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JFSC AML/CFT Handbook Appendix D2 – BEWARE OF SOURCES 1 and 2

30/03/2021

In February, the JFSC Published updated versions of Appendices B, D1 and D2 of the AML/CFT Handbook to take into account the latest Financial Action Task Force (FATF) statements. IN doing so, they advised that Countries and territories listed under Sources 1 and 2 of Appendix D2 should be treated AS NOT COMPLIANT WITH FATF RECOMMENDATIONS for the purpose of Article 17A of the Money Laundering Order.  These requirements are effective immediately.

By way of reminder:

  1. Part 3A of the Money Laundering Order sets out exemptions from customer due diligence requirements, including circumstances in which exemptions do not apply (See Article 17A), exemptions from applying the third party and other identification requirements (See Articles 17B, 17C, 18) and the obligations of the relevant person who is exempt from applying third party identification requirements (See Article 17D)
  2. Part 3A of the Money Laundering Order provides exemptions from CDD requirements that apply in some strictly limited circumstances, as set out in Articles 17B - D and 18.
  3. Article 17A provides circumstances in which exemptions under this Part do not apply, namely where:
    • The relevant person suspects money laundering;
    • The relevant person considers that there is a higher risk of money laundering;
    • The relevant customer is resident in a country that is not compliant with the FATF recommendations; or
    • A relevant customer is a person in respect of whom Article 15(1)(c) applies.
  4. ALSO
    • You will also need to take particular care when considering placing reliance on an obliged person based in one of these countries and territories.
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