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  1. PML rules: BSE seeks update on clients’ Aadhaar numbers

PML rules: BSE seeks update on clients’ Aadhaar numbers

To ensure compliance with anti-money laundering rules, BSE today asked its brokers to submit details about preparedness for furnishing Aadhaar details of their clients by month-end.

By: | Published: October 26, 2017 2:04 PM
Anti-money laundering rules, BSE, Aadhaar details, Aadhaar, Brokers To ensure compliance with anti-money laundering rules, BSE today asked its brokers to submit details about preparedness for furnishing Aadhaar details of their clients by month-end. (Image: IE)

To ensure compliance with anti-money laundering rules, BSE today asked its brokers to submit details about preparedness for furnishing Aadhaar details of their clients by month-end.  This follows the government’s amending in June the Prevention of Money Laundering (Maintenance of Records) Rules with regard to collection of Aadhaar number from clients. In a circular, BSE has asked its stock brokers to submit a report with details about their preparedness, number of active clients and the number of clients who have complied with submitting Aadhar numbers.  “Members are requested to submit/update the details by October 31, 2017,” BSE (formerly known as Bombay Stock Exchange) said.

“The number of clients complied to be mentioned should be the cumulative number of clients who have complied with submitting Aadhaar numbers,” it added.  In the case of companies, a manager, officer or employees holding “attorneys to transact” on a company’s behalf have to submit their Aadhaar details.  With regard to partnership firm, trust and unincorporated association or body of individuals, the person holding attorney to transact on the entity’s behalf has to provide Aadhaar details to the exchange.  Also, BSE said that it is required to report to the markets regulator Sebi on the preparedness of the trading members with respect to compliance with the amended rules.

In compliance with the amended PML norms, banks have already sought Aadhaar details from their customers.
Last month, Sebi had asked stock exchanges to submit a monthly progress report on collection of Aadhaar numbers by its members.  “…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,” BSE had said.

As per the amended PML rules, where the client has not submitted Aadhaar number at the time of commencement of an 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.

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  1. R
    Reader
    Nov 7, 2017 at 7:24 pm
    The biometrics-based Aadhaar program is inherently flawed. Biometrics can be easily lifted by external means, there is no need to hack the system. High-resolution cameras can capture your fingerprints and iris information from a distance. Every eye hospital will have iris images of its patients. So another person can CLONE your fingerprints and iris images without your knowledge, and the same can be used for authentication. That is why advanced countries like the US, UK, etc. did not implement such a self-destructive biometrics-based system. If the biometric details of a person are COMPROMISED ONCE, then even a new Aadhaar card will not help the person concerned. This is NOT like blocking an ATM card and taking a new one.
    Reply
    1. R
      Reader
      Nov 7, 2017 at 7:23 pm
      UK’s Biometric ID Database was dismantled. Why the United Kingdom's biometrics-linked National Identi-ty Card project to create a centralized register of sensitive information about residents similar to Aadhaar was scrapped in 2010?? The reasons were the massive threat posed to the privacy of people, the possibility of a surveillance state, the dangers of maintaining such a huge centralized repository of personal information and the purposes it could be used for, the dangers of such a centralized database being hacked, and the unreliability of such large-scale biometric verification processes. The Aadhaar program was designed in 2009 by mainly considering the 'Identi-ty Cards Act 2006' of UK, but the UK stopped that project in 2010, whereas India continued with the biometrics-based program. We must think why the United Kingdom abandoned their project and destroyed the data collected. (Google: 'Identi-ty Cards Act 2006' and 'Identi-ty Documents Act 2010' )
      Reply
      1. R
        Reader
        Oct 26, 2017 at 2:59 pm
        The Supreme Court is yet to take a decision on the validity of Aadhaar and whether the State can compulsorily link Aadhaar to various programs and all financial transactions. The Supreme Court is set to hear peti-tions related to Aadhaar including those for scrapping the Aadhaar Act, stopping biometric profiling, halting bank and mobile databases seeding with Aadhaar, etc. in November 2017.
        Reply
        1. R
          Reader
          Oct 26, 2017 at 2:58 pm
          A centralized and inter-linked biometric database like Aadhaar will lead to profiling and self-censorship, endangering freedom. Personal data gathered under the Aadhaar program is prone to misuse and surveillance. Aadhaar project has created a vulnerability to identi-ty fraud, even identi-ty theft. Easy harvesting of biometrics traits and publicly-available Aadhaar numbers increase the risk of impersonation, especially online and banking fraud. Centralized databases can be hacked. Biometrics can be cloned, copied and reused. Thus, BIOMETRICS CAN BE FAKED. High-resolution cameras can capture your fingerprints and iris information from a distance. Every eye hospital will have iris images of its patients. So another person can clone your fingerprints and iris images without your knowledge, and the same can be used for authentication. If the Aadhaar scheme is NOT STOPPED by the Supreme Court, the biometric features of Indians will soon be cloned, misused, and even traded.
          Reply
          1. R
            Reader
            Oct 26, 2017 at 2:58 pm
            UK’s Biometric ID Database was dismantled. Why the United Kingdom's biometrics-linked National Identi-ty Card project to create a centralized register of sensitive information about residents similar to Aadhaar was scrapped in 2010?? The reasons were the massive threat posed to the privacy of people, the possibility of a surveillance state, the dangers of maintaining such a huge centralized repository of personal information, and the purposes it could be used for, and the dangers of such a centralized database being hacked. The other reasons were the unreliability of such a large-scale biometric verification processes, and the ethics of using biometric identification. (Google: Identi-ty Cards Act 2006 and Identi-ty Documents Act 2010 )
            Reply
            1. R
              Reader
              Oct 26, 2017 at 2:57 pm
              The US Social Security Number (SSN) card has NO BIOMETRIC DETAILS, no photograph, no physical description and no birth date. All it does is confirm that a particular number has been issued to a particular name. Instead, a driving license or state ID card is used as an identification for adults. The US government DOES NOT collect the biometric details of its own citizens for the purpose of issuing Social Security Number. The US collects the fingerprints of only those citizens who are involved in any criminal activity (it has nothing to do with SSN), and the citizens of other countries who come to the US.
              Reply
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