FATF Public Statement - 22 February, 2019

Summary

This is a public notice from the BVI Financial Services Commission passing on two FATF statements issued 22 February 2019: the FATF Public Statement reaffirming counter-measures/enhanced due diligence calls against Iran and North Korea (DPRK), and the companion 'Improving Global AML/CFT Compliance: On-going Process' statement listing jurisdictions with strategic AML/CFT deficiencies. The FSC uses the notice to remind regulated and other persons subject to BVI AML/CFT law to factor these jurisdictional risk designations into their due diligence.

• DPRK: FATF calls on members to apply effective counter-measures and targeted financial sanctions, and to close DPRK bank branches/subsidiaries and terminate correspondent relationships where required by UNSC resolutions.
• Iran: FATF continues suspension of counter-measures but expects Iran to complete outstanding Action Plan items; financial institutions should apply enhanced due diligence to business relationships and transactions involving Iran.
• Jurisdictions with strategic AML/CFT deficiencies: The Bahamas, Botswana, Cambodia, Ethiopia, Ghana, Pakistan, Serbia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia and Yemen are listed as having agreed action plans with FATF; Iraq and Vanuatu are noted as no longer subject to the ongoing compliance process.
• FSC advisory: Regulated and other persons subject to the Anti-Money Laundering Regulations, 2008 and the Anti-Money Laundering and Terrorist Financing Code of Practice, 2008 are advised to note these FATF concerns and apply appropriate or enhanced customer due diligence measures for customers or transactions involving the identified jurisdictions.

The notice is informational in nature, reproducing FATF's own statements, but it operationalises an ongoing due-diligence expectation for BVI regulated entities rather than creating new BVI-specific rules or deadlines.

Key obligations

• Regulated and other persons subject to the AML Regulations 2008 and the AML/CFT Code of Practice 2008 must consider the money laundering/terrorist financing risks associated with Iran, DPRK and the listed deficient jurisdictions and apply appropriate or enhanced customer due diligence measures when dealing with customers or transactions involving those jurisdictions.
• Financial institutions should apply enhanced due diligence to business relationships and transactions with natural and legal persons from Iran, including obtaining information on the reasons for intended transactions and conducting enhanced monitoring.

Applies to

regulated persons under the Anti-Money Laundering Regulations 2008, persons subject to the Anti-Money Laundering and Terrorist Financing Code of Practice 2008, financial institutions

Deadlines

• June 2019: FATF stated that if Iran does not enact remaining AML/CFT legislation in line with FATF Standards by this date, FATF will require increased supervisory examination for branches and subsidiaries of financial institutions based in Iran.