Perceiving a threat of money laundering and terror-financing in banking transactions with Iran , the Reserve Bank of India (RBI) has asked banks and other financial entities to be cautious in their dealings with entities and funds from the Middle East country.
The RBI circular issued to banks and other entities operating payment systems in
The FATF is an inter-governmental body responsible for making policies at national and international levels to combat money laundering and terror-financing.
As per the FATF warning, all financial institutions have been advised "to give special attention to business relationships and transactions with
The FATF has also warned against efforts to bypass or evade counter-measures and risk mitigation practices and urged financial institutions to take into account the risk of money laundering and terror-financing when considering requests by Iranian financial institutions to open branches and subsidiaries in their jurisdiction.
A similar circular has been issued by market regulator Sebi to the stock exchanges, with the objective of ensuring that Indian markets are not used by Iran-based firms for money laundering or terror-financing activities.
In turn, the stock exchanges have asked brokers to ensure compliance with the Sebi circular.
Paris-based FATF informs the central government of its member countries about all its cautionary notices and policies, which in turn are forwarded to the concerned enforcement and regulatory agencies.
The latest caution notice onIran was issued by the FATF to the Indian government late last year. The notice was later forwarded to Sebi, based on which the regulator issued a circular to market intermediaries.
The latest caution notice on
In its latest notice, FATF has named
FATF said it will consider asking its members to strengthen counter-measures in February, 2011, if
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