RBI/2013-14/642
A. P. (DIR Series) Circular No. 143
June 16, 2014
To,
All Authorised Persons
Madam / Sir,
Know Your Customer (KYC) norms/Anti-Money Laundering (AML) standards/
Combating the Financing of Terrorism (CFT)/ Obligation of Authorised Persons
under Prevention of Money Laundering Act (PMLA), 2002 – Amendment to Section
13(2) – Money Changing Activities
Please refer to our A.P. (DIR Series) Circular No.17 [A.P. (FL/RL
Series) Circular No.04] dated November 27, 2009 on ‘Know Your Customer (KYC)
norms/Anti-Money Laundering (AML) standards/Combating the Financing of Terrorism
(CFT)/Obligation of Authorised Persons under Prevention of Money Laundering Act,
(PMLA), 2002, as amended by Prevention of Money Laundering (Amendment) Act, 2009
- Money changing activities’, as amended from time to time.
2. With the enactment of Prevention of Money Laundering (Amendment) Act, 2012
and amendment to Section 13 of the Act which provides for “Powers of Director to
impose fine”, the section 13(2) now reads as under:
“If the Director, in the course of any inquiry, finds that a reporting entity or
its designated director on the Board or any of its employees has failed to
comply with the obligations under this Chapter, then, without prejudice to any
other action that may be taken under any other provisions of this Act, he may—
- issue a warning in writing; or
- direct such reporting entity or its designated director on the Board or any of
its employees, to comply with specific instructions; or
- direct such reporting entity or its designated director on the Board or any of
its employees, to send reports at such interval as may be prescribed on the
measures it is taking; or
- by an order, levy a fine on such reporting entity or its designated director on
the Board or any of its employees, which shall not be less than ten thousand
rupees but may extend to one lakh rupees for each failure.”
3. In view of the above amendment, Authorised Persons may nominate a Director on
their Boards as “designated Director” to ensure compliance with the obligations
under the Prevention of Money Laundering (Amendment) Act, 2012. 4. The
directions contained in this Circular have been issued under Section 10(4) and
Section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and also
under the, Prevention of Money Laundering Act, (PMLA), 2002, as amended from
time to time and are without prejudice to permission /approvals, if any,
required under any other law.
Yours faithfully,
(B. P. Kanungo)
Principal Chief General Manager