On the sidelines of industry regulator’s warning, PSBs including Mumbai headquartered State Bank of India and Bank of Baroda are creating stricter norms on anti-money laundering (AML) framework for their branches outside India that can stop or detect cash and suspicious transactions.
- Priority areas for creating a separate and stronger anti-money laundering (AML) framework are Europe, United States and high risk regions like Dubai, South Africa, Mauritius and Singapore.
- SBI has induced Deloitte HK to create an AML framework.
From the past few months, many Indian banks including PSBs are looking forward to enhance their AML compliance framework due to stringent compliance regulations in some countries. But the idea is not limited to enhancement but it also bulls eyeing a new target operating model for AML compliance which will assent with regulations in India and in the jurisdictions where banks operate.
What AML Framework include?
AML framework includes checking the credentials of all the people who have a bank account. The banks are also required to know the source of the money that is being deposited, withdrawn or transferred.
- As per the Bank Secrecy Act and anti-money-laundering (BSA/AML) regulatory environment, banks are required to take reviews of customer’s accounts and transactions over a definite period of time.
What is Anti Money Laundering?
Anti-Money Laundering or AML is a set of procedures, laws or regulations designed to stop the practice of generating income through illegal actions.
