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MTN Mobile Money 2012

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

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  • 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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 3

    Why Are We Concerned?

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 4

    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 Ugandas financial systems

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 5

    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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 6

    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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 7

    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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 8

    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 (peoples 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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 9

    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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 10

    How do we fight it?

    Reporting Suspicious Activity

    Its 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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 11

    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, Drivers License, Voters

    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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 12

    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]

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 13

    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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 14

    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

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 15

    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 its

    one or several transactions, carry on as usual

    Immediately report the suspicion or unusual

    transaction to the MLCO

  • 2008 MTN Uganda LtdAll rights reserved.2011 Mobile Telephone Networks. All rights reserved. 16

    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.