SEBI tightens norms to prevent money laundering
- As per SEBI directive:
- Registered intermediaries shall carry out risk assessment to identify, assess &take effective measures to mitigate its money laundering & terrorist financing risk with respect to its clients, countries or geographical areas, nature & volume of transactions, payment methods used by clients.
- The risk assessment shall also take into account any country-specific information that is circulated by government & SEBI from time to time.
- The risk assessment shall be documented, updated regularly & made available to competent authorities & self regulating bodies when required.
- The market intermediates, can use a third party to carry out due diligence & determine identity of clients & beneficiaries of the funds. They have been asked to appoint designated directors to ensure compliance with new norms, who could face penal action in case of lapses.
- Stock exchanges through half yearly audits & inspections will monitor compliance of various entities.
- For mutual funds, boards of asset management companies and the trustees will monitor compliance to this SEBI circular.
- In case of other intermediaries, by their board of directors will monitor compliance.
- Securities & Exchange Board of India (SEBI)
- Market Intermediaries
- Mutual Funds (MF)
- Stock Exchange (SE)