What changed
RBI issued a circular on March 18, 2014, referencing FATF's updated statement and compliance document from February 14, 2014. Payment system operators must now factor in this latest FATF guidance on AML/CFT deficiencies in certain jurisdictions.
What it means for you
Banks and payment operators must align their AML/CFT checks with FATF's updated list of high-risk jurisdictions. While legitimate transactions are not prohibited, operators need to apply enhanced due diligence for cross-border flows involving these countries.
What you must do
- Review FATF's February 2014 statement and compliance document linked in the circular.
- Update your AML/CFT risk assessment frameworks to reflect the latest high-risk jurisdictions.
- Ensure your nodal or principal officer acknowledges receipt of this circular.
- Continue to allow legitimate trade but apply enhanced monitoring for transactions with listed jurisdictions.
Who it affects
All payment system operators authorized under the PSS Act, 2007, Nodal officers and principal officers of payment firms, Banks involved in cross-border payment processing
Does this circular ban transactions with the listed jurisdictions?
No. The circular explicitly states it does not preclude legitimate trade and business transactions with those countries and jurisdictions.
What should I do with the FATF documents referenced?
You must consider the information in FATF's updated statement and compliance document when designing or updating your AML/CFT controls.
Who needs to acknowledge receipt of this circular?
The nodal officer or principal officer of each payment system operator must acknowledge receipt.