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Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) Directive for Banks in Myanmar

Customer Due Diligence (CDD)

Banks in Myanmar are required to implement effective customer due diligence measures to prevent money laundering and terrorist financing. The key points of CDD include:

• Approval from Senior Management: Banks must obtain approval from senior management before establishing new correspondent relationships.
• Clear Understanding of Responsibilities: Clearly understand and document the respective AML/CFT responsibilities of each bank.
• Payable-Through Accounts: For “payable-through accounts,” banks must satisfy themselves that respondents have performed CDD obligations on customers with direct access to the accounts.

New Products and Business Practices

Banks in Myanmar are required to identify, assess, and manage money laundering or terrorism financing risks related to new products and business practices. This includes:

• Risk Assessment: The risk assessment should take place prior to launching new products or using new technologies.
• Prioritization of Risk Management: Banks must prioritize the management of identified risks.

Policies and Procedures on Wire or Electronic Transfers

Banks that engage in cross-border wire or electronic transfers are required to include accurate originator and recipient information, including:

• Originator Information: Accurate originator and recipient information
• Originator Account Number: Originator account number (if applicable)
• Originator’s Address: Originator’s address, customer identification, or date and place of birth
• Recipient Information: Recipient name and account number (if applicable)

If a bank is unable to comply with these specifications, it must not execute the wire or electronic transfer. For bundled cross-border transactions, banks need only include the originator’s account number or unique transaction reference number.

Reporting Requirements

Banks in Myanmar are required to report certain transactions to the Financial Intelligence Unit (FIU), including:

• Cross-Border Transactions: Cross-border wire or electronic transfers in excess of USD 10,000
• Domestic Transactions: Domestic wire or electronic transfers in excess of 100 million kyats
• Incomplete Information: Transfers with incomplete or unavailable originator information

Suspicious Transaction Reporting

Banks in Myanmar are required to report suspicious transactions to the FIU.

Conclusion

Overall, this directive aims to strengthen AML/CFT regulations for banks in Myanmar, including customer due diligence, risk management, and reporting requirements. By implementing these measures, banks can help prevent money laundering and terrorist financing activities and maintain a safe and secure financial system.