Commonwealth Consolidated Acts

ANTI-MONEY LAUNDERING AND COUNTER-TERRORISM FINANCING ACT 2006 - SECT 96

Entry

  (1)   A financial institution (the first institution ) must not enter into a correspondent banking relationship with another financial institution that will involve a vostro account unless:

  (a)   the first institution carries out a due diligence assessment in accordance with the AML/CTF Rules and prepares a written record of the assessment; and

  (b)   a senior officer of the first institution approves the entering into of that relationship, having regard to such matters (if any) as are specified in the AML/CTF Rules.

Note:   For geographical links, see section   100.

  (2)   If a financial institution (the first institution ) enters into a correspondent banking relationship with another financial institution that involves a vostro account, the first institution must, within 20 business days after the day of entering into the relationship, prepare a written record that sets out:

  (a)   its responsibilities under that relationship; and

  (b)   the responsibilities of the other financial institution under that relationship.

Ongoing assessments

  (3)   If a financial institution (the first institution ) is in a correspondent banking relationship with another financial institution that involves a vostro account, the first institution must:

  (a)   carry out due diligence assessments in accordance with the AML/CTF Rules; and

  (b)   carry out those assessments at the times worked out in accordance with the AML/CTF Rules; and

  (c)   in relation to each assessment, prepare a written record of the assessment within 10 business days after the day of completing the assessment; and

  (d)   in relation to each assessment, ensure that, within 20 business days after the preparation of the written record, a senior officer of the first institution reviews the written record and makes a decision about whether the first institution should remain in a correspondent banking relationship with the other financial institution.

Note:   For geographical links, see section   100.

Civil penalty

  (4)   Subsections   (1), (2) and (3) are civil penalty provisions.