AMBIGUITY IN IMPLEMENTING INSTRUCTIONS IN CONNECTION WITH INTRODUCTION OF ANTI-MONEY LAUNDERING / COMBATING OF FINANCE OF TERRORISM NORM FOR SMALL SAVINGS SCHEME
Dear friends,
In the meantime you might have gone through the instructions contained in Directorate letter No. 109-04/2007-SB, dated 23.04.2010 circulated vide C O letter No.Sb / SB Order / 09, dated 27.04.2010 regarding Introduction of Anti-Money Laundering / Combating of Finance of Terrorism norm for Small Savings Scheme. While going on for implementation of the instructions contained in Annexure – I of the above Directorate letter under head “ Record Keeping” directing to paste the third copy of the investor’s photograph in the Register as prescribed in Rule 37 ( 1 ) of POSB Manual , Volume – 1 and many other instructions, you might have confronted with some ambiguities. Have you analyzed the instructions now circulated in the context of the rules and procedures of the POSB Manual Volume – I ?
With refreshment of existing rules, let’s have a brief discussion.
Rule – 37 ( 1 ) of POSB Manual, Volume – I categorically states as follows:
(a) : A depositor of a Savings Account standing at a Head, Sub or Branch Post Office may furnish to the Post Office his passport size photograph which, after verification, will be kept on record in the post office for identification of the depositor at the time of withdrawal. The photograph will be pasted in a register with the following columns :-
(i) Serial Number, (ii) Number of the Account, (iii) Name of the depositor
(iv) Signature of Postmaster, (v) Photograph of the depositor (vi) Remarks.
A remark will be made on the application form SB-3 or against the specimen signature in the specimen signature book to this effect noting the serial number of the photograph as per the register. The photograph will be attested by the Postmaster. He will also write the name of the depositor on the photograph. The serial number assigned to the photograph in the register will be noted on the first page of the pass book by making the following remark "photograph available at serial number ………………" under the dated signature of the Postmaster. The register of photographs will be kept in the custody of the Postmaster.
(b) When an application for withdrawal is presented at the counter, the normal procedure for verifying the signature will be followed. On occasions when the signature is found to differ from the specimen on record and the identity of the depositor is required to be established, the photograph on record will be scrutinized personally by the Postmaster. In case the Postmaster is satisfied with the identity of the depositor after such scrutiny, the withdrawal will be allowed making a suitable remark on the application for withdrawal to the effect that "the depositor has been identified with reference to his photograph on record." The remark will be signed by the Postmaster.
(c) The facility will be available only when the depositor personally attends the post office. The photograph shall be used only as a means of identification. When the account is transferred from the office, the depositor may be advised to have a fresh photograph registered at the new office.
(d) This facility can be used by illiterate depositors too. In such cases, there will be no need for that witness being known to the post office as he is only to witness and certify the amount actually paid. The address of the witness will however have to be noted on the withdrawal form below his signature.
If the above ruling position is analyzed in the context of the instructions contained in Directorate letter No. 109-04/2007-SB, dated 23.04.2010, the following ambiguities are forthcoming.
Dear friends,
In the meantime you might have gone through the instructions contained in Directorate letter No. 109-04/2007-SB, dated 23.04.2010 circulated vide C O letter No.Sb / SB Order / 09, dated 27.04.2010 regarding Introduction of Anti-Money Laundering / Combating of Finance of Terrorism norm for Small Savings Scheme. While going on for implementation of the instructions contained in Annexure – I of the above Directorate letter under head “ Record Keeping” directing to paste the third copy of the investor’s photograph in the Register as prescribed in Rule 37 ( 1 ) of POSB Manual , Volume – 1 and many other instructions, you might have confronted with some ambiguities. Have you analyzed the instructions now circulated in the context of the rules and procedures of the POSB Manual Volume – I ?
With refreshment of existing rules, let’s have a brief discussion.
Rule – 37 ( 1 ) of POSB Manual, Volume – I categorically states as follows:
(a) : A depositor of a Savings Account standing at a Head, Sub or Branch Post Office may furnish to the Post Office his passport size photograph which, after verification, will be kept on record in the post office for identification of the depositor at the time of withdrawal. The photograph will be pasted in a register with the following columns :-
(i) Serial Number, (ii) Number of the Account, (iii) Name of the depositor
(iv) Signature of Postmaster, (v) Photograph of the depositor (vi) Remarks.
