Monday, February 27, 2012

Central bank asks banks and financial institutions to keep hawk’s eye on clientele

The central bank today asked the banks and financial institutions to keep tab on their clients more effectively to control money laundering and fight terrorist financing.
Issuing a directive that has replaced earlier one on know-your-client (KYC) — by the Financial Information Unit (FIU) — it has made mandatory for the banks and financial institutions to follow it thoroughly. “It is mandatory also due to the country’s commitment to the Financial Action Task Force (FATF) — the global body that keeps watch on money laundering and terrorists financing — recently,” according to the central bank.
The banks and financial institutions now need to adopt and implement customer due diligence meaning they should keep track of all their clients and report suspicious transactions to the FIU, the focal point under the central bank.
They have to take necessary measures to identify suspicious transactions and strictly abide by the law and regulations related with anti-money laundering and terrorism financing, he said, adding that the banks and financial institutions must make sure that branches throughout the country maintain the rule.
The central bank has asked the banks and financial institutions to closely monitor customers having multiple transactions, even if the volume is small, and keep tab on electronic transfers, both receipts and paid, too.
“They must list their customers into three categories — highly risk, medium risk and low risk — depending on the risks, they are exposed to,” the central bank said.

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