Primarily, a financing entity is described or rather classified as an underwriter, a lender, a placement agent, a purchaser of a certificate or a policy from a settlement provider, a purchaser of securities credit enhancer, or any entity which has a direct ownership in a certain policy or certificate which is the subject of settlement contract.
Thus, a financing entity is one whose main activity is somehow related with the transaction in providing funds in order to effect the purchase or settlement of one or more policy; and has an arrangement in writing with one or more licensed settlement suppliers in financing the acquisition of settlement contracts.
Other informations regarding financial entities shall include banks, such as those programmed in the schedule 1 or 2 under the Bank Law, allowed foreign banks in respect to the company procedures in Canada, financial services organizations, credit unions, credit union central whenever they provide for financial services towards anybody other an entity member of the central credit union, loan companies, trust companies, and crown agents that accepts deposit liability.
Obligations of a financial entity are necessary in order that such responsibilities should be maintained, and the working conditions between the entity and its clients are realized. The said obligations to be followed are as follows:
1. To report suspicious transactions and activities, whenever there are several reasons as basis to believe and think that a certain transaction or attempted transaction has been related to an attempted commission of money laundering offense and/or some terrorist movement financing offense.
2. To report a property being possessed or is under the control of a terrorist individual or terrorist group.
3. To report cash transactions in large volume involving the amounts up to $10,000 and much more that will be received through cash.
4. To report electronic transferring of funds in the international level in the amount of $10,000 or more than what is being received or sent. These may include transmissions of instruction for a certain transferring of funds being made at the call of one client by means of an electronic, optical or magnetic device, computer, or telephone instrument.
5. In cases of “swift messages”, only the “swift MT 103” messages will be included for report.
6. To keep records, such as, signature cards, records on large cash transaction, deposit slips, account statements, copies of the suspicious transaction reports, client credit files, beneficial ownership records, and intended use of an account.
7. To take precise measures in identifying entities or individuals, such as, an individual who conducts foreign exchange activity in the amount of $3,000 or more, except if there is card signed by the client’s own signature exist.
8. To take reasonable ways in determining if the company is selling to a foreign person which is politically exposed for an existing or new account or rather a particular transfers of funds electronically of an amount $100,000 and much more.