SEBI

Obligations of Securities Market Intermediaries under PMLA – SEBI Master Circular

Guidelines on Anti-Money Laundering Standards and Combating the Financing of Terrorism. Obligations of Securities Market Intermediaries under PMLA

MASTER CIRCULAR

SEBI/HO/MIRSD/DOS3/CIR/P/2018/104                                                 

 July 04,2018

To,
All Intermediaries registered w ith SEBI under Section 12 of the Securities and Exc hange Board of India Act, 1992.

(Through the stock exchanges for stock  brokers and sub brokers, depositories for depository participants, Association of Mutual Funds in India (AMFI) for Asset Management Companies)

Subject: Guidelines on Anti-Money Laundering (AML) Standards and Combating the Financing of Terrorism (CFT) /Obligations of Securities Market Intermediaries under the Prevention of Money Laundering Act,2002 and Rules framed there under

1. The Prevention of Money Laundering Act , 2002 (“PMLA”) was brought into force with effect from 1st July Necessary Notifications I Rules under the said Act were published in the Gazette of India on July 01, 2005 by the Department of Revenue , Ministry of Finance , Government of India.

2. As per the provisions of the PMLA, every banking company, financial institution (which includes chit fund company, a co-operative bank, a housing finance institution and a non­ banking financial company) and intermediary (includes a stock -broker, sub-broker, share transfer agent , banker to an issue, trustee to a trust deed, registrar to an issue, asset management company , depository participant , merchant banker, underwriter , portfolio manager, investment adviser and any other intermediary associated with the securities market and registered under Section 12 of the Securities and Exchange Board of India Act , 1992 (SEBI Act )) shall have to adhere to client account opening procedures and maintain records of such transactions as prescribed by the PMLA and rules notified there under.

3. Pursuant to amendments made to the PMLA and Rules thereunder, updated guidelines in the context of recommendations made by Financial Action Task force (FATF) on anti­ money laundering standards is enclosed. These guidelines have been divided into two parts; the first part is an overview on the background and essential principles that concern combating Money Laundering (ML) and Terrorist Financing (TF). The  second  part provides a detailed account of the procedures and obligations to be followed by all registered intermediaries to ensure compliance with AMU  CFT  directives.  These guidelines shall also apply to their branches and subsidiaries located abroad , especially, in countries which do not or insufficiently apply the FATF Recommendations , to the extent local laws and regulations permit. When local applicable laws and regulations prohibit implementation of these requirements , the same shall be brought to the notice of SEBI.

4. The key circulars/ directives issued with regard to KYC, COD, A ML and CFT have been mentioned in Schedule These directives lay down the minimum requirements and it is emphasized that the intermediaries may, according to their requirements, specify additional disclosures to be made by clients to address concerns of money laundering and suspicious transactions undertaken by clients . Reference to applicable statutes and reporting guidelines for intermediaries is available at the website of the Financial Intelligence Unit – India (FIU-IND).

5. This Master Circular shall supersede the earlier Master Circular on A MLI CFT dated December 31, 2010.

Yours faithfully ,

Surabhi Gupta
Deputy General Manager

Phone No. 022-26449315
Email id: surabhig@sebi.gov.in

Download SEBI Circular Click Here >>

Share

Recent Posts

  • Income Tax

Exemption u/s 54 allowed despite failure to deposit in Capital Gains Accounts Scheme

ITAT allows exemption u/s 54 allowed despite failure to deposit the amount in Capital Gains Accounts Scheme and new asset…

19 hours ago
  • Income Tax

No addition to be made in hands of assessee solely on basis of uncorroborated loose-sheet

Addition cannot be made in the hands of the assessee solely on the basis of uncorroborated loose-sheet - ITAT In…

1 day ago
  • Income Tax

Claim of Leave Encashment exemption u/s 10(10AA)(ii) dismissed beyond Rs. 3 lakhs

ITAT dismisses claim of Leave Encashment exemption u/s 10(10AA)(ii) beyond Rs. 3 lakhs In a recent judgment, ITAT Ahmedabad has…

1 day ago
  • Income Tax

AO took a reasonable stand that 25 kg written in WhatsApp chat was 25 lakh – ITAT

Assessing Officer had taken a reasonable stand that 25 kg written in WhatsApp chat/text message was 25 lakh - ITAT…

2 days ago
  • Income Tax

Shareholders can’t be taxed for income from properties owned by the company – HC

Shareholders are only owners of the shares of the company therefore, income from properties earned by the company cannot be…

2 days ago
  • Income Tax

Jurisdictional error in reassessment approval can’t be shielded by the law of limitation

When approval for reassessment was granted by unauthorised authority, such jurisdictional error cannot be shielded by the law of limitation…

2 days ago