1. Presented by: Hany Faidy Senior Vice President, Head of Compliance Division March 2009 Procedures followed by FI’s when reporting Suspicious Transaction

2. Risks of Money Laundering & Terrorist Financing What KYC Means? Detection of Suspicious Activity Analysis & Investigation SAR (NCB Sample) Content 1

3. Risks of Money Laundering & Terrorist Financing Money Laundering or Terrorist Financing operations could expose Banks to face potential risks that could occur including the following: Reputation risk – customer loss of confidence in being involved with an entity apparent to be assisting criminals or terrorists. This loss of confidence could lead to a loss of business and revenue. Regulatory risk –This could result in possible fines or regulatory sanctions. Personal risk – employees who facilitate money-laundering or terrorist activities, or fail to take appropriate steps to prevent these activities, could face personal criminal action, civil action or dismissal. lawful

4. What KYC Means? KYC is certainly considered one of the top key elements of the AML Compliance Program: Know? What you should know? True identity and personal information, address, financial information and beneficial ownership of the accounts Your? Who should know? Branch employee, Relationship manager, all Bank employees. Customer? One who maintains an account, establishes business relationship, on who’s behalf account is maintained, and one who carries potential risk through one off transaction. -- It is important to have the customer regularly updating his/her information --

5. Risk Ranking Customer & Transaction Profile Customer information Transactions Information Products Channels Legal Entity, Nationality,Occupation,Income Cash Deposit Transfer Utility Bills Branch, ATM, Tele-Banking, Internet Banking Remittance Credit Card Trade Services Monitoring Customer Activities High Risk Individuals PEP’s PBK Charities Corr. Banks Local International POS Internet FX/MM/SAWPS Treasury LC/LG

6. Suspicious transaction means a transaction that the Bank suspects or have a reasonable ground of suspicion that: –It may involve the proceeds of crime or –Appears to have no economic purpose. Beside having online monitoring system, bank employees are obliged to report any suspicious activity to the Anti-Money Laundering Department Detecting Suspicious Activity All Transactions Unusual Transactions Suspicious Transactions

7. Analysis & Investigation Anti-Money Laundering Department should ensure conducting proper analysis and investigations to cases reported from branches and other business units within the Bank, and as a result, SAR must include customer personal information, financial, employment, address, transactions movement, depositors, beneficiaries, reasons of suspicious, etc… Anti-Money Laundering Department must file a SAR of any real/suspicious case to the Financial Intelligence Unit.

8. SAR- Page1 (Suspect Information) This page contains: Personal Information Financial Information Employment Information Account Information Summary of Transactions Product Used Channels Used Geographical and frequency of Transactions

9. SAR- Page2 (Account Movement Summary) This page of SAR includes summary of transactions movement of the suspected customer by each transaction type.

10. SAR- Page3 (Suspicious Reasons) This page of SAR includes Reasons of Suspicion, more information can be added as appropriate.

11. Thank you for your time & attention