Russian c-bank seeks to set up information exchange for banks, NFOs

Russian c-bank seeks to set up information exchange for banks, NFOs

- in All News, Regulation
Central Bank of Russia CBR

The Central Bank of Russia (CBR) said on Wednesday it has partnered with Rosfinmonitoring, the Russian federal financial monitoring service, to ensure an information exchangebetween banks and non-bank financial organizations (NFOs) concerning their clients.

The information exchange will be carried out electronically and will come into effect in 2017. Rosfinmonitoring is currently working on a document which regulates information submission to the Bank of Russia. Banks and NFOs regularly send to Rosfinmonitoring information when they deny operations to clients or when they terminate bank deposit agreements.

The CBR will use the information exchange to inform organizations under its supervision in cases when their clients have been denied operations or whenever there is conclusion or termination of bank account agreements (bank deposit agreements).

The idea behind the project is that it is expected to reduce the risk of market participants’ involvement in operations connected with the legalization of criminally obtained incomes and the financing of terrorism. Banks and NFOs can monitor their clients and decide whether to reject them service if they consider them a threat. Under the local regulation,  market participants are obliged to take into account such information when determining the risk of client’s involvement in money laundering, terrorism, or any such operations.

Recently, the Russian central bank also proposed that NFOs should keep their continuity plans and emergency procedures updated at least once a year and have daily backups of information and databases which support key processes. The move aims to ensure a better protection of the financial market participants in case of technical malfunctions and information leaks.

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