Jordan, July 1, 2018
CBJ amends anti-money laundering and terrorism financing regulations

The Central Bank of Jordan (CBJ) on Saturday released an amended set of anti-money laundering and counter terrorism financing (AML/CFT) regulations applicable on licensed banks, after they were endorsed by the National Committee for Anti-Money Laundering and Terrorism Funding.

In a statement issued on Saturday, the bank said the new regulations were in response to the amendments recommended by the Financial Action Task Force for 2012, and to the developments in domestic and international markets and to support and strengthen the AML/CFT framework in the Kingdom.

One of the most important amendments introduced by the new regulations is to frame and enhance the risk-based approach, whereas banks are required to carry out a comprehensive AML/CFT assessment on an annual basis in accordance with a methodology through which AML/CFT risks pertaining to customers, countries, geographic regions, products, services, processes and service delivery channels, are identified and assessed. The CBJ said noted that this move will make the scope and strength of the risk management function commensurate with the nature, size and complexity of any bank's operations and activities and with money laundering and terrorist financing risks.

The new regulations demand the development of policies, controls and procedures to manage and reduce the risks of money laundering and terrorist financing and to take due diligence measures consistent with the degree of the risk identified.

They also detail the procedures required to verify and identify the customers whether they are natural or legal persons and the timing of such verification. The regulations require banks to identify the real beneficiary and take reasonable procedures to verify this identity according to the nature of the customer's risks.

The regulations demand banks to establish a risk system to determine which of its customers or real beneficiaries falls within the category of high-risk political persons, be they foreign or nationals.

Furthermore, the regulations detail banks' obligations when conducting money transfers, whether the bank is the source or the recipient or the intermediary.

According to the new regulations, banks are now required to develop continuous training plans and programs on AML/CFT for all employees.

They also prohibit conducting commercial transactions on the accounts of natural persons and the issuance of prepaid cards to non-bank customers to control any risk that may arise from this process.

The Central Bank said in its statement that these regulations came into force on June 26, 2018.