A remark will be made on the application form SB-3 or against the specimen signature in the specimen signature book to this effect noting the serial number of the photograph as per the register. The photograph will be attested by the Postmaster. He will also write the name of the depositor on the photograph. The serial number assigned to the photograph in the register will be noted on the first page of the pass book by making the following remark "photograph available at serial number ………………" under the dated signature of the Postmaster. The register of photographs will be kept in the custody of the Postmaster.
(b) When an application for withdrawal is presented at the counter, the normal procedure for verifying the signature will be followed. On occasions when the signature is found to differ from the specimen on record and the identity of the depositor is required to be established, the photograph on record will be scrutinized personally by the Postmaster. In case the Postmaster is satisfied with the identity of the depositor after such scrutiny, the withdrawal will be allowed making a suitable remark on the application for withdrawal to the effect that "the depositor has been identified with reference to his photograph on record." The remark will be signed by the Postmaster.
(c) The facility will be available only when the depositor personally attends the post office. The photograph shall be used only as a means of identification. When the account is transferred from the office, the depositor may be advised to have a fresh photograph registered at the new office.
(d) This facility can be used by illiterate depositors too. In such cases, there will be no need for that witness being known to the post office as he is only to witness and certify the amount actually paid. The address of the witness will however have to be noted on the withdrawal form below his signature.
If the above ruling position is analyzed in the context of the instructions contained in Directorate letter No. 109-04/2007-SB, dated 23.04.2010, the following ambiguities are forthcoming.
1. As it is aware, since most of the transactions are being operated through SAS / MPKBY Agents, presence of the depositors in front of the Postmaster / Counter PA is not mandatory. Thus, now question arises as to how a Postmaster will attest the photograph in the absence of the depositor as directed under Rule – 37 ( 1 ) (a). Can’t attested photographs be ensured ?
2. Rule – 37 ( 1 )( c ) states that the facility will be available only when the depositor personally attends the post office. Thus, does Rule – 37 ( 1 )( c ) mean that attestation of the photograph of the depositor is optional in contravention to Rule – 37 ( 1 ) (a).
3. What will be the position in case signature of the depositor differs and withdrawal has been preferred through messenger in the context of Rule – 37 (1 )( b ) ?
3. What will be the position in case signature of the depositor differs and withdrawal has been preferred through messenger in the context of Rule – 37 (1 )( b ) ?
4. While the CDD / KYC ensures for obtaining 3 copies of recent photographs, identity proof and address proof, the instructions have not been made clear as to if the same documents will be ensured once preferably during the first transaction for the same customer who is repeatedly investing / depositing or all the above documents will be asked for each and every occasion the customer wants to deposit. For example, say a customer having no PAN and interested to invest an amount of Rs.198000/- under MIS requests the Post Office to open 4 MIS Accounts @ Rs.49500/- on 4 occasions spreading over four separate days. In such a situation it may perhaps be embarrassing to ask the same customer to deposit the same documents which are already available in Post Office record during the opening of the first account.
5. Para – 5 in category 3 under CDD/ KYC of Annexure – I of Directorate letter No. 109-04/2007-SB, dated 23.04.2010 directs for verification of address of all customers including in case of opening of account by transfer from other office. It has not been made clear if the verification of the address of a customer residing outside the delivery jurisdiction of the concerned post office to which the account has been transferred will be done by the Divisional administration engaging the PRIs(P) / IPOs/ASPOs. Secondly, if the customers resides within the delivery jurisdiction of the particular post office to which the account has been transferred, weather the remark of the concerned beat postman will be sufficient or further enquiry with remark of the PRIs(P) / IPOs/ASPOs will be required for the purpose.
6. In addition, under the head “Record Keeping” of Annexure – I of Directorate letter No. 109-04/2007-SB, dated 23.04.2010, it has been instructed to keep the account opening form or purchase application form in a guard file duly attested by the Postmaster/SPM/APM. Now as per rules, all the purchase applications / S B-3s except in case of Savings Bank Account are kept in SOs. If the SB - 3s in case of Savings Bank Account is to be kept in the SOs, then Rule-27 ( 2 ) of POSB Manual, Volume – I is required to be amended.
Thus, under such ambiguousness of the Rule – 37 ( 1 ) and other connected rulings of POSB Manual, Volume – I read with the instructions circulated vide Directorate letter No. 109-04/2007-SB, dated 23.04.2010, it is certainly your responsibility as a Postmaster to appraise the Directorate through proper channel to clarify the position in detail so that you , your people and the customers as well are not put into unnecessary troubles.
Would you like to pay a little attention?
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