What changed
The UN Security Council split its consolidated sanctions list into two: the Al-Qaida Sanctions List (maintained by the 1267/1989 Committee) and the 1988 Sanctions List (for Taliban-associated individuals/entities). RBI now requires urban co-operative banks to reference both lists separately when implementing Section 51A of UAPA, 1967.
What it means for you
Urban co-operative banks must update their internal screening databases to include both new UN lists. Before opening any account, banks must verify the proposed customer's name against both lists. Existing accounts must also be scanned to ensure no account is linked to any listed individual or entity. Non-compliance could lead to regulatory action.
What you must do
- Update your customer screening systems to include both the Al-Qaida Sanctions List and the 1988 Sanctions List from the UN.
- Before opening any new account, verify the proposed customer's name against both lists.
- Scan all existing accounts to identify and freeze any accounts linked to listed individuals or entities.
- Follow the procedure laid down in the MHA order of August 27, 2009, as per RBI circular of November 16, 2009.
- Ensure the Compliance Officer/Principal Officer acknowledges receipt of this circular.
Who it affects
All Primary (Urban) Co-operative Banks, Compliance Officers and Principal Officers of urban co-op banks, Customers of urban co-op banks
What are the two new UN sanctions lists I need to use?
The Al-Qaida Sanctions List (maintained by the 1267/1989 Committee) includes individuals and entities associated with Al-Qaida. The 1988 Sanctions List includes those previously listed under the Taliban sections of the old consolidated list.
Do I need to check both lists for every new account?
Yes, RBI mandates that before opening any new account, you must ensure the proposed customer's name does not appear in either the Al-Qaida Sanctions List or the 1988 Sanctions List.
What should I do if I find an existing account linked to a listed entity?
You must freeze the funds, financial assets, or economic resources held in that account, following the action steps detailed in paragraph 7 of RBI's November 16, 2009 circular.