What changed
The UNSC updated its sanctions list with amendments to 14 entries, including individuals like Khalid Abd Al-Rahman Hamd Al-Fawaz and Saifi Ammari, as per UNSC press release SC/15560 dated January 10, 2024. RBI has directed all regulated entities to incorporate these changes into their compliance checks under Section 51A of UAPA, 1967.
What it means for you
Banks and lenders must immediately update their KYC and AML screening databases to reflect the amended UNSC list. Failure to identify and freeze assets of these individuals could lead to non-compliance with UAPA and RBI guidelines. This reinforces the zero-tolerance approach to terrorist financing.
What you must do
- Update your AML screening systems with the 14 amended UNSC entries immediately.
- Cross-check existing customer databases against the revised list for any matches.
- Freeze and report any accounts linked to these individuals in accordance with Section 51A of UAPA and RBI Master Direction on KYC.
- Train compliance teams on the updated sanctions list and UAPA Section 51A obligations.
Who it affects
All scheduled commercial banks, Non-banking financial companies (NBFCs), Payment system operators, Cooperative banks, All other RBI-regulated entities
What is the legal basis for this update?
Section 51A of the Unlawful Activities (Prevention) Act, 1967, read with RBI's Master Direction on KYC, requires regulated entities to ensure no accounts are held for individuals/entities on the UNSC sanctions list.
How quickly must we act on these amendments?
Immediately. The circular is dated January 11, 2024, and any delay in updating screening systems could result in non-compliance with UAPA and RBI guidelines.
What happens if we find a match?
You must freeze the account or asset without prior notice to the customer, and report the action in accordance with Section 51A of UAPA and RBI Master Direction on KYC.