SymetraSM and the Symetra Financial logo are service marks of Symetra Life Insurance Company, not a

1
Anti-Money Laundering ProgramAgent Training

• Presented by
• First Symetra National Life Insurance
• Company of New York
• New York, NY

2
Course Overview

• This course will help raise your awareness of
  anti-money laundering (AML) rules so that you can
  help prevent and detect possible illegal
  activities. Topics covered include

• Definitions of money laundering, terrorist
  financing, and covered products.
• Overview of federal regulations.
• Integration and training of agents.
• Suspicious activities and reporting requirements.
• Office of Foreign Asset Control (OFAC).
• Penalties.

3
What is Money Laundering?

• Money laundering is a process by which illegal
  income generated through criminal activity is
  disguised by first placing it with an
  unsuspecting financial institution or business.
• Next the money is moved through layers of
  financial transactions until the original source
  of the money becomes obscured or impossible to
  ascertain.
• Finally, the money is integrated into
  legitimate transactions or businesses.
• The goal is to make a confusing audit trail so it
  becomes difficult to detect where the funds came
  from.

4
Examples of Money Laundering
The following examples of money laundering
illustrate how check(s) issued by an insurance
company would launder illegal funds, giving the
recipient clean money

• An insurance policy or annuity contract was
  purchased with illegal funds and was immediately
  returned for a refund under the free look or
  right to return contract provision.
• An annuity contract was purchased by a money
  launderer in exchange for an immediate or
  deferred stream of payments.

5
What is Terrorist Financing?

• 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.

6
Federal Regulations

• The USA PATRIOT Act resulted from the Sept. 11,
  2001 terrorist attacks.
• The Act strengthened AML laws, enhanced civil and
  criminal penalties for violations, and granted
  new law enforcement and surveillance
  capabilities.
• AML laws are primarily enforced by the Financial
  Crimes Enforcement Network (FinCEN), a bureau in
  the U.S. Department of the Treasury.

7
Federal Regulations (continued)

• Insurance companies are required to have an AML
  program for their covered products. Programs
  must include the following elements

• Policies, procedures, and internal controls
  designed to prevent the company from being used
  to facilitate money laundering or terrorist
  financing.
• A compliance officer to administer the program.
• Ongoing training for appropriate persons.
• An independent audit function to test the program.

8
What are Covered Products?

• The regulations do not apply to all insurance
  products, but only apply to these covered
  products

• Permanent life insurance policies, other than
  group life insurance policies
• Annuity contracts, other than group annuity
  contracts and
• Any other insurance products with features of
  cash value or investment.

9
Integration of Agents

• Insurance companies are required to integrate
  their agents into their AML program. This
  includes ensuring that agents receive training
  and that agents gather information necessary to
  help prevent and detect money laundering.

10
Training Requirement

• Agents licensed to sell one or more of the
  covered products must be trained concerning
  their responsibilities under the AML program.
• It is the responsibility of the agency to ensure
  that all of its producers have completed an
  authorized AML training course when licensed and
  annual refresher courses thereafter. Upon
  request, agencies must provide proof that
  training has been completed.

11
Suspicious Activities

• In order to detect money laundering, we need to
  watch for indicators of suspicious customer
  behavior (red flags). Possible indicators are

• Purchase of an insurance product inconsistent
  with the customers needs.
• Unusual payment methods.
• Early termination of a product, especially at a
  cost to the customer, or where payment is made
  by, or the refund check is directed to, an
  apparently unrelated third party.

12
Suspicious Activities (continued)

• The transfer of the benefit of a product to an
  apparently unrelated third party.
• A customer who shows little concern for the
  performance of a product or its risks or charges,
  but much concern about early termination features
  of the product.
• A customer who is reluctant to provide
  identifying information when purchasing a
  product, or who provides minimal or seemingly
  fictitious information.

