RBI Tightens AML/CFT Checks on Iran, DPRK, and 8 Other Nations
Current · Source: Reserve Bank of India · RBI/2011-12/186 · issued 19 Sep 2011 · ~1 min read
Quick answerRBI directs Indian agents under MTSS to apply FATF counter-measures against Iran and DPRK for ML/FT risks, and to consider risks from Bolivia, Cuba, Ethiopia, Kenya, Myanmar, Sri Lanka, Syria, and Turkey due to strategic AML/CFT deficiencies.
The rule, in the simplest words
Indian agents must apply FATF counter-measures against Iran and DPRK for ML/FT risks, and consider risks from Bolivia, Cuba, Ethiopia, Kenya, Myanmar, Sri Lanka, Syria, and Turkey due to strategic AML/CFT deficiencies.
Indian agents must treat Iran and DPRK as high-risk for money laundering and terrorist financing, applying enhanced due diligence or transaction restrictions.
Indian agents must consider risks from the eight listed jurisdictions when entering business relationships and transactions, potentially increasing compliance costs and slowing cross-border remittances.
How it plays out — a real example
Ramesh, a KYC & compliance officer in Indore, must apply enhanced due diligence when lending to a customer from Iran, as per RBI's updated AML/CFT guidelines. He must verify the customer's identity, check for any suspicious transactions, and report any unusual activity to the RBI. This ensures that Ramesh's bank is not used for money laundering or terrorist financing.
What changed
RBI updated its earlier May 2011 circular with FATF's June 2011 statement, advising counter-measures against Iran and DPRK. It also added eight jurisdictions with strategic AML/CFT deficiencies that require risk consideration before business relationships.
What it means for you
Indian agents must now treat Iran and DPRK as high-risk for money laundering and terrorist financing, applying enhanced due diligence or transaction restrictions. For the eight listed countries, a risk-based approach is needed, potentially increasing compliance costs and slowing cross-border remittances.
What you must do
Update AML/CFT policies to include FATF counter-measures for Iran and DPRK.
Consider risks from the eight listed jurisdictions when entering business relationships and transactions.
Train staff on identifying and reporting suspicious transactions linked to these countries.
Advise Principal Officer to acknowledge receipt of this circular to RBI.
Who it affects
Indian agents under Money Transfer Service Scheme, Authorised Persons handling cross-border inward remittances, Compliance and AML/CFT teams at banks and financial institutions
Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).
Does this circular ban all transactions with Iran?
No, it does not prohibit legitimate trade and business transactions with Iran, but requires application of FATF counter-measures to protect the financial system from ML/FT risks.
What are the eight new jurisdictions added?
Bolivia, Cuba, Ethiopia, Kenya, Myanmar, Sri Lanka, Syria, and Turkey are identified as having strategic AML/CFT deficiencies, requiring risk assessment before business relationships.
What legal backing does this circular have?
It is issued under FEMA 1999 (Sections 10(4) and 11(1)) and PMLA 2002, with non-compliance attracting penal provisions under those Acts and Rules.
📜 Read the original circular — full text as issued by RBI
RBI/2011-12/186
A.P. (DIR Series) Circular No. 22
September 19, 2011
To,
All Authorised Persons, who are Indian Agents under Money Transfer Service Scheme.
Madam/ Sir,
Anti-Money Laundering (AML) standards/Combating the Financing of
Terrorism (CFT) Standards - Cross Border Inward Remittance under
Money Transfer Service Scheme
Attention of all the Authorised Persons, who are Indian Agents under Money Transfer Service Scheme (MTSS) is invited to A.P.(DIR Series) Circular No.64 dated May 20, 2011 on risks arising from the deficiencies in AML/CFT regime of Iran and Democratic People’s Republic of Korea (DPRK).
2. Financial Action Task Force (FATF) has issued a further Statement on June 24, 2011 on the subject ( copy enclosed ) calling its members and other jurisdictions to apply counter-measures to protect the international financial system from the ongoing and substantial money laundering and terrorist financing (ML/FT) risks emanating from Iran and Democratic People’s Republic of Korea (DPRK).
