Money changers to follow KYC norms
03 December 2005
Mumbai: Authorised money-changers have been told by the Reserve Bank of India (RBI) to follow the Know Your Customer (KYC) guidelines. The guidelines, which are part of the anti-money laundering measures, will be implemented before March 31, 2006.
An RBI circular says, "The anti-money laundering (AML) measures formulated should include customer identification procedure - KYC norms, disclosure of suspicious transactions and appointment of a money laundering reporting officer."
The RBI said money-changers, henceforth, must undertake transactions only after ensuring customer's credentials. For this purpose, they should retain photocopies of proof of identification after verifying the documents in original. Money-changers now have to insist on the presentation of passports for identification in all cases of sale of foreign exchange.
Money-changers have also been asked to implement additional measures such as staff training, maintenance of records and audit of transactions. The central bank said the measures should be formulated only after seeking board approval.
Money-changers also need to furnish details pertaining to transactions involving purchase of foreign exchange against payment, in cash exceeding Rs10 lakh from inter-related persons during the one month.