State Bank of Pakistan (SBP) has published a Framework for Managing Risks of Trade Based Money Laundering and Terrorist Financing.
The prime objective of the framework is to strengthen Pakistan’s trade related anti-money laundering and counter financing of terrorism (AML/CFT) regime and conserve foreign exchange.
The framework has a strong focus on trade-based money laundering (TBML) and applies to all banks authorised by SBP to deal in foreign exchange.
Monitoring and due diligence
Amongst the strict monitoring and enhanced due diligence requirements for all trade related transactions, banks must adopt a rigorous screening of customers procedures.
Banks should also have procedures for complete risk profiling of customers in or intending to trade as well as systems for identifying and monitoring related party trade transactions.
Verification and identification
Procedures for verification of prices of underlying contracts related to import and export deals of all goods and services are required by the framework issued by SBP.
It says that banks must also have procedures for identifying dual use goods and identify both the end-user and end-usage of goods and services.
The SBP’s Framework for Managing Risks of Trade Based Money Laundering and Terrorist Financing can be found here.
Categories: Trade Based Financial crimes News