The Federal Board of Revenue (FBR) has decided to regulate and monitor business activities of the jewelers, accountants, and real estate agents and directed them to register with the FBR and maintain records of their customers to check money laundering transactions.
The FBR has issued Anti Money Laundering and Countering Financing of Terrorism Regulations for the Designated Non-Financial Businesses and Professions (DNFBPs) 2020.
The government on Tuesday declared FBR as the AMU/CFT Regulatory Authority” for regulating jewelers, accountants and real estate agents. The Real Estate Agent” includes builders, real estate developers and property brokers and dealers when execute a purchase and sale of real property, participate in a real estate transaction capacity and are exercising professional transactional activity for undertaking real property transfer.
Every DNFBP shall be registered with the Board. The DNFBP shall provide any information or documentation that may be required by the Board for the purposes of registration or keeping the DNFBP registration up to date, including but not limited to criminal records of the senior management and beneficial owners.
The real estate agents, jewelers and accountants shall conduct Customer Due Diligence (CDD) in the circumstances and matters set out in section 7A(1) of the AML Act when they engage in the following activities;
Real Estate Agents- When they are involved in transactions for a client concerning the buying and selling of real estate; Jewelers and Dealers in precious metals and stones when they engage in any cash transaction with a customer or client equal to or above Rs. 2 Million; and accountants when they prepare for, or carry out, transactions for their clients concerning the activities described in section 2(xii)(c) and (d) of the AML Act.
The DNFBP shall identify the customer whether entering into a business relationship or conducting an occasional transaction and whether natural or legal person or legal arrangement and verify that customers identity using reliable, independent sources documents, data or information as required under these regulations.
The DNFBP shall identify the beneficial owner and take reasonable measures to verify the identity of the beneficial owner by using a reliable and independent document, data or sources of information.
The DNFBPs shall take appropriate steps in accordance with section 7F of the AML Act to identify, assess, and understand their risks for customers, countries or geographic areas, and products, services, transactions or delivery channels.
The DNFBPs shall have policies, controls and procedures, which are approved by senior management, to enable them to manage and mitigate risks that have been identified in its own risk assessment and any other risk assessment publicly available or provided by FBR; monitor the implementation of those controls and to enhance them if necessary; and take enhanced measures to manage and mitigate the risks where higher risks are identified.
The DNFBP may take simplified measures to manage and mitigate risks if lower risks have been identified. Simplified measures shall not be permitted whenever there is a suspicion of ML/TF.
About the record-keeping, the records maintained by DNFBPs as set out in section 7C of the AML Act shall be sufficient to permit reconstruction of individual transactions including the nature and date of the transaction, the type and amount of currency involved and the customer involved in the transaction so as to provide, when necessary, evidence for the prosecution of criminal activity.
The Real Estate Agents, Jewelers and Accountants shall keep a list of all such customers where the business transaction was refused or needed to be closed either on account of the failure of the customer to provide the relevant documents or the original document for viewing as required.
The record to be maintained and furnished by the Accountants, Real Estate Agents and Jewelers under these rules and as required by AML Act shall be subject to inspection by FBR, as laid down in section 6A(2)(f) of AML Act, who may be assisted by other law enforcement agencies.
Any violation of any provision of these regulations shall be subject to sanctions issued under the AML Act, FBR added