October 1, 2020 | Investopaper
Securities Board of Nepal (Sebon) is going to tighten the issue of money laundering in the capital market. For that, the risk-based supervision manual 2077 has been issued regarding asset laundering with effect from Thursday. The board has stated that the manual will make the work related to the prevention of money laundering of securities dealers more regular and systematic.
According to the board, the manual is based on the standards of the Financial Action Task Force (FATF) and the Asia-Pacific Group (APG) in line with international practices on money laundering and the prevention of financial investment in terrorist activities.
After the implementation of the manual, the provisions in the existing law on money laundering and prevention of financial investment in terrorist activities will be more effectively monitored and inspected and the work related to prevention of money laundering will be more regular and systematic.
The board has stated that the manual is based on the risk of the trader and the structural and underlying risk. The risk management of the trader will be done between 1 and 5 rating scale. It also covers issues related to on-site and off-site supervision of securities traders. Provision have been made to assess the off-site risk of securities traders from the quantitative and qualitative data and details collected from the traders.
The board has stated that arrangements have been made in the manual to determine the duration, area and quantity of on-site supervision from off-site risk assessment of the trader. The risk assessment of the securities trader in the manual will be based on the goods and services provided by the trader, customer, geographical area, high ranking person, risk related to distribution medium and structural risk.