp15,000,000,000.00 (fifteen billion rupiah) for companies.

(4) OJK may announce the imposition of administrative sanctions as referred to in paragraph (1) to the public/society.

The provisions of paragraph (1) of Article 51 are amended and 1 (one) paragraph is added, namely paragraph (3), so that Article 51 reads as follows:

Article 51
(1) For Banks conducting Fund Transfer activities both within the territory of Indonesia and cross-border, the following provisions apply:
a. The Sending Bank is required to:

obtain information and conduct identification and verification of the Sending Customer/WIC and/or Receiving Customer/WIC, at least including:
a) name of the Sending Customer or WIC; b) account number of the Sending Customer; c) address of the Sending Customer or WIC; d) identity document number, identification number, or place and date of birth of the Sending Customer or WIC; e) source of funds of the Sending Customer or WIC; f) name of the Receiving Customer or WIC; g) account number of the Receiving Customer; h) address of the Receiving WIC; i) amount of money and type of currency; and j) date of transaction;
submit the information as referred to in number 1 to the Continuing Bank or Receiving Bank; and
archive all Fund Transfer transactions;
b. The Continuing Bank is required to forward the message and Fund Transfer order, and archive the information received from the Sending Bank or other Continuing Banks for a minimum period of 5 (five) years since the receipt of the Fund Transfer order from the Sending Bank or other Continuing Banks; and
c. The Receiving Bank is required to ensure the completeness of the Sending Customer and Sending WIC information as referred to in letter a number 1.

(2) For Fund Transfer activities within the territory of Indonesia, the Sending Bank is required to submit in writing the information needed within a maximum of 3 (three) working days based on a written request from the Receiving Bank, and/or from competent authorities if the Receiving Bank only obtains the account number or transaction reference number.

(3) The Receiving Bank is required to verify the identity of the Receiving Customer or WIC in the event that the identity has not been verified previously, and archive the information in accordance with the document archiving provisions in this OJK Regulation.

Between paragraph (1) and paragraph (2) of Article 54, 2 (two) paragraphs are inserted, namely paragraph (1a) and paragraph (1b), so that Article 54 reads as follows:

Article 54
(1) In the event that the information as referred to in Article 51 paragraph (1) letter a number 1 is not met, the Sending Bank is required to refuse to execute the Fund Transfer.

(1a) In the event that a Continuing Bank receives a transfer order from a Sending Bank abroad that is not equipped with information as referred to in Article 51 paragraph (1) letter a number 1, the Continuing Bank is required to take adequate measures, consistent with straight-through processing, to identify Fund Transfers that are not equipped with such information.

(1b) In the event that a Receiving Bank receives a transfer order from a Sending Bank or Continuing Bank abroad that is not equipped with information as referred to in Article 51 paragraph (1) letter a number 1, the Receiving Bank is required to take adequate measures to identify Fund Transfers that are not equipped with such information, which may include monitoring at the time or after the Fund Transfer is executed.

(2) In the event that a Continuing Bank and/or Receiving Bank receives a transfer order from a Sending Bank abroad that is not equipped with information as referred to in Article 51 paragraph (1) letter a number 1, the Continuing Bank and/or Receiving Bank may:
a. execute the Fund Transfer; b. refuse to execute the Fund Transfer; or
c. postpone the Fund Transfer transaction, accompanied by adequate follow-up.

(3) In determining the actions as referred to in paragraph (2), the Continuing Bank and/or Receiving Bank is required to have risk-based policies and procedures.

The provisions of paragraph (4) of Article 56 are amended, so that Article 56 reads as follows:

Article 56
(1) PJKs are required to archive:
a. documents related to Customer or WIC data for a period of at least 5 (five) years since:

the end of the business relationship or transaction with the Customer or WIC; or
the discovery of transaction inconsistencies with economic and/or business purposes.
b. Customer or WIC documents related to financial transactions for a period as regulated in the Law regarding corporate documents.

(3) PJKs are required to store records and documents regarding the entire process of identifying Suspicious Financial Transactions in accordance with the provisions of applicable legislation.

The provisions of paragraph (1) letter d and paragraph (4) of Article 62 are amended, so that Article 62 reads as follows:

(2) In the event that the reporting date falls on a holiday, the submission of the report is conducted on the following day.

(4) The obligation of PJKs to submit reports to OJK as referred to in paragraph (1) may become part of the Director's task execution report who oversees the compliance function.

