On January 4, 2024, the Reserve Bank of India (RBI) issued amendments to the Master Direction on Know Your Customer (MD-KYC). These updates are in accordance with amendments to the Prevention of Money Laundering (PML) Rules, 2005, the Unlawful Activities Prevention Act (UAPA), and the Weapons of Mass Destruction (WMD) Act 2005.

To know more:  https://www.fcctimes.com/2024/01/04/update-on-kyc-master-direction-clarification-and-amendment-regarding-politically-exposed-persons-peps/?utm_source=RZOLUTWebsite&utm_medium=FCCRegUpdate08jan24

Key amendments to the Master Direction (MD) include:

• The removal of the definition of Politically Exposed Persons (PEPs) from sub-clause (xvii) of clause (a) of Section 3, now included in Section 41. The revised definition states:
  “Politically Exposed Persons” (PEPs) are individuals who are or have been entrusted with prominent public functions by a foreign country, including Heads of States/Governments, senior politicians, senior government, judicial, or military officers, senior executives of state-owned corporations, and important political party officials.”
• Mandating that any regulated entity, including banks, must perform Customer Due Diligence (CDD) when conducting business with a PEP.
• Requiring senior management to decide whether to open an account, with branches consistently monitoring such accounts.
• Directing banks to obtain the source of funds from the PEP, along with the accounts of family members and close relatives.