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FATF Jurisdictions with AML/CFT Deficiencies: NBFC Advisory

Current · Source: Reserve Bank of India · RBI/2010-11/404 · issued 14 Feb 2011 · ~1 min read
Quick answerRBI directs NBFCs/RNBCs to consider FATF's October 2010 statement on jurisdictions with strategic AML/CFT deficiencies and submit acknowledgment to the Regional Office.
The rule, in the simplest words
How it plays out — a real example

A KYC & compliance officer in Indore reviews the FATF statement to identify jurisdictions with strategic AML/CFT deficiencies. She updates the KYC/AML policies to account for risks from those jurisdictions and ensures that all transactions involving customers from those jurisdictions are thoroughly checked for suspicious activity.

What changed

FATF identified certain jurisdictions with strategic AML/CFT deficiencies and issued a statement on October 22, 2010, calling for action plan implementation. RBI now advises all NBFCs/RNBCs to consider the information in that statement.

What it means for you

NBFCs/RNBCs must stay alert to FATF-flagged jurisdictions to avoid inadvertently facilitating money laundering or terrorist financing. This reinforces existing KYC/AML obligations and may require enhanced due diligence for transactions involving those jurisdictions.

What you must do

Who it affects

All Non-Banking Financial Companies (NBFCs), Residuary Non-Banking Companies (RNBCs)

❓ Common questions

What is the FATF statement about?

It lists jurisdictions with strategic deficiencies in anti-money laundering and combating financing of terrorism standards, as of October 22, 2010.

Do we need to take any action beyond acknowledging receipt?

Yes, you must consider the information in the statement and integrate it into your KYC/AML processes, especially for transactions involving those jurisdictions.

Who should submit the acknowledgment?

The compliance officer or principal officer of the NBFC/RNBC must submit it to the concerned Regional Office of DNBS.

📜 Read the original circular — full text as issued by RBI
RBI/2010-11/404 DNBS(PD).CC. No 210/03.10.42/2010-11 February 14, 2011 All Non Banking Financial Companies / Residuary Non Banking Companies Dear Sir, Know Your Customer (KYC) Norms/ Anti- Money Laundering (AML) Standards/ Combating of Financing of Terrorism (CFT) Financial Action Task Force (FATF) as a part of its ongoing review of compliance with the AML / CFT standards, has identified certain jurisdictions which have strategic AML /CFT deficiencies. 2. FATF, has issued a statement dated October 22, 2010 ( copy enclosed ) calling upon jurisdictions listed in the statement to complete the implementation of their action plan within the timeframe. The FATF, in the statement,  has called upon its members to consider the information given in the statement. 3. All NBFCs/RNBCs are accordingly advised to consider the information contained in the enclosed statement. 4. An acknowledged receipt of this circular may be submitted by the Compliance officer/ Principal Officer of the NBFCs to the concerned Regional Office of DNBS in whose jurisdiction the NBFC/RNBC is functioning. Yours faithfully, (Uma Subramaniam) Chief General Manager-in-Charge Encl : as above
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2010-11/404 · issued 14 Feb 2011. The plain-English explanation above is BankPulse’s own independent summary.
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Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (All Non-Banking Financial Companies (NBFCs), Residuary Non-Banking Companies (RNBCs)), your first concrete step on “FATF Jurisdictions with AML/CFT Deficiencies: NBFC Advisory” is: “Review the enclosed FATF statement and identify listed jurisdictions.” (RBI issued this 14 Feb 2011).

  1. Circular: RBI/2010-11/404 -- FATF Jurisdictions with AML/CFT Deficiencies: NBFC Advisory
  2. Issued: 14 Feb 2011
  3. Action required: Review the enclosed FATF statement and identify listed jurisdictions.
  4. Action required: Update your KYC/AML policies to account for risks from those jurisdictions.
  5. Action required: Ensure compliance officer/principal officer acknowledges receipt to the Regional Office of DNBS.
  6. Action required: Monitor transactions involving flagged jurisdictions for suspicious activity.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6263&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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