The provisions of paragraph (1) of Article 65 are amended, so that Article 65 reads as follows:

(2) LKMs and digital lending service providers that are late in submitting reports as referred to in Article 62 and Article 63 are subject to administrative sanctions in the form of written warnings.

The provisions of Article 66 are amended, so that Article 66 reads as follows:

(2) Sanctions as referred to in paragraph (1) letters b to g may be imposed with or without prior imposition of written warning sanctions as referred to in paragraph (1) letter a.

(3) Fine sanctions as referred to in paragraph (1) letter b may be imposed separately or together with the imposition of sanctions as referred to in paragraph (1) letters c to g.

(4) OJK may announce the imposition of administrative sanctions as referred to in paragraph (1) to the public/society.

Add 1 (one) paragraph to Article 67, namely paragraph (3), so that it reads as follows:

Article 67
(1) PJKs that already have policies and procedures for the implementation of the APU and PPT program are required to adjust the aforementioned policies and procedures in accordance with this OJK Regulation, no later than 6 (six) months since this OJK Regulation is promulgated.

(2) For LKMs and digital lending service providers, the provisions in this OJK Regulation are declared to be effective after 4 (four) years counted from the date this OJK Regulation is promulgated.

(3) PJKs that violate the provisions on the implementation of the APU and PPT program in the financial services sector before the implementation of OJK Regulation Number 12/POJK.01/2017 on the Implementation of Anti-Money Laundering and Counter-Terrorism Financing Programs in the Financial Services Sector, the examination and decisions regarding such violations are based on the regulations regarding the implementation of the APU and PPT program that were in effect at the time the violation occurred, with the imposition of sanctions as regulated in Article 65 and Article 66 paragraph (1) letters a, c, d, e, f, g, paragraph (2), paragraph (3), and paragraph (4) of this OJK Regulation.

Article II
This OJK Regulation takes effect on the date of its promulgation.

This copy is in accordance with the original.
Legal Director 1
Legal Department signed
Yuliana

To ensure everyone knows it, order the promulgation of this OJK Regulation by placing it in the State Gazette of the Republic of Indonesia.

Decreed in Jakarta on 18 September 2019
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signed
WIMBOH SANTOSO

Promulgated in Jakarta on 30 September 2019
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signed
YASONNA H. LAOLY

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2019 NUMBER 178

EXPLANATION OF
FINANCIAL SERVICES AUTHORITY REGULATION
REPUBLIC OF INDONESIA
NUMBER 23/POJK.01/2019
ON
AMENDMENT TO FINANCIAL SERVICES AUTHORITY REGULATION NUMBER 12/POJK.01/2017 ON THE IMPLEMENTATION OF ANTI-MONEY LAUNDERING AND COUNTER-TERRORISM FINANCING PROGRAMS IN THE FINANCIAL SERVICES SECTOR

I. GENERAL
As a form of implementation of United Nations Security Council Resolutions regarding the prevention of Weapons of Mass Destruction Proliferation, Indonesia has issued a Joint Regulation of the Minister of Foreign Affairs of the Republic of Indonesia, Head of the National Police of the Republic of Indonesia, Head of the Center for Financial Transaction Reports and Analysis, and Head of the Nuclear Energy Regulatory Agency regarding the Listing of the Identity of Persons or Corporations in the Weapons of Mass Destruction Proliferation Financing List, to maintain world security and peace which is the national goal of the Unitary State of the Republic of Indonesia.

In response to the above, OJK deems it necessary to add new provisions regarding the obligation for PJKs to take several follow-up steps regarding the Weapons of Mass Destruction Proliferation Financing List, among others data maintenance, identification and verification of identity consistency, and Immediate Blocking.

Furthermore, to support law enforcement processes, particularly regarding data and information requests from Financial Service Providers, the regulation needs to be refined to further prioritize the acceleration of data and information submission to law enforcement agencies. Subsequently, to mitigate risks in fund transfer activities, it is necessary to refine the regulations with provisions affirming verification activities by the Receiving Bank, particularly regarding identities that have not been verified previously, and document archiving in Fund Transfer activities.

In relation to these matters, OJK establishes the Amendment to Financial Services Authority Regulation Number 12/POJK.01/2017 on the Implementation of Anti-Money Laundering and Counter-Terrorism Financing Programs in the Financial Services Sector.

II. ARTICLE BY ARTICLE
Article I
Number 1
Article 1
It is clear enough.

Number 2
Article 2
Paragraph (1)
It is clear enough.

Paragraph (2)
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
The term "periodically" means conducted at least 1 (one) time in 1 (one) year or determined according to the needs and risk assessment of the PJK.

