What changed
FATF updated its statement on February 16, 2012, regarding risks from AML/CFT deficiencies in certain jurisdictions. RBI now advises all banks and financial institutions to factor this updated information into their risk assessments.
What it means for you
Banks must incorporate FATF's latest findings into their AML/CFT due diligence processes. However, this does not prohibit legitimate business with those jurisdictions, so lenders should avoid blanket restrictions.
What you must do
- Review the enclosed FATF statement and update your AML/CFT risk assessments accordingly.
- Ensure your Principal Officer acknowledges receipt of this circular.
- Do not block legitimate trade transactions solely based on this advisory.
Who it affects
All scheduled commercial banks (excluding RRBs), Local Area Banks, All India Financial Institutions
Does this circular ban transactions with the listed jurisdictions?
No, it explicitly states that legitimate trade and business transactions with these countries are not precluded.
What should banks do with the FATF statement?
Banks must consider the information in the statement for their AML/CFT processes and ensure their Principal Officer acknowledges receipt.