MTN Mobile Money 2012 - beta.mtn.co.ugbeta.mtn.co.ug/Downloads/Fraud awareness manual.pdf · ©2011 Mobile Telephone Networks. All rights reserved.© 2008 MTN Uganda LtdAll rights

MTN Mobile Money 2012

© 2008 MTN Uganda LtdAll rights reserved.©2011 Mobile Telephone Networks. All rights reserved. 2

Anti-Money LaunderingIt is the policy of MTN to prohibit and actively

prevent the use of its money transfer services to

facilitate money laundering, the funding of terrorists or

criminal activity

This session is designed to provide you with

information and guidance as to how to comply with

your Anti-Money Laundering (AML) responsibilities

The session covers:-

- Know Your Customer (KYC) Procedure

- Suspicious Activity Reporting


Why Are We Concerned?


Why Are We Concerned?

Uganda is strategically placed within the East &

Central Africa region

Due to lack of a National Identity card system,

people may seek to take advantage of identity fraud

The need to keep Uganda free from underhand

activities

A local & International obligation & requirement

Nature of criminal activities generate financial

assets

The need to protect Uganda‟s financial systems


Money Laundering Risks in Mobile Money

Convenient, fast & cheap means of:-

Transferring funds to persons (countries)

Making payments of goods & services

Storing of funds in the account

Reliance on partner agents to conduct

important regulatory checks & controls

Agents lack the rigorous screening process of

traditional banks

Lack of national identity card system in further

complicates the issue


What is Money Laundering?

Definition: Engaging in acts designed to conceal or disguise the true origin of illegally acquired proceeds [goods, assets, etc] so that these unlawful proceeds appear to have originated from legitimate sources or constitute legitimate proceeds

It is the process of making criminal assets appear legitimate

Examples in the Ugandan Scenario:

Proceeds from child traffickers, car jacking, wildlife

poaching, etc

How is Money Laundering done? – by conducting one or a series of legitimate financial and commercial transactions


Stages of Money Laundering Placement – where illegal/black money is “placed” into anaccount (MTN Mobile Money)without arousing suspicion

Layering – where illegal/black money will be moved aroundfrom account to account (including direct deposits). This ofteninvolves reducing the funds into smaller amounts and usingdifferent people & business to try and disguise its original source

Integration – where illegal/black money is put back into thelegal financial system and appears to be legitimate funds or assets(withdrawn from MTN Mobile Money and put in a bank account orused to purchase goods & services)

Why is this done?

–to hide the true origin of the assets

–make detection of proceeds of crime by law enforcement agenciesdifficult


Effects of Money Laundering?

Encourages criminals to continue with their illegal actsbecause they get to spend the profits withoutrepercussions

Results in more fraud, more corporate organizations losingmoney (people‟s pension lost), more drugs in the street

Laundered money is usually untaxed, which means the restof us have to pay to make up for the tax shortfalls

Small to medium size businesses like MTN MM agentsunable to compete with others who only act as a front sincethey make abnormal profits, or their intention is just to cleanmoney hence may offer services at a lower price thannormal


How do we fight it?

KYC – Know Your Customer

In any Money Laundering operation, the first step is

always opening the account where the proceeds of

crime can be placed

Therefore, confirmation of identity is mandatory and

KYC is crucial

Agents & staff are our first line of defense against

money laundering & territory financing

By knowing your customer, you will be able to

understand what is potentially suspicious

Transactions that are not consistent with the known

circumstances of the customer should raise suspicions


How do we fight it?

Reporting Suspicious Activity

It‟s important as it protects you from the

liability of a money laundering offence

Always proceed with transaction otherwise it

may be seen as tipping off

Reporting must only be done to the Anti-

Money Laundering Compliance Officer (AMLO)

A suspicious activity report form needs to be

filled when making such a report


KYC Procedure

As an Agent, it is your responsibility to ensure that

ALL transactions [registrations, withdrawals &

deposits] are carried out with proof of identity

Acceptable identification documents are: Valid

Passport, L/C certificate, Driver‟s License, Voter‟s

card, Military ID, Tax certificate [All Original]

For registration purposes, customer must also avail

a copy of the ID presented and after verification, fill in

the customer registration form


KYC Procedure

For value transactions [deposits & withdrawals],

agent first verifies the ID document presented, then

only after that may continue with the transaction

Counterfeit, photocopies and expired documents

are not acceptable for transacting

Where a valid & original identification cannot be

produced, the transaction must be declined

Customer registrations and transactions MUST only

happen with face-to-face customers [you must decline

transactions for no face-to-face customers]


Transactions Monitoring

MTN has the necessary tools to identify instances of

Agents defrauding customers. These tools include:-

SIM replacement information details

Location details

Call Information

Handset information

Transaction monitoring reports to identify agents

inflating commissions by breaking down transactions;

registrations using fake IDs; direct deposits; etc

Non-compliance to KYC & AML will lead to Agent

being penalized as per penalties guideline


Examples of Money Laundering:

Customer submits copies of identification

documents while refusing to present the originals

without any rational reasons

Customer provides identification documents which

are suspected to be forged or false

Customer conducts a series of large deposits and

withdrawals within a short period of time

Customer deposits very dirty or moist currency

notes

Multiple deposits into an account by third parties

Customer conducts frequent transactions just below

the thresholds


Confronted with a suspicious transaction?

Ask the right questions without raising

suspicion

Do not tip-off; treat your suspicion

confidentially

Treat all customers with courtesy – suspicious

or not, they should all be treated with courtesy

Continue with the transaction – whether it‟s

one or several transactions, carry on as usual

Immediately report the suspicion or unusual

transaction to the MLCO


Important to Note:

No civil or criminal action will be taken

against MTN or its agents for reports made

in good faith

You are NOT TO disclose the information

to anyone other than the MTN officer

authorized (MLCO)

Do not inform or „tip-off‟ the customer

[tipping off is an offence]

Agents must ensure confidentiality

Thank you.

Documents

MTN Mobile Money 2012 - beta.mtn.co.ugbeta.mtn.co.ug/Downloads/Fraud awareness manual.pdf · ©2011 Mobile Telephone Networks. All rights reserved.© 2008 MTN Uganda LtdAll rights