Letter d
It is clear enough.

Paragraph (3)
The term "Indonesia's National Risk Assessment against Money Laundering and Terrorism Financing Criminal Acts" refers to a document issued by PPATK containing the results of Indonesia's risk assessment against Money Laundering Criminal Acts (TPPU) and Terrorism Financing Criminal Acts (TPPT) nationally and its amendments.

The term "Indonesia's Sectoral Risk Assessment against Money Laundering and Terrorism Financing Criminal Acts" refers to a document issued by relevant authorities such as OJK or the Commodity Futures Trading Regulatory Agency containing the results of risk assessment of each industry or sector against potential TPPU and TPPT and its amendments.

Number 3
Article 17
Paragraph (1)
Letter a
In order to identify Prospective Customers to know their profile, PJKs may be represented by other parties, with the provision that the Other Party representing the PJK must know the basic principles of CDD.

Letter b
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
The implementation of face-to-face verification via electronic media owned by the PJK, among others, can be conducted through video banking using devices owned by the PJK that are directly online with officers from the PJK.

Paragraph (3a)
It is clear enough.

Paragraph (3b)
It is clear enough.

Paragraph (4)
Letter a
It is clear enough.

Letter b
The term "2 (two) factor authentication" includes:

what you have is the identity document owned by the Prospective Customer, namely the Electronic Identity Card (KTP); and
what you are is biometric data, among others in the form of fingerprints of the Prospective Customer.

Number 4
Article 19
The term "Corporation" among others includes companies, foundations, cooperatives, religious associations, political parties, non-governmental organizations or non-profit organizations, and community organizations.

Number 5
Article 27
It is clear enough.

Number 6
Article 28
Paragraph (1)
What is meant by "reliable source" is a party that can provide or supply information as a verification source.
Paragraph (2)
Letter a
Number 1
The inclusion of an alias is required in the event that the Beneficial Owner has another name.
Number 2
It is sufficiently clear.
Number 3
The inclusion of another residential address is supplemented in the event that the Beneficial Owner has an address other than that stated in the identity document.
Number 4
It is sufficiently clear.
Number 5
It is sufficiently clear.
Number 6
It is sufficiently clear.
Number 7
The inclusion of the work address and telephone number is supplemented in the event that the Beneficial Owner is an owner or employee of a company.
Number 8
It is sufficiently clear.
Number 9
It is sufficiently clear.
Letter b
It is sufficiently clear.

Letter c
It is sufficiently clear.
Letter d
It is sufficiently clear.
Letter e
It is sufficiently clear.
Letter f
It is sufficiently clear.
Paragraph (3)
It is sufficiently clear.
Paragraph (4)
Relevant data related to shareholders or Beneficial Owners that are identified can be obtained from competent authorities, Customers, or other reliable sources.
Paragraph (5)
Letter a
It is sufficiently clear.
Letter b
It is sufficiently clear.
Letter c
Identity information of the guarantor is carried out in the event that a trust agreement has a guarantor in its legal relationship.
Letter d
It is sufficiently clear.
Letter e
It is sufficiently clear.
Paragraph (6)
It is sufficiently clear.
Paragraph (7)
It is sufficiently clear.
Paragraph (8)
It is sufficiently clear.
Paragraph (9)
It is sufficiently clear.

Paragraph (10)
What is meant by "equivalent" is having provisions whose substance is substantially the same in principle with this OJK Regulation, which is based on FATF Recommendations.
Paragraph (11)
It is sufficiently clear.
Paragraph (12)
It is sufficiently clear.
Number 7
Article 29
It is sufficiently clear.
Number 8
Article 30
Paragraph (1)
It is sufficiently clear.
Paragraph (2)
Letter a
It is sufficiently clear.
Letter b
What is meant by "high-risk financial services sector products" includes:

private banking;
anonymous transactions (including cash transactions); or
payments received from unknown third parties or parties that are not related.
Letter c
Examples of High Risk Countries include:
Jurisdictions that are identified by organizations that conduct mutual assessments of a country (such as: Financial Action Task Force on Money Laundering (FATF), Asia Pacific Group on Money Laundering (APG),

