What changed
RBI issued a circular on January 10, 2013, referencing FATF's updated public statement and ongoing compliance document from October 19, 2012. Authorised persons must now consider this updated information when assessing risks from jurisdictions with AML/CFT deficiencies. The earlier guidance from August 23, 2012, is superseded by this update.
What it means for you
Banks and authorised persons must incorporate the latest FATF findings into their risk assessments for cross-border transactions and customer due diligence. While legitimate business with these jurisdictions is not prohibited, enhanced scrutiny is expected. The responsibility extends to all agents and franchisees, placing the onus on franchisers to ensure compliance.
What you must do
- Review FATF's October 2012 public statement and compliance document for updated high-risk jurisdictions.
- Update internal AML/CFT risk assessment frameworks to reflect the latest FATF guidance.
- Ensure all agents and franchisees are informed and adhere to the same AML/CFT standards.
- Continue to allow legitimate transactions but apply enhanced due diligence where warranted.
Who it affects
All authorised persons (banks, money changers, etc.), Agents and franchisees of authorised persons, Compliance and AML/CFT teams
Does this circular ban transactions with high-risk jurisdictions?
No, it explicitly states that it does not preclude legitimate transactions with those countries and jurisdictions.
Who is responsible for ensuring agents and franchisees comply?
The franchiser (authorised person) bears sole responsibility for ensuring their agents and franchisees adhere to these guidelines.