The Hindu Business Line : KYC norms for money transfer services tightened

All authorised persons, who are Indian agents under the money transfer service scheme, should undertake profiling for each new customer, based on the customer's risk. The profile may contain information about the customer's identity, social or financial status and such other details, the Reserve Bank of India said.

Tightening the norms for money transfer services, the central bank said that the extent of due diligence will depend on risk perceived by the authorised persons. But while preparing the profile, the authorised persons should seek only such information which is relevant and not intrusive.

Some categories of customers who may require enhanced due diligence include, non-resident customers, high net-worth individuals, politically exposed persons and those with dubious reputation as per public information available, an RBI notice, issued here said.

Updation

The authorised persons should also introduce a system of periodical updation of customer identification data, if there is a continuing relationship.

In case of transactions, special attention should be given to all complex, unusually large receipts and all unusual patterns which have no apparent economic or visible lawful purpose.

Authorised persons must prescribe threshold limits for particular categories of receipts and pay attention to the receipts which exceed these limits.

High-risk receipts should be monitored according to set key indicators such as country of origin, sources of funds, the type of transactions involved and other risk factors. There should also be a periodical review of risk categorisation of customers, the RBI said.

All cross border inward remittance transactions under money transfer service scheme should be checked by concurrent auditors. The auditors must verify that the transactions have been undertaken in compliance with anti-money laundering guidelines and have been to concerned authorities whenever required.

Authorised persons should also watch out for any money laundering threats that may arise from new technology and account risks arising from anti-money laundering deficiencies in the regime of certain jurisdictions such as Iran, Uzbekistan, Pakistan and Turkmenistan among others.

Authorised persons should maintain proper records of all cash transactions of over Rs 10 lakh or its equivalent in foreign currency and if there are cash transactions, within a span of one month, which are connected to each other and which have been valued below Rs 10 lakh or its equivalent in foreign currency.

They should maintain records of client transactions for at least 10 years from the date of transaction, RBI said. Revised guidelines for money changing activities

The RBI also issued revised guidelines for money changing activities. It said that authorised persons should not undertake any transaction if it is not possible to carry out diligence measures, such as verifying the identity of the customer or obtaining documents, according to risk categorisation, due to non co-operation of the customer.

In all cases of sale of foreign exchange, irrespective of the amount involved, the authorised persons should insist for on the passport of the customer for identification purpose, the RBI said.

More Stories on : Financial Services | RBI & Other Central Banks

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
KYC norms for money transfer services tightened

Nabard to focus on 13 States for SHG-bank linkage programme

IBM is cheaper than Infosys!

Yields plunge as credit offtake remains sluggish

Bank wage arrears to be paid in cash

‘Dubai debt crisis will have limited impact'

Bank of Maharashtra to expand in unbanked areas