Banking Regulations Crack Down on Money Laundering and Terrorist Financing

The government has introduced new regulations aimed at combating money laundering, terrorist financing, and proliferation financing in the country. The Anti-Money Laundering Regulations require financial institutions to adopt robust customer due diligence procedures to prevent these illegal activities.

Exceptions to Identification Document Requirements

Under the new regulations, identification documents will not be required in exceptional circumstances, including:

• When a customer is not a citizen or resident of the country and cannot obtain a national identity card.
• Where existing laws do not permit customers to acquire a national identity card.
• When a customer’s national identity card has been lost and they present a police loss report.
• For low-risk customers in money laundering, terrorist financing, and proliferation financing risk assessments.

Monitoring Business Relationships

Financial institutions will be required to monitor business relationships with customers and ensure that their information is regularly updated based on the customer’s money laundering, terrorist financing, and proliferation financing risk profile. Registration documents must also be renewed timely and not expired.

Suspension of Accounts

If a customer’s identification document or entity registration document has expired, the account will be suspended until the relevant document is renewed or another acceptable document is provided. In such cases, only limited activities will be permitted on the account, including:

• Deposits
• Withdrawals by the financial institution for pre-existing loans or operational charges
• Closure of the account

Internal Procedures

Financial institutions must establish internal procedures that require satisfactory evidence of a customer’s identity before establishing a business relationship or conducting an occasional transaction. The procedures should include:

• Step-by-step instructions for employees to follow in verifying customer information
• Management responsibility for enforcing compliance with anti-money laundering regulations
• Allocation of duties and responsibilities to employees

Enhanced Due Diligence Measures

Financial institutions will be required to apply enhanced due diligence measures and ongoing monitoring in cases identified as high-risk of money laundering, terrorist financing, or proliferation financing. This includes transactions or business relationships with persons established in high-risk jurisdictions.

The new regulations aim to prevent the misuse of financial systems for illegal activities and ensure that financial institutions play a key role in combating these threats.