• Thursday, October 23, 2014

ANTI-MONEY LAUNDERING EFFORTS

Banks to face random inspections

FATF plans to follow through that correct procedures are observed

Rejaul Karim Byron

All commercial banks will be randomly inspected by the Financial Action Task Force for compliance to anti-money laundering and counter-terrorist financing measures by the year-end, following Bangladesh's graduation from the global watchdog's grey list.
Bangladesh Bank yesterday conveyed the message to the banks' chief executive officers and advised the bankers to prepare for evaluation by FATF in a way that Bangladesh is not put back on the list.
FATF's grey list is an index of countries identified to have strategic deficiencies in their systems for fighting money laundering and terrorist financing, due to which financial transactions originating from the countries are subject to intense scrutiny.
“You will have to show the utmost cautiousness over suspected transactions,” BB Governor Atiur Rahman said at the meeting.
To heighten vigilance against money laundering and terrorist financing, the central bank has procured the software 'goAML' from the United Nations.
From now, all banks and agencies will have to submit their cash transaction reports through this software, and they have been advised to set up the supporting software at the earliest so that suspicious transactions can be automatically identified.
Foreign banks generally charge from 0.25 to 0.5 percent for opening of letters of credit, but the rate went upwards of 1 percent for Bangladeshi businessmen.
“The charge should come down a lot now, and I hope you exercise your best negotiation skills with the foreign banks in this regard,” Rahman told the CEOs.
The decision to graduate Bangladesh from the list came at the FATF's plenary on February 13, following a review of the progress made under the time-bound action plan provided by the global watchdog in October 2010.
The government has fulfilled most of the 28 action items, which includes: criminalising money laundering and terrorist financing; establishing and implementing procedures to identify and freeze terrorist assets; implementing procedures for the confiscation of funds related to money laundering.
A fully operational and effectively functioning Financial Intelligence Unit has been set up.
Suspicious transaction reporting requirements and international cooperation have been enhanced as well.
In November last year, a team of the FATF's Asia-Pacific Regional Review Group called in Bangladesh to verify the reforms.

“Now that Bangladesh has come out of the grey list, it cannot sit idle. The follow-up guidelines of the FATF will have to be fulfilled,” M Aslam Alam, secretary of the finance ministry's banking division that led the government's efforts, said on Monday at a press conference called in to announce the news.
At present, North Korea, Iran, Pakistan, Myanmar, Indonesia, Algeria, Ecuador, Ethiopia, Syria, Turkey and Yemen have been blacklisted as non-compliance countries by the FATF.

Published: 12:00 am Wednesday, February 19, 2014

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