Financial Crime World

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Korea, Democratic People’s Republic of: FATF Issues Public Statement on Anti-Money Laundering Concerns

The Financial Action Task Force (FATF), an intergovernmental body that sets international standards for anti-money laundering and combating the financing of terrorism and weapons of mass destruction, has issued a public statement highlighting the growing financial connectivity of North Korea with the international financial system. The FATF reiterated its concerns over North Korea’s continued failure to address significant deficiencies in its anti-money laundering regime and the serious threats posed by its illicit activities related to the proliferation and financing of weapons of mass destruction.

FATF Lists Jurisdictions Under Increased Monitoring

The FATF has updated its list of jurisdictions with strategic anti-money laundering/combating the financing of terrorism/combating the financing of proliferation of weapons of mass destruction (AML/CFT/CPF) deficiencies. US financial institutions should consider the FATF’s stance when reviewing their obligations under Section 311 of the USA PATRIOT Act.

Jurisdictions Under Increased Monitoring

  • North Korea
  • Iran

High-Risk Jurisdictions Subject to a Call for Action

North Korea and Iran are listed as High-Risk Jurisdictions Subject to a Call for Action, with the FATF urging jurisdictions to apply enhanced due diligence proportionate to the risks. US financial institutions must comply with extensive US restrictions and prohibitions against opening or maintaining correspondent accounts for North Korean or Iranian financial institutions.

UN Sanctions and US Government Sanctions

The United Nations has adopted several resolutions implementing economic and financial sanctions, while the US government maintains a robust sanctions program. Financial institutions should be familiar with the requirements and prohibitions contained in relevant UN Security Council Resolutions and US Office of Foreign Assets Control (OFAC) sanctions programs.

Relevant Sanctions Programs

  • UN Security Council Resolutions
  • US OFAC Sanctions Program

Reporting Suspicious Activities

Financial institutions are reminded to file a Suspicious Activity Report if they know, suspect, or have reason to suspect that a transaction involves funds derived from illegal activity or that a customer has otherwise engaged in activities indicative of money laundering, terrorist financing, or other violation of federal law or regulation.

Contact Information

Questions or comments regarding the contents of this release should be addressed to the FinCEN Regulatory Support Section at frc@fincen.gov.