Caribbean Financial Action Task Force
(CFATF), Committee of Experts on the
Evaluation of Anti-Money Laundering
Measures and the Financing of Terrorism
(MONEYVAL), Eastern and Southern Africa
Anti-Money Laundering Group (ESAAMLG),
The Eurasian Group on Combating Money
Laundering and Financing of Terrorism (EAG),
The Grupo de Accion Financiera de
Sudamerica (GAFISUD), Intergovernmental
Anti-Money Laundering Group in Africa
(GIABA) or Middle East & North Africa
Financial Action Task Force (MENAFATF)) as not adequately implementing FATF Recommendations;
2. Countries identified as Non-Cooperative or Tax Haven by the Organization for Economic Cooperation and Development (OECD);
3. Countries with a low level of good governance as determined by the World Bank;
4. Countries with a high level of corruption risk as identified in the Transparency International Corruption Perception Index;
5. Countries that are widely known as drug production and trafficking centers;
6. Countries subject to sanctions, embargoes, or similar measures, including by the UN; or
7. Countries or jurisdictions identified by trusted institutions as funding or supporting terrorist activities, or allowing terrorist organization activities in their country.

Letter d
It is sufficiently clear.
Letter e
It is sufficiently clear.
Letter f
It is sufficiently clear.
Letter g
It is sufficiently clear.
Letter h
Information on Prospective Customers, Customers, Beneficial Owners, or WICs that are listed in the list of suspected terrorists and terrorist organizations can be sourced from:

The Indonesian National Police;
United Nations Security Council Resolutions; or
other commonly used sources.
Information on Prospective Customers, Customers, Beneficial Owners, or WICs that are listed in the list of Weapons of Mass Destruction Proliferation Financing can be sourced from:
PPATK;
United Nations Security Council Resolutions; or
other commonly used sources.
Letter i
It is sufficiently clear.
Number 9
Article 36
What is meant by "competent authority" is PPATK. Requests for confirmation and clarification are intended to determine other countermeasure actions, including:
introducing relevant reporting mechanisms or systematic financial transaction reporting;
prohibiting the establishment of branch offices or representative offices in the respective country, or considering that the branch office or representative office in question is located in a country that does not have an adequate APU PPT system;
restricting business relationships or financial transactions with countries or persons identified in that country;
prohibiting reliance on third parties located in the respective country to carry out the CDD process; or
requesting to review and change, or if necessary terminate, correspondent relationships with financial institutions in the respective country.
Number 10
Article 42
Paragraph (1)
Letter a
It is sufficiently clear.
Letter b
It is sufficiently clear.
Letter c
It is sufficiently clear.
Letter d
What is meant by "shell bank" is a bank that does not have a physical presence in the legal territory where the bank was established and licensed, and is not affiliated with a financial services financial group that is subject to effective consolidated supervision. Letter e It is sufficiently clear. Paragraph (2) It is sufficiently clear.

Paragraph (3)
The obligation of Financial Service Providers to continue to carry out the identification and verification process of the identity of Prospective Customers or WICs and Beneficial Owners is intended for the purpose of reporting Suspicious Financial Transactions to PPATK. Paragraph (4) It is sufficiently clear. Paragraph (5) It is sufficiently clear. Paragraph (6) It is sufficiently clear. Paragraph (7) It is sufficiently clear. Number 11 It is sufficiently clear. Number 12
Article 44
Paragraph (1)
It is sufficiently clear.
Paragraph (2)
Updates to identity documents are carried out, among others, when there are financial transactions that meet the criteria for Suspicious Financial Transactions as referred to in legislation governing the prevention and eradication of money laundering crimes. In carrying out data updates, Financial Service Providers pay attention to materiality and risk levels, and are carried out at the right time through a review of Customer profiles and transactions, considering the time of CDD implementation that was previously carried out and the adequacy of data obtained.

Paragraph (3)
It is sufficiently clear.
Paragraph (4)
Data update plans include quantitative data and qualitative data.
What is meant by "quantitative data" includes statistics on the number of Customers whose data has or has not been updated.
What is meant by "qualitative data" includes obstacles, efforts made by Financial Service Providers, and progress of such efforts.
Paragraph (5)
It is sufficiently clear.
Number 13
Article 46
Paragraph (1)
What is meant by "list of suspected terrorists and terrorist organizations" is a list issued by the Head of the Indonesian National Police based on a decision of the Central Jakarta District Court. What is meant by "Weapons of Mass Destruction Proliferation Financing list" is a list established by PPATK. Paragraph (2) It is sufficiently clear. Paragraph (3) What is meant by "other information" includes, among others, place and date of birth and Customer address.

