What changed
RBI circulated four new notes from the UN Security Council's 1267 Committee (dated Jan 19, Jan 24, Feb 9, and Mar 10, 2011) that amend the Consolidated List of individuals and entities linked to Al-Qaida and Taliban. Urban Co-operative Banks are now required to incorporate these changes into their internal screening lists.
What it means for you
Urban Co-operative Banks must immediately update their customer screening databases with the latest UN sanctions list. Before opening any new account, banks must verify that the proposed customer's name is not on the list, and all existing accounts must be scanned for matches. Failure to comply could lead to regulatory action and reputational risk.
What you must do
- Update your internal consolidated list of terrorist individuals/entities with the four UN notes enclosed in this circular.
- Screen all new account applications against the updated list before onboarding.
- Scan all existing accounts to identify and freeze any accounts linked to listed entities or individuals.
- Follow the freezing procedures outlined in paragraph 6 of RBI circular dated November 16, 2009, as per the UAPA Order of August 27, 2009.
- Acknowledge receipt of this circular to your respective Regional Office through the Compliance/Principal Officer.
Who it affects
All Primary (Urban) Co-operative Banks, Compliance Officers and Principal Officers of Urban Co-operative Banks
What is the source of the updated list?
The updates come from the UN Security Council's 1267 Committee, as notified by the Government of India – Ministry of External Affairs. The full consolidated list is available on the UN website at http://www.un.org/sc/committees/1267/consolist.shtml.
What actions are required for existing accounts?
Banks must scan all existing accounts to ensure no account is held by or linked to any entity or individual on the updated list. If a match is found, banks must freeze the funds, financial assets, or economic resources as per the procedure in paragraph 6 of the November 16, 2009 circular.
Who should acknowledge receipt of this circular?
The Compliance Officer or Principal Officer of the Urban Co-operative Bank must acknowledge receipt to the concerned Regional Office of RBI.