July 9, 2006	Sunday	Jumadi-ul-Sani 12, 1427

KARACHI, July 8: The State Bank of Pakistan in a move to curb money laundering has introduced amendments in the Prudential Regulations for Corporate/Commercial Banking making the opening of bank accounts more difficult.

The central bank in a circular issued here on Saturday stated that the amendments had been made to ensure compliance with Financial Action Task Force recommendations on money laundering.

It said that this move was aimed at safeguarding the interest of depositors from risks arising out of money laundering and to reinforce the measures taken by the banks and DFIs for proper management of their institutions.

The circular says that copies of CNIC wherever required will invariably be verified, before opening the account, from NADRA through utilising on-line facility or where the banks or DFIs or their branches do not have such facility through arrangement with regional offices of NADRA.

It says that banks and DFIs are required to include accurate and meaningful originator information (name, address and account number) on funds transfers including wire transfers and related messages that are sent, and the information should remain with the transfer or related message throughout the payment chain.

However, banks and DFIs may, if satisfied, substitute the requirement of mentioning address with CNIC, passport, driving license or similar identification number for this purpose, it adds.

It further says if the bank or DFI suspects, or has reasonable grounds to suspect, that funds are the proceeds of a criminal activity or terrorist financing, it should report promptly, its suspicions, through compliance officer of the bank or DFI to Banking Policy Department of the State Bank of Pakistan.

The report should contain the information (a) title, type and number of the accounts, (b) amounts involved, (c) detail of the transactions, (d) reasons for suspicion.

The central bank has been encouraging banks and DFIs to make use of technology and upgrade their systems and procedures in accordance with the changing profile of various risks. Accordingly, all banks and DFIs were advised to implement systems which could flag out of pattern transactions for reporting suspicious transactions.