What changed
FATF issued a new statement on June 24, 2011, updating the list of jurisdictions with strategic AML/CFT deficiencies. RBI has forwarded this statement to all AD Category I Urban Co-operative Banks, replacing the earlier list from May 2, 2011. Banks are now required to consider this updated information in their AML/CFT frameworks.
What it means for you
Urban Co-operative Banks must update their AML/CFT risk assessments to reflect the latest FATF-identified jurisdictions. This ensures alignment with global standards and helps mitigate risks of money laundering and terrorist financing. Non-compliance could expose banks to regulatory scrutiny and reputational damage.
What you must do
- Review the enclosed FATF statement dated June 24, 2011, and update your bank's AML/CFT risk assessment accordingly.
- Ensure your Compliance Officer/Principal Officer acknowledges receipt of this circular to the respective RBI Regional Office.
- Incorporate the updated list of jurisdictions into your customer due diligence and transaction monitoring processes.
- Brief relevant staff on the changes to ensure consistent application of enhanced due diligence where required.
Who it affects
All AD Category I Primary (Urban) Co-operative Banks, Compliance Officers/Principal Officers of these banks, AML/CFT teams within these banks
What is the purpose of this FATF statement?
The FATF statement identifies jurisdictions with strategic deficiencies in their AML/CFT regimes. It calls on members to consider this information when assessing risks and applying countermeasures.
Do we need to take any action beyond acknowledging receipt?
Yes. Banks must consider the information in the statement for their AML/CFT risk assessments and update customer due diligence and monitoring processes as needed.
What happens if we do not comply?
Non-compliance may lead to regulatory action by RBI, including increased scrutiny or penalties, and could expose the bank to higher money laundering and terrorist financing risks.