Financial Crime World

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Jordanian Banks Face Increased Regulation to Combat Money Laundering and Terrorist Financing

Amman, Jordan - The Bank Secrecy Act (BSA) regulations have taken center stage in Jordan’s financial sector as banks face increased scrutiny to prevent money laundering and terrorist financing activities.

BSA Regulations

The Jordanian Central Bank has implemented strict regulations for banks operating in the kingdom. These regulations require:

  • Establishing effective BSA compliance programs
  • Conducting customer due diligence
  • Screening against government lists
  • Reporting suspicious activity

BSA Examinations

The Jordanian Central Bank conducts regular examinations of commercial banks, Islamic banks, and branches of foreign banks operating in the country to ensure compliance with the BSA. The examinations assess a bank’s:

  • Risk-based anti-money laundering (AML) program
  • Customer due diligence systems
  • Monitoring programs

Suspicious Activity Reports

Under the BSA regulations, banks are required to file Suspicious Activity Reports (SARs) with the Jordanian Central Bank within 30 calendar days of initial detection of facts that may constitute a basis for filing a SAR. The reports must be filed electronically using the Bank Secrecy Act BSA E-Filing System.

Counter-Terrorist Financing

Jordanian banks play a crucial role in combating terrorist financing by identifying and reporting potentially suspicious activity as required under the BSA. Banks are also required to screen against government lists, including those designated by the United Nations and other international organizations.

Money Laundering Risks

Money laundering poses significant risks to Jordan’s financial system, and banks must establish effective risk-based AML programs to identify and mitigate these risks. The regulations require banks to:

  • Develop procedures for monitoring transactions
  • Identify unusual activity
  • Report suspicious transactions

Resources Available

The Jordanian Central Bank has made several resources available to assist banks in implementing the BSA regulations, including:

  • Guidance documents
  • Training materials
  • Industry best practices

In conclusion, the BSA regulations are a critical component of Jordan’s efforts to combat money laundering and terrorist financing. Banks operating in the kingdom must ensure compliance with these regulations to maintain their licenses and avoid severe penalties.