Banks asked to monitor foreign currency accounts
KARACHI: State Bank of Pakistan (SBP) has instructed commercial banks to maintain record of individuals with monthly transaction of $10,000 and entities with $25,000 or equivalent values of other foreign currencies to prevent use of banking channels for terrorist activities. "Authorized dealers are advised to ensure that consolidated data/record of transactions routed through foreign currency accounts of individuals/entities is maintained by them at their head offices on monthly basis, in addition to the data/record already being maintained," circular issued stated. Data of those personal foreign currency accounts maintained by individuals where aggregate amount exceeds $10,000 or its equivalent in other foreign currencies is deposited in, withdrawn from or remitted out from the account during the month.
Data of foreign currency accounts maintained by entities where aggregate amount exceeding $25,000 or its equivalent in other foreign currencies is deposited in, withdrawn from or remitted out from the account during the month as per attached format.
It may be noted that in pursuance of sub-section (7) of section 7 of the Anti-Money Laundering Act, 2010 (as amended in 2015), reporting entities including Authorized Dealers are under obligation to conduct Customer Due Diligence (CDD) and maintain record of transactions, account files and documents obtained through such diligence in accordance with the regulations issued by the SBP. In this regard, it is reiterated that Authorized Dealers must ensure strict observance of all applicable instructions including Regulations/Guidelines issued by SBP regarding KYC/CDD while opening and maintaining foreign currency accounts. Further, ongoing CDD is an essential part of an effective Anti Money Laundering (AML) and Combating the Financing of Terrorism (CFT) regime and applies to all customers to whom the Authorized Dealers are offering any type of service(s). With the view to preserve the integrity, soundness and safety of the financial system, State Bank of Pakistan (SBP) has been endeavoring to prevent the possible use of the banking sector for money laundering, terrorist financing and illegal transfer of funds.