Our Ref: G10/1C

27 September 2001

The Chief Executive
All Authorized Institutions

 

Dear Sir/Madam,

Financial Action Task Force ("FATF")
Non-cooperative countries and territories ("NCCTs")

In our letter of 3 August 2001 we advise that the FATF has decided to recommend the application of additional counter-measures against the Philippines as of 30 September 2001, unless its government enacts significant legislation which addresses the identified money laundering concerns. These procedures should be applied as of 30 September 2001. However, in case any significant legislation is enacted by the Philippines on or before that date, the application of counter-measures would be suspended and you would be notified via separate correspondence.

Following our earlier consultation with the industry Associations on the proposed counter-measures to be implemented, we have finalised the additional procedures to be adopted by authorized institutions ("AIs") in the opening and on-going monitoring of accounts for new customers from the Philippines. Details of the additional procedures are attached at Annex 1.

The earlier recommendation of the FATF also covers Nauru and Russia. In view of the progress made by the respective jurisdictions, the FATF has decided in its September 2001 Plenary that the application of counter-measures against Nauru should be postponed until 30 November, and that the recommendation in respect of Russia be withdrawn. You would be advised of the application of counter-measures against Nauru nearer the time. Also decided in the last FATF Plenary is the addition of Grenada and Ukraine to the list of NCCTs. The revised list now consists of 19 jurisdictions as follows:

  • Cook Islands

  • Dominica

  • Egypt

  • Grenada

  • Guatemala

  • Hungary

  • Indonesia

  • Israel

  • Lebanon

  • Marshall Islands

  • Myanmar

  • Nauru

  • Nigeria

  • Niue

  • Philippines

  • Russia

  • St. Kitts and Nevis

  • St. Vincent and the Grenadines

  • Ukraine

AIs are reminded to comply with Recommendation 211 of the Forty Recommendations by giving special attention to business relations and transactions with persons, including companies and financial institutions, from the above NCCTs. This is in addition to the requirements set out in the HKMA Guideline on Prevention of Money Laundering.

The opportunity is also taken to remind AIs of the need to enhance the knowledge and awareness of their staff on FATF anti-money laundering initiatives and NCCTs. AIs should include the relevant information where appropriate in their staff training programmes in respect of the prevention of money laundering, with special emphasis on the Philippines. Attention of the staff should also be drawn to the websites of the Narcotics Division of the Security Bureau, the Joint Financial Intelligence Unit and the HKMA for information relating to the prevention of money laundering and NCCTs. Annex 2 is a list of the relevant websites.

 

Yours faithfully,

 

Raymond Li
Executive Director (Banking Development)

Encl.

Annex 1
Annex 2

 

  1. Financial institutions should give special attention to business relations and transactions with persons, including companies and financial institutions, from countries which do not or insufficiently apply these Recommendations. Whenever these transactions have no apparent economic or visible lawful purpose, their background and purpose should, as far as possible, be examined, the findings established in writing, and be available to help supervisors, auditors and law enforcement agencies.

 

 
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