The Financial Intelligence Centre (FIC) has published a document that provides accountable institutions with guidance on how to comply with the provisions in the Financial Intelligence Centre Act (Fica) aimed at combating proliferation financing.
The Financial Action Task Force defines proliferation financing as the provision of funds or financial services used for the manufacture, acquisition, possession, development, export, trans-shipment, brokering, transport, transfer, stockpiling or use of nuclear, chemical or biological weapons and their means of delivery and related materials in contravention of national laws or, where applicable, international obligations.
Public Compliance Communication (PCC) 54 provides accountable institutions with guidance on their targeted financial sanctions obligations in terms of Fica and makes recommendations regarding the adoption of a risk-based approach to mitigate the risk of financing weapons of mass destruction (WMDs).
This section of the PCC discusses:
- What is meant by the financing of WMDs;
- What is meant by targeted financial sanctions measures aimed at combating proliferation financing;
- Scrutinising client information in terms of section 28A of Fica;
- Freezing and prohibiting dealing in funds or other assets of designated persons and entities;
- Terrorist property reports and suspicious and unusual transaction reports;
- Applying a risk-based approach;
- Heightened proliferation financing risks;
- Client risk factors;
- Geographic area risk factors;
- Product risk factors;
- Customer due diligence; and
- De-risking.
In addition, the PCC provides recommendations aimed at mitigating the risk of non-compliance with the broader activity-based sanction obligations that stem from United Nations Security Council resolutions on countering the proliferation of WMDs.
Click here to download PCC 54 “Guidance on compliance measures aimed at combating proliferation financing”.
