The AML/CFT Circular issued by the Hong Kong Securities and Futures Committee includes, besides updates to the UN’s anti-terror (ISIL and Al-Qaida) sanctions (see attached web notices), the following updates from FATF:
(1) FATF Statement on Iran and Democratic People’s Republic of Korea
Further to our circular issued on 6 November 2015, this is to inform you that the Financial Action Task Force (“FATF”) issued an updated statement Note 1 on 19 February 2016 identifying a number of jurisdictions that have strategic deficiencies in their anti-money laundering and combating the financing of terrorism (“AML/CFT”) regimes.
Jurisdictions subject to a call on its members and other jurisdictions to apply counter-measures are as follows:
The FATF remains particularly and exceptionally concerned about Iran’s failure to address the risk of terrorist financing and the serious threat this poses to the integrity of the international financial system. The FATF calls on its members and other jurisdictions to apply counter-measures to protect the international financial system from the on-going and substantial money laundering and terrorist financing risks emanating from the jurisdiction.
Democratic People’s Republic of Korea (“DPRK”)
The FATF remains concerned by the DPRK’s failure to address the significant deficiencies in its AML/CFT regime and the serious threat this poses to the integrity of the international financial system. The FATF calls on its members and other jurisdictions to apply counter-measures to protect the international financial system from the on-going and substantial money laundering and terrorist financing risks emanating from the jurisdiction.
Licensed corporations (“LCs”) and associated entities (“AEs”) should continue to apply the measures specified in our circulars of 31 March 2009 and 15 April 2011(http://www.sfc.hk/edistributionWeb/gateway/EN/circular/openFile?refNo=H545 & http://www.sfc.hk/edistributionWeb/gateway/EN/circular/openFile?refNo=H628) in relation to transactions associated with Iran and DPRK respectively. LCs and AEs are also reminded to apply relevant guidance as specified in the FATF statement Note 1 and implement appropriate measures and safeguards accordingly.
(2) FATF Statement on Improving Global AML/CFT Compliance: On-Going Process
In addition, please be informed that in a separate statement as part of the on-going process to improve global AML/CFT compliance, the FATF has set out an updated list of jurisdictions that have strategic AML/CFT deficiencies for which they have developed an action plan with the FATF. The FATF will closely monitor the implementation of those action plans and encourage its members to consider the information presented in the statement which can be found on the website of the FATF (http://www.fatf-gafi.org/publications/high-riskandnon-cooperativejurisdictions/documents/fatf-compliance-february-2016.html).
As the FATF will continue to assess the progress made by these jurisdictions in addressing the deficiencies in their AML/CFT systems and issue updated statements from time to time, LCs and AEs are reminded to browse the website of the FATF for the latest information.
(3) Outcomes from the Meeting of the FATF Plenary, 17-19 February 2016
In addition to the statements in (1) and (2) above, the FATF has also published various other outcomes of its recent Plenary Meeting which may be of interest to LCs and AEs. They include, for example, (i) approval of a Consolidated FATF Strategy on Combating Terrorist Financing; (ii) developments on de-risking; and (iii) FATF granted full membership to Malaysia. Further information can be found on the website of FATF (http://www.fatf-gafi.org/publications/fatfgeneral/documents/outcomes-plenary-february-2016.html).
HK SFC Notice
HK SFC Circular
UN Web Notices