Financial Crime World

Effective AML/CFT Policies and Procedures in Oman

The Sultanate of Oman has implemented robust Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) regulations to safeguard its financial system. The National Committee for Anti-Money Laundering and Combating the Financing of Terrorism (NAC) serves as the primary coordinating body, ensuring compliance with international standards.

Key Regulatory Requirements

Risk Assessment

  • Financial institutions must evaluate money laundering and terrorism financing risks, documenting them clearly.
  • This assessment helps identify areas that require additional attention to prevent illicit activities.

Customer Classification

  • Customers are categorized into Low, Normal, and High risk categories based on their risk profile.
  • This classification allows financial institutions to tailor their due diligence measures accordingly.

Due Diligence Measures

  • Prohibition on anonymous accounts
  • Verification of customer information through reliable documents (e.g., passport, ID card)
  • Identification of beneficial owners

Compliance with Identification and Verification

Financial institutions must:

Verify Customer Identity

  • Verify the identity of customers and beneficial owners.
  • This includes collecting and verifying identification documents.

Maintain Accurate Records

  • Maintain accurate records of customer due diligence information.
  • These records are essential for auditing and regulatory purposes.

Enhanced Due Diligence

  • Apply enhanced due diligence measures for high-risk customers.
  • This may include more frequent monitoring or additional documentation requirements.

Transaction Monitoring and Reporting

Financial institutions must:

Scrutinize Transactions

  • Scrutinize complicated and unusual large transactions.
  • This helps identify potential money laundering or terrorism financing activities.

Report Suspicious Transactions

  • Reports of suspicious transactions must be filed with the Center within a specified timeframe.
  • These reports help regulatory bodies track and investigate illicit activities.

Internal Policies, Controls, and Procedures

Financial institutions should:

Establish AML/CFT Policy

  • Create and apply AML/CFT policies, controls, and procedures in compliance with the Law and relevant Central Bank of Oman decisions.
  • This policy serves as a guide for employees to follow.

Appoint Compliance Officer

  • Appoint a senior management-level compliance officer responsible for AML/CFT obligations.
  • This officer is accountable for ensuring compliance.

Conduct Regular Audits

  • Conduct regular audits to assess compliance with AML/CFT policies and the Law.
  • These audits help identify areas for improvement.

Ongoing Employee Training

Regular training is essential to keep employees updated on new developments and obligations related to AML/CFT. This includes:

Stay Current on Regulations

  • Train employees on changes to AML/CFT regulations and guidelines.
  • This ensures employees understand their responsibilities.

By implementing these effective AML/CFT policies and procedures, financial institutions in Oman can mitigate money laundering and terrorism financing risks, ensuring a safer and more secure financial system for all stakeholders.