Paragraph (4)
In carrying out Blocking and reporting, Financial Service Providers refer to the Joint Regulation on the Inclusion of Identity of Persons and Corporations in the List of Suspected Terrorists and Terrorist Organizations and Immediate Blocking of Funds Owned by Persons or Corporations Listed in the List of Suspected Terrorists and Terrorist Organizations and the Joint Regulation on the Inclusion of Identity of Persons and Corporations in the Weapons of Mass Destruction Proliferation Financing List and Immediate Blocking of Funds Owned by Persons or Corporations Listed in the Weapons of Mass Destruction Proliferation Financing List. Paragraph (5) It is sufficiently clear. Paragraph (6) It is sufficiently clear. Number 14
Article 51
Paragraph (1)
Letter a
What is meant by "Sending Bank" includes banks that conduct business activities as agents for money transfer service providers.
Number 1
Letter a)
It is sufficiently clear.
Letter b)
It is sufficiently clear.
Letter c)
It is sufficiently clear.

Letter d)
What is meant by "identification number" includes a number that uniquely identifies the Customer/WIC sender from the Sending Bank with data information managed by the Sending Bank. In this case, the identification number is different from the transaction number. Letter e) It is sufficiently clear. Letter f) It is sufficiently clear. Letter g) It is sufficiently clear. Letter h) It is sufficiently clear. Letter i) It is sufficiently clear. Letter j) It is sufficiently clear. Number 2 It is sufficiently clear. Number 3 What is meant by "record-keeping" is the record-keeping activity as referred to in Article 56 of this OJK Regulation. Letter b It is sufficiently clear. Letter c It is sufficiently clear. Paragraph (2) Information or written requests can be in the form of signed letters or information or requests submitted through other electronic media.

What is meant by "competent authority" includes law enforcement authorities with regard to laws governing confidentiality.
Paragraph (3)
It is sufficiently clear.
Number 15
Article 54
Paragraph (1)
It is sufficiently clear.
Paragraph (1a)
What is meant by "straight-through processing" refers to payment transactions carried out electronically without any manual intervention.
Paragraph (1b)
It is sufficiently clear.
Paragraph (2)
What is meant by "adequate follow-up" includes, among others:
a. identifying Fund Transfers that are not accompanied by required information; b. conducting stricter monitoring, either post-event monitoring or real-time monitoring; and/or
c. reporting as a Suspicious Financial Transaction.
Letter a
It is sufficiently clear.
Letter b
It is sufficiently clear.
Letter c
It is sufficiently clear.
Paragraph (3)
It is sufficiently clear.

Number 16
Article 56
Paragraph (1)
One of the purposes of record-keeping of the documents mentioned is to facilitate transaction reconstruction when requested by competent authorities.
Documents can be kept in original form, copies, electronic form, microfilm, or documents that can be used as evidence based on applicable laws.
Paragraph (2)
It is sufficiently clear.
Paragraph (3)
It is sufficiently clear.
Paragraph (4)
What is meant by "other competent authorities" includes law enforcement authorities.
Number 17
Article 62
Paragraph (1)
Letter a
What is meant by "Action plan" is the steps taken by Financial Service Providers to implement the APU and PPT program with a completion time target for a certain period, which at a minimum contains improvements to infrastructure related to information technology, preparation of human resources, and Customer, WIC, and Beneficial Owner data update programs. Action Plans also include steps taken by Financial Service Providers to carry out CDD on existing Customers based on their materiality and risk.

In the event that Financial Service Providers have submitted an action plan to OJK before this OJK Regulation takes effect, Financial Service Providers are only required to submit adjustments to the action plan for the implementation of the APU and PPT program. Letter b It is sufficiently clear. Letter c Data update plans are prepared in accordance with the Financial Service Provider's assessment of the adequacy of available data. These activity plans help Financial Service Providers to monitor and report Suspicious Financial Transactions. Letter d What is meant by "reporting period" is the period for submitting reports on the realization of data updates ending on December 31st. Paragraph (2) It is sufficiently clear. Paragraph (3) It is sufficiently clear. Paragraph (4) It is sufficiently clear. Number 18
Article 65
It is sufficiently clear.
Number 19
Article 66
It is sufficiently clear.
Number 20
Article 67
It is sufficiently clear.

Article II
It is sufficiently clear.
SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6394 ---

Financial Services Authority Regulation Number 23/POJK.01/2019 Regarding Amendments to Financial Services Authority Regulation Number 12/POJK.01/2017 on the Implementation of Anti-Money Laundering and Counter-Terrorism Financing Programs in the Financial Services Sector

Lineage: Amended

Timeline