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Banks Asked to Comply with International Sanctions in Cross-Border Operations

The Central Bank of Lebanon issued Basic Circular 126 that calls for banks and financial institutions operating in Lebanon to strictly enforce measures to combat money laundering and terrorism financing,

particularly for customers who request cross-border transac tions with correspondent banks, as reported by Lebanon This Week, Byblos Bank economic publication.

 

It stipulated that banks and financial institutions should follow a risk-based approach by verifying the identity of individuals or companies involved in the transaction and those that have economic ownership, as well as by developing procedures to continuously monitor the related operations and accounts.

 

Also, the circular requested banks to update their databases relat- ed to anti-money laundering and terrorism financing information, and to notify the Special Investigation Commission about suspicious transactions.

 

The circular stressed that banks and financial institutions operating in Lebanon must conform to all sanctions imposed by international organizations and states on countries where the correspondent entity is located, as well as on the correspondents themselves. As such, it urged Lebanese institutions to exercise extreme caution in identifying the economic owners of the transactions, the report said.

 

 

Banks and financial institutions should monitor the transactions payable through accounts at correspondent banks and to apply strict due diligence processes. The Central Bank noted that auditors should verify the compliance of banks and financial institutions with the content of the circular, and should include their findings in their regular reports about compliance with anti-money laundering and terrorism financing measures.

Photo Rambergmediaimages

Beirut

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