The Central Bank of Iran says it will employ smart supervision technology to better supervise banking operations and monitor their compliance with anti-money laundering rules.
In a meeting with bank representatives on Thursday, CBI deputy for supervision, Abouzar Soroush, said a holistic approach, reliable data and information plus efficient oversight systems are the main requirements for the efficient monitoring of banks.
"Two steps have been considered in this regard, which are being pursued in tandem, namely implementation of the data governance system in the CBI and banks and the completion of databases whose information is not in the banking network and must be obtained from ministries and executive boeides," CBI website quoted Soroush as saying.
He emphasized the need for sociocultural development at all levels of the banking sector to fight the scourge of money laundering.
Soroush referred to the key role of anti-money laundering units in the banking industry and reflected on how the CBI had controlled liquidity growth with respect to bank balance sheets.
"This began in the summer of 2022 and its effects were visible in controlling liquidity in the second half of the year." he added without elaboration.
Last year, by revising guidelines and using quantitative and qualitative models and variables, each bank was given a score, which is the criterion for the growth of their balance sheet. If a bank exceeds the assigned growth level, it immediately faces legal procedures such as increase in legal deposits."
If a bank is weak in implementing anti-money laundering rules, it will impede the growth of its balance sheet, which is the main drawback for a bank because it will significantly affect it growth, the official said.
He discussed CBI measures in the field of banking systems, stating that its Unique Beneficiary System helps in the fight against money laundering and identifies illegal operations.
"The central bank will soon share data from this system with banks."
Crucial Area
Regular meetings of bank CEOs anti-money laundering authorities are a welcome platform to take stock of ongoing developments and prepare for the future in the crucial area of fighting dirty money.
Given the need and significance of combating money laundering "we need a holistic approach to address ambiguities, suspicions and questions raised by banks and credit institutions to ensure maximum impact of guidelines."
He highlighted the constructive cooperation between the CBI and the Financial Intelligence Unit (FIU) and called on lenders to do likewise.
Compliance with anti-money laundering rules in credit institutions demands new sociocultural concepts and behavior. "Fortunately, the process within banks has begun with the holding training courses for bank staff to update their skills in fighting money laundering, We hope these courses will be held on a regular basis."
In the next phase, training courses will be held for senior bank managers and board members, which should produce better results by sharing experience and examining the output.
The official stressed the need for raising public awareness on AML concerns and said it demands content production in all areas and their dissemination on media platforms and social media, which requires efficient planning by banks and credit institutions.
“Mass media, including radio/TV networks and banking network PR departments, could be used for information dissemination, sociocultural progress and public awareness regarding banking trends and combating money laundering in areas such as commercial and non-commercial accounts, illegal access to bank accounts and the likes.
Tighter Regulations
In 2020 the CBI announced rules to improve control over banks and their performance. It said the measures, among other things, are to ensure anti-money laundering laws are uphled, curb tax evasion and curtail speculation in the financial markets, namely forex and gold.
Driven by money laundering concerns, the regulator last year barred banks and credit institutions from processing payment requests of customers lacking complete ID information stored in their special data center(s).
Prior to that the CBI set a daily cap for bank transactions for adults. The rule came into effect in 2020 and transactions via inter-bank systems were limited to one billion rials per person per day. Last October it restricted daily transactions for clients under 18 years to a maximum 150 million rials.
As for other measures, the CBI compartmentalized individual and business accounts. It required individual customers to show documentary evidence for transactions above two billion rials at one bank in one day.
In addition, individual customers should state the reason for their transactions over the threshold when filling bank forms. They must also “provide documents to show that the transaction is for a valid business reason, concluding a contract or other acceptable purposes.”
The regulator also set a daily cap of 1 billion rials on transactions via point-of-sale devices and limited the use of POS overseas.
