FinCEN issues statements on its lists of jurisdictions with AML/CFT/CPF deficiencies

Financial Crimes Of Interest to Non-US Persons FinCEN Anti-Money Laundering Combating the Financing of Terrorism FATF Combating Weapons of Mass Destruction Proliferation Financing OFAC

On October 31, FinCEN announced that the Financial Action Task Force (FATF) issued public statements updating its lists of jurisdictions with strategic deficiencies in anti-money laundering (AML), countering the financing of terrorism (CFT), and countering the financing of proliferation of weapons of mass destructions (CPF). FATF’s statements include (i) Jurisdictions under Increased Monitoring, “which publicly identifies jurisdictions with strategic deficiencies in their AML/CFT/CPF regimes that have committed to, or are actively working with, the FATF to address those deficiencies in accordance with an agreed upon timeline,” and (ii) High-Risk Jurisdictions Subject to a Call for Action, “which publicly identifies jurisdictions with significant strategic deficiencies in their AML/CFT/CPF regimes and calls on all FATF members to apply enhanced due diligence, and, in the most serious cases, apply counter-measures to protect the international financial system from the money laundering, terrorist financing, and proliferation financing risks emanating from the identified countries.”

FinCEN’s announcement also informed members that FATF added Burma to the list of High-Risk Jurisdictions Subject to a Call for Action, and advised jurisdictions to apply enhanced due diligence proportionate to the risks. Moreover, U.S. financial institutions should continue to refer to existing FinCEN and Office of Foreign Assets Control guidance on engaging in financial transactions with Burma. Removed from the list of jurisdictions subject to increased monitoring are Nicaragua and Pakistan. With respect to high-risk jurisdictions subject to a call for action — the Democratic People’s Republic of Korea and Iran — “financial institutions must comply with the extensive U.S. restrictions and prohibitions against opening or maintaining any correspondent accounts, directly or indirectly, for North Korean or Iranian financial institutions,” FinCEN said, adding that “[e]xisting U.S. sanctions and FinCEN regulations already prohibit any such correspondent account relationships.”