What changed
The UNSC added two Afghanistan-based individuals to its ISIL (Da'esh) and Al-Qaida Sanctions List on April 26, 2023: Maulawi Rajab (senior ISIL-K leader) and Sultan Aziz Azam (ISIL-K spokesperson). RBI now mandates all regulated entities to update their screening databases and apply asset freeze, travel ban, and arms embargo measures accordingly.
What it means for you
Banks and lenders must immediately cross-check customer databases and transaction records for any matches with these two new entries. Failure to freeze assets or report matches could lead to regulatory action under UAPA and KYC master directions. This also reinforces the need for real-time sanctions screening systems.
What you must do
- Update your UNSC sanctions screening list with the two new entries (QDi.434 and QDi.435) immediately.
- Run a backward-looking scan of existing accounts and transactions for any matches with Maulawi Rajab or Sultan Aziz Azam.
- Freeze any identified assets and report to the Financial Intelligence Unit (FIU) and MHA within the stipulated timeline.
- Forward any delisting requests received from customers to Joint Secretary (CTCR), MHA electronically.
- Ensure compliance with Sections 51, 52, and 53 of the KYC Master Direction and the UAPA Order of Feb 02, 2021.
Who it affects
All scheduled commercial banks, Non-banking financial companies (NBFCs), Payment system operators, Cooperative banks, All other regulated entities under RBI
What is the deadline for implementing these new sanctions?
The RBI circular is dated April 27, 2023, and advises immediate action. There is no specific grace period; regulated entities must update their screening lists and freeze assets without delay.
How do I handle a customer who claims they are wrongly listed?
Any delisting request received by your entity must be forwarded electronically to Joint Secretary (CTCR), Ministry of Home Affairs. The individual can also approach the UN Ombudsperson directly via the link provided in the circular.
Are these sanctions only for accounts, or do they cover transactions too?
They cover both. The UNSC resolution imposes an assets freeze, travel ban, and arms embargo. You must freeze all funds and economic resources belonging to or controlled by these individuals, and reject any transactions involving them.