3. This advisory does not preclude Authorised Persons (Indian Agents) entering into legitimate trade and business transactions with Iran.
4. FATF has also identified Jurisdiction with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies. The FATF calls on its members to consider the risks arising from the deficiencies associated with each jurisdiction as described in the Statement : Bolivia, Cuba, Ethiopia, Kenya, Myanmar, Sri Lanka, Syria and Turkey.
5. Authorised Persons (Indian Agents) are accordingly advised to take into account risks arising from the deficiencies in AML/CFT regime of these countries, while entering into business relationships and transactions with persons (including legal persons and other financial institutions) from or in these countries/ jurisdictions.
6. Authorised Persons (Indian Agents) may bring the contents of this circular to the notice of their constituents concerned.
7.Please advise your Principal Officer to acknowledge receipt of this circular letter.
8. The directions contained in this Circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and also under the Prevention of Money Laundering Act (PMLA), 2002, as amended by Prevention of Money Laundering (Amendment) Act, 2009 and Prevention of Money-Laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Rules, 2005 as amended from time to time. Non-compliance with the guidelines would attract penal provisions of the Acts concerned or Rules made there under.
Yours faithfully,
(Meena Hemchandra)
Chief General Manager-in-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2011-12/186 · issued 19 Sep 2011. The plain-English explanation above is BankPulse’s own independent summary.
Update AML/CFT policies to include FATF counter-measures for Iran and DPRK.
📜 Compliance
Consider risks from the eight listed jurisdictions when entering business relationships and transactions.
Train staff on identifying and reporting suspicious transactions linked to these countries.
Advise Principal Officer to acknowledge receipt of this circular to RBI.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Branch Manager at a bank this circular applies to (Indian agents under Money Transfer Service Scheme, Authorised Persons handling cross-border inward remittances, Compliance and AML/CFT teams at banks and financial institutions), your first concrete step on “RBI Tightens AML/CFT Checks on Iran, DPRK, and 8 Other Nations” is: “Update AML/CFT policies to include FATF counter-measures for Iran and DPRK.” (RBI issued this 19 Sep 2011).
Circular: RBI/2011-12/186 -- RBI Tightens AML/CFT Checks on Iran, DPRK, and 8 Other Nations
Issued: 19 Sep 2011
Action required: Update AML/CFT policies to include FATF counter-measures for Iran and DPRK.
Action required: Consider risks from the eight listed jurisdictions when entering business relationships and transactions.
Action required: Train staff on identifying and reporting suspicious transactions linked to these countries.
Action required: Advise Principal Officer to acknowledge receipt of this circular to RBI.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
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.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6718&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.
Help us keep this accurate
Found an inaccuracy or have an improvement? Tell us. Every report is reviewed by our team before any change is made — nothing goes live unverified.
Public beta — plain-English informational summaries. Always verify against the official RBI source (circular number cited on every page) before making compliance, credit, treasury, audit, or operational decisions. · Join our WhatsApp channel ↗
BANKPULSE · FREE DAILY BRIEF
Get RBI updates for your role
Every important RBI update, decoded in plain English — for your career, exams & financial awareness.
We collect only your email, name and role, used solely to send your brief — never sold or shared. Withdraw anytime via the unsubscribe link in any email. Independent platform, not affiliated with the RBI. Information, not legal advice.
REPORT AN ERROR · BETA
Spotted an error? Earn 500 BankPulse Credits
Help us stay accurate. If your correction is verified true and approved by our founder, you earn 500 BankPulse Credits — redeemable when the platform monetises.
Reviewed by a human before any credit is awarded. We never change the site from crowd input without verification.
WANT A NEW FEATURE · BETA
What would make BankPulse more useful for you?
Tell us what to build next — a tool, a data view, a role page, anything. We read every suggestion.
Thank you — your ideas directly shape what we build.