Anti- Money Laundering (AML) / Combating of Financing of Terrorism (CFT) Standards

 RBI/2011-12/196

DNBS(PD).CC. No 244/03.10.42/2011-12

September 22, 2011

All Non Banking Financial Companies /

Residuary Non Banking Companies

Dear Sir,

Anti- Money Laundering (AML) / Combating of Financing of Terrorism (CFT) Standards

Please refer to Company Circular No 218 dated May 04, 2011 on Anti- Money Laundering (AML) Standards / Combating of Financing of Terrorism (CFT) giving details about risk arising from the deficiencies in AML / CFT regime of Iran, Angola, Democratic People's Republic of Korea (DPRK), Ecuador, Ethiopia, Pakistan, Turkmenistan and Sao Tome and Principe.

2. Financial Action Task Force (FATF) has issued a  further statement dated June 24, 2011 on the subject (copy enclosed), calling  on its members and other jurisdictions to apply countermeasures to protect the international financial system from the ongoing and substantial money laundering and terrorist financing (ML/FT) risks emanating from Iran and Democratic People's Republic of Korea (DPRK).

3. This advisory does not preclude financial institutions entering into legitimate trade and business transactions with Iran.

4. FATF has also identified Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies. The FATF calls on its members to consider the risks arising from the deficiencies associated with each jurisdiction as described in the Statement: Bolivia, Cuba, Ethiopia, Kenya, Myanmar, Sri Lanka and Syria, Turkey.

5. All NBFCs (including RNBCs) are accordingly advised to take into account risks arising from the deficiencies in AML/CFT regime of these countries, while entering into business relationships and transactions with persons (including legal persons  and other financial institutions) from or in these countries/ jurisdictions.

Yours faithfully,

(Dr. Tuli Roy )

Deputy General Manager