Interest Rates/Returns Due on Account: Financial Institutions Must Take Note

Failure to Comply with Obligations May Lead to Sanctions

The National Counter Terrorism Committee (NCTC) has issued a directive requiring financial institutions and designated non-financial businesses and professions (DNFBPs) to comply with targeted financial sanctions (TFS). This move is part of efforts to prevent the financing of terrorism and money laundering.

Key Requirements

According to the NCTC’s decision No. 1/2022, financial institutions and DNFBPs must:

• Notify the committee in case of a change in ownership or control of an account
• Maintain high standards of employee recruitment and training
• Implement effective internal controls and procedures to detect and prevent money laundering and terrorist financing

Consequences of Non-Compliance

Failure to comply with the obligations outlined in the NCTC’s decision may result in:

• Administrative fines ranging from OMR 5,000 to OMR 20,000 for non-compliance
• Penalties of up to OMR 10,000 for failure to freeze funds or economic resources in accordance with the directive

Confidentiality

The NCTC has emphasized the importance of confidentiality in these matters. Any person who is exempt from liability for freezing funds or refusing to make them available shall not disclose information related to the freezing measures.

Take Note

The NCTC’s decision No. 1/2022 aims to prevent the financing of terrorism and money laundering, and all financial institutions and DNFBPs are urged to take note of these obligations. It is essential for these entities to comply with the requirements to avoid any potential consequences.