What changed
FATF issued a new statement on June 24, 2011, updating its list of jurisdictions with strategic AML/CFT deficiencies and calling for action plan implementation within set timeframes. RBI now requires banks and AIFIs to consider this updated FATF statement in their AML/CFT processes.
What it means for you
Banks must update their AML/CFT risk frameworks to incorporate the latest FATF-identified jurisdictions. This may affect customer due diligence, transaction monitoring, and reporting for entities linked to those jurisdictions. Non-compliance could expose banks to regulatory scrutiny and reputational risk.
What you must do
- Review the enclosed FATF statement and update your institution's list of high-risk jurisdictions accordingly.
- Ensure your AML/CFT policies and procedures reflect the new FATF guidance for enhanced due diligence.
- Advise your Principal Officer to acknowledge receipt of this circular to RBI.
- Train relevant staff on the updated FATF requirements and jurisdiction-specific risks.
Who it affects
All Scheduled Commercial Banks (excluding RRBs), Local Area Banks, All India Financial Institutions
What is the FATF statement about?
The FATF statement identifies jurisdictions with strategic AML/CFT deficiencies and calls on them to complete action plans within a timeframe. It also asks members to consider this information.
Do we need to report anything to RBI?
Yes, your bank's Principal Officer must acknowledge receipt of this circular letter to RBI as per paragraph 4 of the circular.
What if we already have AML/CFT procedures?
You must still review and update your procedures to incorporate the latest FATF statement, as it may include new or changed jurisdictions.