BSE asks clearing members for details on PML rules compliance

Leading exchange BSE today asked clearing members and custodians to report about their preparedness to comply with the amended prevention of money laundering (PML) rules whereby clients are required to furnish their Aadhaar details.
In June, the government had amended the Prevention of Money Laundering (Maintenance of Records) Rules.
All the clearing members and custodians "are required to report on their preparedness" and highlight issues, if any, with regard to compliance with the amended PML rules, on or before August 25, BSE said in a notice.
"... The Prevention of Money Laundering (Maintenance of Records) Rules, 2005 has been amended as per the gazette notification dated June 1, 2017, inter alia, to provide for submission of Aadhaar number, where the client enters into an account based relationship with reporting entity," the notice said.

Clearing Members are members of the clearing houses or clearing corporations who facilitate settlement of trades done on stock exchanges. Custodians are clearing members and settle trades on behalf of their clients.
The exchange has also provided a format in which the entities have to report.

As per the amended PML rules, where the client has not submitted Aadhaar number at the time of commencement of account-based relationship with the reporting entity, then the same should be furnished within six months. The period would be calculated from the date of starting the account-based relationship.
For clients having an account-based relationship with reporting entities prior to June 1, Aadhaar details have to be submitted by December 31, 2017.

In case of failure to submit the documents within the prescribed time limit, the account would be suspended till the Aadhaar details are submitted by the client.