What changed
The Unlawful Activities (Prevention) Act, 1967 was amended in 2008, and the government issued an Order on August 27, 2009, detailing procedures for freezing, seizing, or attaching funds and financial assets of designated individuals/entities. Banks are now required to strictly follow this Order, including maintaining electronic lists and reporting matches within 24 hours.
What it means for you
Banks must enhance their screening processes to ensure no account is linked to UN-sanctioned individuals or entities. This adds compliance burden but strengthens India's anti-terror financing framework. Non-compliance could lead to regulatory action, so banks need robust systems for real-time list updates and swift reporting.
What you must do
- Update and maintain designated lists in electronic form for regular checks.
- Screen all new and existing accounts against the lists immediately.
- Report any matching accounts to RBI and FIU-IND within 24 hours.
- Ensure compliance with the UAPA Order dated August 27, 2009, for freezing/unfreezing assets.
- Train staff on the new procedures and escalation protocols.
Who it affects
All Scheduled Commercial Banks (excluding RRBs), Financial Institutions, Local Area Banks
What is the deadline for reporting a match with the designated list?
Banks must inform RBI and FIU-IND of full particulars of the funds or assets within 24 hours of finding a match.
Does this apply to existing accounts as well?
Yes, banks must scan all existing accounts to ensure no account is held by or linked to any designated individual or entity.