Module: General Practice
Q68: Consider the following statements regarding Suspicious Transaction Reporting (STR):
Assertion (A): Authorized Persons must file an STR with the Financial Intelligence Unit - India (FIU-IND) within 7 days of arriving at a conclusion that a transaction is suspicious.
Reason (R): The STR must be strictly confidential and the customer must not be tipped off about the report.
Reason (R): The STR must be strictly confidential and the customer must not be tipped off about the report.
✅ Correct Answer: B
1. Assertion (A): True.
Under Rule 7 of the Prevention of Money-laundering (Maintenance of Records) Rules, 2005, the Principal Officer of the AP must furnish the STR to FIU-IND not later than 7 working days on being satisfied that the transaction is suspicious.
2. Reason (R): True.
The "Anti-Tipping Off" rule prohibits the AP from disclosing to the customer (or any third party) that an STR is being filed or that their account is under scrutiny.
This prevents the suspect from destroying evidence or evading authorities.
3. Relationship: Both are independent mandates under PMLA.
R (Confidentiality) is not the reason for A (The 7-day deadline). The deadline is to ensure timely intelligence for Law Enforcement Agencies (LEAs).
Under Rule 7 of the Prevention of Money-laundering (Maintenance of Records) Rules, 2005, the Principal Officer of the AP must furnish the STR to FIU-IND not later than 7 working days on being satisfied that the transaction is suspicious.
2. Reason (R): True.
The "Anti-Tipping Off" rule prohibits the AP from disclosing to the customer (or any third party) that an STR is being filed or that their account is under scrutiny.
This prevents the suspect from destroying evidence or evading authorities.
3. Relationship: Both are independent mandates under PMLA.
R (Confidentiality) is not the reason for A (The 7-day deadline). The deadline is to ensure timely intelligence for Law Enforcement Agencies (LEAs).