What changed
RBI issued a circular on September 12, 2011, updating the previous August 2, 2011 circular on the UNSCR 1267/1822 terrorist list. The UN Security Council's 1267 Committee provided notes dated June 23, 2011 and July 19, 2011 with changes to the consolidated list of individuals and entities linked to Al-Qaida and Taliban. NBFCs and RNBCs are now required to incorporate these latest changes into their screening processes.
What it means for you
NBFCs and RNBCs must immediately update their internal databases with the revised UN consolidated list. This ensures compliance with anti-money laundering and counter-terrorism financing norms. Failure to screen new and existing accounts against this list could expose firms to regulatory action and reputational risk.
What you must do
- Update your internal customer database with the latest UN consolidated list of individuals/entities linked to Al-Qaida and Taliban from the UN website.
- Before opening any new account, verify that the proposed customer's name does not appear in the updated list.
- Scan all existing accounts to identify and flag any account held by or linked to entities or individuals on the list.
- Maintain records of screening checks and any actions taken for audit and regulatory review.
Who it affects
All Non-Banking Financial Companies (NBFCs), All Residuary Non-Banking Companies (RNBCs)
What is the source of the list I need to use?
The consolidated list is maintained by the UN Security Council's 1267 Committee and is available at http://www.un.org/sc/committees/1267/consolist.shtml.
Do I need to check only new accounts or also existing ones?
Both. You must ensure no new account is opened for a listed individual/entity, and you must scan all existing accounts to identify any that are held by or linked to listed parties.
What should I do if I find a match in an existing account?
The circular does not specify actions, but standard practice is to freeze the account, report to the Financial Intelligence Unit (FIU) and RBI, and follow applicable anti-money laundering guidelines.