10 A REPORTING OBLIGATIONS OF BANKS
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What is the primary legislation governing reporting obligations of banks in India under AML/CFT?
The Prevention of Money Laundering Act, 2002 (PMLA) is the primary legislation, supplemented by the PMLA Rules 2005, which mandate banks to report specified financial transactions to the Financial Intelligence Unit-India (FIU-IND).
What is the threshold amount for filing a Cash Transaction Report (CTR) with FIU-IND?
Transactions of Rs. 10 lakh or more in cash must be reported.
What is FIU-IND and what is its role in the AML reporting framework?
FIU-IND (Financial Intelligence Unit – India) is the central national agency responsible for receiving, processing, analysing, and disseminating information relating to suspect financial transactions to enforcement agencies and foreign FIUs.
Within how many days must a bank file a Suspicious Transaction Report (STR) after identifying a suspicious transaction?
STR must be filed within 7 days of forming suspicion.
What is a Cash Transaction Report (CTR) and who must file it?
A CTR must be filed for all cash transactions of Rs. 10 lakh and above, or transactions of equivalent value in foreign currency, in a single day. Banks and other reporting entities are required to submit CTRs to FIU-IND by the 15th of the succeeding month.
What is the full form of FIU-IND in the context of AML reporting?
Financial Intelligence Unit – India is the central agency receiving reports.
What is a Suspicious Transaction Report (STR) and when must it be filed?
An STR must be filed when a bank has reasonable grounds to believe that a transaction is suspicious, irrespective of the amount involved. It must be reported to FIU-IND within 7 days of arriving at a conclusion that the transaction is suspicious.
Under which act are banks in India primarily obligated to report suspicious transactions?
Prevention of Money Laundering Act (PMLA), 2002 mandates this reporting.
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