SHCIL Services Ltd. (SSL) being an intermediary registered with Securities & Exchange
Board of India as a Stock Broker is also governed by the provisions of Prevention
of Money Laundering Act, 2002. In order to comply with the provisions of the PMLA,
SSL has undertaken a program of Anti Money Laundering.
We take this opportunity to create awareness to our clients regarding the objectives
of Anti Money Laundering program undertaken by the company.
The Prevention of Money Laundering Act, 2002 came into effect from 1st July 2005.
Money laundering is generally defined as engaging in acts designed to conceal or
disguise the true origins of criminally derived proceeds so that the unlawful proceeds
appear to have derived from legitimate origins or constitute legitimate assets.
Generally, money laundering occurs in three stages. Cash first enters the financial
system at the "placement" stage, where the cash generated from criminal activities
is converted into monetary instrument, such as money orders or deposited into accounts
at financial institutions. At the "layering" stage, the funds are transferred or
moved into other accounts or other financial institutions to further separate the
money from its criminal origin. At the "integration" stage, the funds are reintroduced
into the economy and used to purchase legitimate assets or to fund other criminal
activities or legitimate businesses.
Terrorist financing may not involve the proceeds of criminal conduct, but rather
an attempt to conceal the origin or intended use of the funds, which will later
be used for criminal purposes.
As per the provisions of the Act, besides other entities as defined therein, every
intermediary (which includes a stock-broker & sub-broker and any other intermediary
associated with securities market and registered under section 12 of the Securities
and Exchange Board of India Act, 1992) shall have to maintain a record of all the
transactions; the nature and value of which has been prescribed in the Rules under
the PMLA. Such transactions include:
1. All cash transactions of the value of more than Rs.10 lacs or its equivalent in
2. All series of cash transactions integrally connected to each other which have been
valued below Rs.10 lacs or its equivalent in foreign currency where such series
of transactions take place within one calendar month.
3. All suspicious transactions whether or not made in cash and including, inter-alia,
credits or debits into from any non monetary account such as demat account, security
account maintained by the Company.
In order to fulfill the aforesaid requirements, SHCIL Services Ltd., being a Stock
Broker, has put in place a system for identifying, monitoring and reporting suspected
money laundering or terrorist financing transactions to the law enforcement authorities.
Further, as per the policy adopted in view of the PMLA guidelines, SSL-
1. Does not accept/pay cash from/to clients.
2. Does not accept pay orders and demand drafts from clients.
3. Does not accept payment from any bank account that is not designated in Client Registration
form as a Know Your Client (KYC) requirement by client.
4. Does not accept payment from an entity other than the client.
5. Makes payment only to the client and does not make payment to any third party on
behalf of client or otherwise.
6. May call for additional information or details or documents to satisfy the KYC requirement from
time to time.
SSL may send Suspicious Transaction Report to the appropriate law enforcement authorities