What changed
FATF issued a new statement on February 25, 2011, calling on listed jurisdictions to complete their action plans within a timeframe. RBI now requires RRBs to consider this updated statement, replacing the earlier January 17, 2011 circular.
What it means for you
RRBs must stay current with FATF's evolving list of high-risk jurisdictions to avoid facilitating illicit flows. Non-compliance could expose banks to regulatory action and reputational risk. This reinforces the need for robust AML/CFT screening and reporting mechanisms.
What you must do
- Review the enclosed FATF statement dated February 25, 2011, and update your bank's risk assessment accordingly.
- Ensure your Principal Officer acknowledges receipt of this circular to the respective RBI Regional Office.
- Incorporate the updated FATF list into your transaction monitoring and customer due diligence processes.
- Brief compliance and operations teams on the new jurisdictions and their action plan deadlines.
Who it affects
All Regional Rural Banks (RRBs), Principal Officers of RRBs, AML/CFT compliance teams at RRBs
What is the key difference between this circular and the January 17, 2011 circular?
The January circular forwarded an earlier FATF statement; this April 1 circular forwards FATF's updated statement of February 25, 2011, which calls on listed jurisdictions to complete their action plans within a timeframe.
Do we need to take any action beyond acknowledging receipt?
Yes. You must consider the information in the enclosed FATF statement and update your AML/CFT controls accordingly. Acknowledgment to the RBI Regional Office is mandatory.
What happens if we ignore this directive?
Ignoring FATF updates can lead to regulatory non-compliance, increased risk of money laundering or terrorist financing exposure, and potential penalties from RBI.