13
Suspicious Activities (continued)

• A customer who borrows the maximum amount
  available soon after purchasing the product.
• Unusual concern for secrecy or concern about
  reporting requirements.
• Documents that appear to be false or have been
  altered.
• Purchases or transactions that dont make
  economic sense.
• A policy or contract with a mailing address
  outside the United States or Canada.

14
Suspicious Activities (continued)

• Trying to establish multiple policies or
  contracts with no reasonable explanation.
• Purchasing a policy or contract in someone elses
  name without reasonable explanation.
• Unclear source of funds.
• Paying cash or money orders for a large amount of
  10,000 or more.
• A series of cash payments of just under 5,000
  (cash transactions of 10,000 or more must be
  reported).

15
Suspicious Activities (continued)

• Premiums that seem to exceed the customers
  resources.
• Requests to convert cash to checks or other
  non-cash instruments.
• Sudden and unexplained requests for wire
  transfers or wire transfer requests that dont
  clearly identify the originator or recipient.

16
Reporting Suspicious Activities

• Agents and insurance company employees are often
  in the best position to detect suspicious
  activity.
• Agents must notify the insurance company if they
  notice any red flags or other suspicious
  activities by sending an e-mail to AML Compliance
  (AMLCOM_at_symetra.com).
• The insurance company will determine if the
  activity must be reported to the authorities and
  will submit any required reports.

17
Suspicious Activity Reports (SARs)

• Suspicious Activity Reports (SARs), and the fact
  that theyve been filed, must be kept
  confidential.
• Customers cannot be notified that a suspicious
  activity has been reported.
• Insurance companies and their agents and
  employees are protected from liability to
  customers for disclosing possible criminal
  activity to law enforcement and certain
  government supervisory agencies.

18
Office of Foreign Asset Control (OFAC)

• The OFAC section of the U.S. Department of the
  Treasury administers and enforces economic
  sanctions based on U.S. foreign policy and
  national security goals against targeted foreign
  countries, terrorists, international narcotics
  traffickers, and those engaged in activities
  related to the proliferation of weapons of mass
  destruction.
• OFAC imposes controls on certain transactions and
  may freeze or block foreign assets under U.S.
  jurisdiction.

19
OFAC (continued)

• OFAC prohibits U.S. businesses from doing
  business in any way with targeted entities.

• If a U.S. business is doing business with a
  targeted entity, the asset must be blocked and
  reported to OFAC.

• OFAC has a Web site that shows entities and
  individuals who have been identified as known or
  suspected terrorists, specially designated
  nationals (SDNs), or blocked persons.
• Insurance companies have procedures for checking
  customers against the list and submitting
  required reports if there is a match.

20
Penalties

• The criminal statutes impose fines of up to 1
  million and imprisonment for up to 10 years for
  money laundering.
• Individuals whom the court finds to be willfully
  blind to money laundering activities may also be
  liable.

21
Conclusion

• Insurance companies are required to have an AML
  program to help prevent and detect money
  laundering and are required to integrate their
  agents in the program.
• The regulations apply to individual permanent
  life insurance policies, individual annuity
  contracts, and any other insurance products with
  cash values.
• Agents must be alert to suspicious activities and
  report suspicious activities to the insurance
  company.

22
Questions?

• For questions about the rules, assistance in
  developing policies and procedures to implement
  training requirements, or to report suspicious
  activities, please contact

• AML Compliance (AMLCOM_at_symetra.com)

23
Certificate of Completion

• Congratulations! You have completed the course.

• Print a copy of the following slide.
• Fill in the date you completed this course and
  your name.
• Keep the certificate with your personal
  continuing education records.

24

• CERTIFICATE OF COMPLETION
• Date Completed (please print) ________
• Name (please print) ________
• has completed a web-based self-study program on
• Anti-Money Laundering - Agent Training
• sponsored by
• First Symetra National Life Insurance Company of
  New York
• New York, NY
• Course Content
• This course addressed anti-money laundering
  rules to provide awareness to help prevent and
  detect

25
First Symetra National Life InsuranceCompany of
New YorkNew York, NYThank You