Article 9
| No: 14525 | Date(g): 8/11/2017 | Date(h): 19/2/1439 | Status: In-Force |
Effective from 2017-11-08 - Nov 07 2017
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| 1- | Before entering into a cross-border correspondent relationship, financial institutions shall apply appropriate risk mitigation measures as prescribed by the Implementing Regulation, and shall satisfy themselves that the respondent institution does not permit their account to be used by a shell bank. | |
| 2- | Financial institutions shall not enter into or continue a correspondent relationships with a shell bank or a respondent institution that permits its account to be used by a shell bank. |
9/1
Before entering into a cross-border correspondent relationship, a financial institution shall apply the following risk mitigating measures:
| a. | gather sufficient information about the respondent institution to understand fully the nature of the respondent’s business, and determine from publicly available information the reputation of the institution and the quality of supervision, and whether the respondent institution has been subject to a money laundering investigation or regulatory action; | |||
| b. | assess the respondent institution’s anti-money laundering controls; | |||
| c. | obtain approval from senior management before establishing new correspondent relationships; and | |||
| d. | clearly understand the respective anti-money laundering responsibilities of each institution. | |||
| e. | Reach satisfactory convention that a respondent financial institution does not allow the use of its account by shell banks. | |||
9/2
Where a financial institution registered and licensed in the Kingdom enters into a correspondent relationship in order to receive services from a foreign correspondent financial institution, confidentially requirements under Saudi law shall not preclude the financial institution from providing to the foreign institution the information and documents required for the foreign institution to satisfy itself that the conditions under 9/1 (a) and (b) are met.