Stock brokers have been directed to furnish details about their compliance with various anti- money laundering requirements as the government steps up efforts to deal with the black money menace.
Amid the crack down on shell companies, the Finance Ministry has sought detailed information with respect to stock brokers in order to understand their compliance levels in terms of norms pertaining to curb money laundering and terror financing activities.
Following a directive from the Department of Economic Affairs, markets regulator Sebi has now asked stock brokers to submit the relevant details as early as this month itself.
Information has been sought with respect to “Anti-Money Laundering and Combating Financing of Terrorism (AML and CFT) areas to assess the technical compliance with the global FATF recommendations and effectiveness of AML/CFT systems”.
Details have to be furnished by the stock brokers for the last three financial years.
Complying with Sebi directions, leading exchange BSE has asked stock brokers registered with it to provide the information.
The details are required to be submitted for 2014-15, 2015-16 and 2016-17, according to a circular issued by BSE.
Stock brokers have to keep these details ready in a prescribed format separately for each financial year.
The brokers are required to be given information on total number of employees with the organisation, number of employees who acquired certification in AML/ CFT areas, per- centage of employees who were imparted ‘in-house’ training in AML/CFT areas and percentage of employees found to be familiar with AML/CFT guidelines from surveys conducted, for each of the last three financial years.
Total number of employees include those in clerical and supervisory cadres up to the level of senior management but should exclude those in subordinate cadre as well as officials in top executive grades.
“In-house training indicates learning sessions of a minimum one-hour duration on AML/CFT areas, conducted by the organisation for the benefit of their employees as part of their internal training programmes/ workshops,” BSE said.
“Employees found to be familiar with AML/CFT guidelines can be ascertained from conducting surveys across different verticals and geographies. The survey reports must include the size of the group studied. Copies of such survey reports should be attached with this return,” it added.
Financial Action Task Force (FATF), an inter-governmental body, sets global standards for anti-money laundering and countering financing of terrorism regulations for governments worldwide. India has been its member since 2010.