According to the agency, shell accounts (opened in one person's name but typically used by others to conceal the true origin of the funds) and cold accounts (opened illegally and without the owner's knowledge) will also be closed.
Banks will also be required to report the situation to the Central Bank (BC), allowing information to be shared between financial institutions.
The goal is to strengthen the banking sector's commitment to organized crime and prevent the use of accounts for any illicit activity.
According to Febraban president Isaac Sidney, the action is a "milestone" in the process of correcting banks' "toxic" relationships with customers who rent or sell their accounts and use the financial system to "dislodge funds from scams, fraud, and cyberattacks, as well as to launder dirty criminal proceeds."
"Banks cannot, under any circumstances, allow the opening and maintenance of shell accounts, cold accounts, and illegal betting accounts, and that is why we are establishing mandatory procedures for all banks to discipline the sector and curb this type of crime," said Sidney.
Banks' obligations under the new rules:
* Strict policies and specific criteria for verifying fraudulent accounts ("shell" and "cold") and accounts used for illegal betting;
* Refusal of transactions and immediate closure of illicit accounts, with notification to the account holder;
* Mandatory reporting to the Central Bank, allowing information to be shared between financial institutions;
* Monitoring and supervision of the process by Febraban's Self-Regulation Department, which may request, at any time, evidence of reporting and closure of illicit accounts;
* Active participation of the banks' fraud prevention, money laundering, legal, and ombudsman departments, which also participated in the development of the new rules;
* In the event of noncompliance, penalties will be imposed, ranging from prompt conduct adjustments and warnings to exclusion from the Self-Regulation system.
According to Febraban, institutions must maintain internal policies for identifying and closing suspicious accounts and submit a declaration of compliance to the federation's Self-Regulation Board, which must be prepared by an independent department, internal audit, compliance, or the internal controls department.
Source: GMB
