Exhibit (h)(6)
SECTION 312 FOREIGN FINANCIAL INSTITUTION AMENDMENT
This SECTION 312 "FOREIGN FINANCIAL INSTITUTION' SPECIAL DUE DILIGENCE
ANTI-MONEY LAUNDERING AMENDMENT (this "AMENDMENT") amends as of July 5, 2006
(the "EFFECTIVE DATE"), the Transfer Agent Service Agreement, dated as of June
10, 2006, between THE ALLEGIANT ADVANTAGE FUNDS, a Massachusetts business trust,
and ALLEGIANT FUNDS (the "COMPANY" or the "FUND") and PFPC Inc. ("PFPC") (the
"AGREEMENT").
For valuable consideration the receipt and sufficiency of which the
parties hereto hereby acknowledge, the Company and PFPC hereby agree that, as of
the Effective Date, the Agreement shall (without any further action by either of
the parities hereto) be amended as follows:
1. SECTION 312 "FOREIGN FINANCIAL INSTITUTION" SPECIAL DUE DILIGENCE. As of the
Effective Date, the Agreement is amended by adding the following new provision:
SECTION 312 FOREIGN FINANCIAL INSTITUTION SPECIAL DUE DILIGENCE. (a) To
help the Fund comply with its requirements to establish and implement a
due diligence program for "foreign financial institution" accounts
(which the Fund is required to have under regulations issued under
Section 312 of the USA PATRIOT Act), PFPC will do the following ("Due
Diligence Services":
(i) Implement and operate a due diligence program that includes
appropriate, specific, risk-based policies, procedures and
controls that are reasonably designed to enable the Fund to
detect and report, on an ongoing basis, any known or suspected
money laundering activity conducted through or involving any
correspondent account established, maintained, administered or
managed by the Fund for a "foreign financial institution" (as
defined in 31 CFR 103.175(h))("Foreign Financial Institution");
(ii) Conduct due diligence to identify and detect any Foreign
Financial Institution accounts in connection with new accounts
and account maintenance except PFPC will not conduct Due
Diligence Services on NSCC accounts or broker-dealer controlled
accounts;
(iii) Assess the money laundering risk presented by such Foreign
Financial Institution account, based on a consideration of all
appropriate relevant factors, (as generally outlined in 31 CFR
103.176), and assign a risk category to each Foreign Financial
Institution account;
(iv) Apply risk-based procedures and controls to each such
Foreign Financial Institution account reasonably designed to
detect and report known or suspected money laundering activity,
including a periodic review of the Foreign Financial Institution
account activity sufficient to determine consistency with
information obtained about the type, purpose and anticipated
activity of the account;
(v) Include procedures to be followed in circumstances in which
the appropriate due diligence cannot be performed with respect to
a Foreign Financial Institution account;
(vi) Adopt and operate enhanced due diligence policies, where
necessary, as may be required by future regulations pending for
Foreign Financial Institution accounts;
(vii) Record due diligence program and maintain due diligence
records relating to Foreign Financial Institution accounts;
(viii) Report to the Fund about measures taken under (i)-(vii)
above; and
(ix) Set forth on a separate fee schedule compensation amounts
due for these Foreign Financial Institution services.
(b) Notwithstanding anything to the contrary, and without expanding the
scope of the express language above, PFPC need not complete a due
diligence beyond the requirements of the relevant regulations and PFPC
need not perform any task that need not be performed for the Fund to be
in compliance with relevant regulation.
(c) Without limiting or expanding the foregoing, the parties agree the
provisions herein do not apply to Section 326 of the USA PATRIOT Act
(or other sections other than Section 312) or regulations promulgated
thereunder. This amendment specifically excludes private bank account
provisions of Section 312 of the USA PATRIOT Act.
2. GENERAL. This Amendment contains the entire understanding between the parties
with respect to the services contemplated hereby. Except as expressly set forth
herein, the Agreement shall remain unaffected hereby.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers, as of the day and year first above
written.
THE ALLEGIANT ADVANTAGE FUNDS and ALLEGIANT FUNDS
By: /s/ Xxxxxxxx X. Xxxx
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Name: Xxxxxxxx X. Xxxx
Title: Chief Compliance Officer
PFPC INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President and Director
Transfer Agent Division
