What changed
RBI issued a circular updating its earlier January 2013 guidance on AML/CFT risks from certain jurisdictions. It now incorporates FATF's February 22, 2013 statement and ongoing compliance document. The circular directs Authorised Persons to consider the updated FATF information when dealing with money changing activities.
What it means for you
Banks and money changers must refresh their AML/CFT risk frameworks to reflect the latest FATF list of high-risk and non-cooperative jurisdictions. While legitimate transactions are not banned, enhanced due diligence may be required for counterparties from these jurisdictions. The circular also extends these obligations to agents and franchisees, making franchisers responsible for their compliance.
What you must do
- Review the enclosed FATF statement and update your AML/CFT risk assessment for money changing activities.
- Ensure your Principal Officer acknowledges receipt of this circular.
- Communicate the updated guidance to all agents and franchisees and verify their compliance.
- Continue to allow legitimate transactions with listed jurisdictions but apply enhanced scrutiny where needed.
Who it affects
All Authorised Persons (banks and money changers), Agents and franchisees of Authorised Persons, Principal Officers of Authorised Persons
Does this circular ban transactions with the listed jurisdictions?
No. The circular explicitly states it does not preclude legitimate transactions with those countries and jurisdictions.
Are agents and franchisees covered by this circular?
Yes. The guidelines apply mutatis mutandis to all agents and franchisees, and franchisers are solely responsible for ensuring their compliance.