In accordance with the Circular No.10 of 2022 issued by the Financial Services Authority (the “FSA”) on the 07th of November 2022, the FSA would like to draw the attention to all reporting entities (i.e. Securities Dealers) about the decision taken by FATF during its meeting on the 20-21 October 2022, with regards to countries placed under increased monitoring.
Following is a summary of the main points for consideration:
1. High risk jurisdictions subject to a Call for Action
- Jurisdictions subject to a FATF call on its members and other jurisdictions to apply countermeasures
- Iran and Democratic People’s Republic of Korea are the jurisdictions that remain as the jurisdictions with significant strategic deficiencies on Money Laundering / Terrorist Financing and Proliferation Financing.
- Jurisdiction subject to a FATF call on its members and other jurisdictions to apply enhanced due diligence measures proportionate to the risks arising from the jurisdiction
- Myanmar is in the list of countries subject to a call for action and the FATF call on its members and urge all jurisdictions to apply enhanced due diligence to business relations and transactions with Myanmar.
You may refer to FATF’s website with the high risk jurisdictions subject to a call for action as identified by the FATF.
2. Jurisdictions under increased monitoring
- New added jurisdictions subject to increased monitoring list are Democratic Republic of the Congo, Mozambique and Tanzania. For the full list that includes all jurisdictions under increased monitoring as identified by the FATF can be found in FATF’s website.
3. Jurisdictions no longer under increased monitoring
- Nicaragua and Pakistan are no longer subject to the FATF’s increased monitoring process.
4. Obligation to apply Enhanced Due Diligence (EDD) and Enhanced On-going Monitoring (EOM) to Higher Risk Jurisdictions
- The reporting entities (i.e. Securities Dealers) will need to apply EDD and EOM required under section 35 of the AML/CFT Act on a risk-sensitive basis in relation to the countries that do not apply or fully apply the FATF recommendations. All reporting entities need to ensure that they remain up to date with FATF and review the FATF’s website (https://www.fatf-gafi.org/ ) on a continuous basis to identify whether any changes or updates have been published by the FATF.