FINTRAC calls for increased vigilance when dealing with financial entities from the Islamic Republic of Iran
FINTRAC calls for special attention to transactions related to the Democratic People's Republic of Korea
In order to protect the international financial system from money laundering and terrorist financing risks, the Financial Action Task Force (FATF) issued two statements on October 22, 2010 identifying jurisdictions that have strategic deficiencies in their anti-money laundering / combating the financing of terrorism (AML/CFT) regime.
In its October 22, 2010 statement, FATF re-affirmed the particular concerns it first expressed in its October 11, 2007 statement about the risk arising from deficiencies in the AML/CFT regime in the Islamic Republic of Iran. The FATF calls on its members to strengthen preventive measures to protect their financial sectors from such risks.
Accordingly, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) is alerting all reporting entities that are subject to the requirements of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, to the risk of doing business with individuals and entities based in Iran.
FINTRAC is advising that reporting entities should consider the above when deciding whether to file a suspicious transaction report in respect of financial transactions emanating from, or destined to Iran. Reporting entities are also encouraged to undertake enhanced customer due diligence with respect to clients and beneficiaries involved in such transactions.
The FATF also re-affirmed the concerns it expressed for the first time in its February 18, 2010 statement with respect to the strategic deficiencies in the Democratic People's Republic of Korea for which this jurisdiction has not committed to a remedial action plan.
Accordingly, FINTRAC is advising that reporting entities should consider giving special attention to transactions related to the above mentioned jurisdiction.
In June 2010, the FATF brought to the attention of its members several jurisdictions that have developed an action plan with the FATF to address identified strategic deficiencies. Those jurisdictions are: Angola, Antigua and Barbuda, Bolivia, Burma (Myanmar), Ecuador, Ethiopia, Greece, Indonesia, Kenya, Morocco, Nepal, Nigeria, Pakistan, Paraguay, Sri Lanka, Sudan, Syria, Thailand, Trinidad and Tobago, Turkey, Turkmenistan, Ukraine, and Yemen.
In October 2010, the FATF added the following to the list of jurisdictions that have developed an action plan with the FATF to address identified strategic deficiencies: Bangladesh, Ghana, Honduras, Philippines, Tanzania, Venezuela, Vietnam.
Since February 2008, the FATF had expressed concern with respect to strategic deficiencies for which Sao Tome and PrÃncipe had not committed to a remedial action plan. In October 2010, this jurisdiction made a high-level political commitment to work with the FATF and GIABA to address its strategic AML/CFT deficiencies. As such, the FATF has also added Sao Tome and PrÃncipe to the list of other jurisdictions that have developed an action plan with the FATF to address identified strategic deficiencies.
Finally, the FATF had expressed concerns related to deficiencies with the regimes in Azerbaijan (in the FATF's February 25, 2009 statement) and Qatar (in the FATF's February 18, 2010 statement). The FATF now recognized the progress made in these two jurisdictions and Azerbaijan and Qatar are no longer subject to FATF's enhanced monitoring process.
The text of the two FATF statements can be found at:
http://www.fatf-gafi.org
Canada is a member of the FATF and strongly supports its efforts to combat money laundering and terrorist financing.
The Office of the Superintendent of Financial Institutions (OSFI) has also issued a Notice to all federally regulated financial institutions. For a copy of the Notice, visit:
www.osfi-bsif.gc.ca
