VZCZCXYZ0010
RR RUEHWEB

DE RUEHAM #2317/01 2181444
ZNR UUUUU ZZH
R 051444Z AUG 08
FM AMEMBASSY AMMAN
TO RUEHC/SECSTATE WASHDC 3264
INFO RUEATRS/DEPT OF TREASURY WASHDC
RUEHGB/AMEMBASSY BAGHDAD 6037
RUEHLB/AMEMBASSY BEIRUT 2887
RUEHEG/AMEMBASSY CAIRO 3741
RUEHDM/AMEMBASSY DAMASCUS 3941
RUEHRH/AMEMBASSY RIYADH 1993
RUEHTV/AMEMBASSY TEL AVIV 1278
RUEHJM/AMCONSUL JERUSALEM 5113

UNCLAS AMMAN 002317 
 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/ELA AND EEB 
TREASURY FOR OTA 
PLEASE PASS TO U.S. SEC 
 
E.O. 12958:  N/A 
TAGS: EFIN ECON KCRM SNAR JO
SUBJECT: Jordan Securities Commission Adopts AML Regulations 
 
¶1. (U) Summary: The Jordan Securities Commission Board of 
Commissioners issued anti-money laundering (AML) regulations for 
securities activities on June 23.  The regulations went into effect 
on July 31, following their publication in the Official Gazette. 
The regulations are consistent with both the recommendations of the 
Financial Action Task Force and the requirements of Jordan's AML Law 
No. 46 for 2007, and are noteworthy because they define obligated 
entities falling under the regulatory purview of the Commission; 
establish requirements for creating effective internal AML programs; 
establish record keeping requirements; and require specific due 
diligence procedures for dealing with high risk customers including 
politically exposed persons.  Post facilitated technical assistance 
to ensure that the new regulations are consistent with international 
standards.  End summary. 
 
New Regulations Emphasize Customer Identification 
--------------------------------------------- ---- 
 
¶2. (U) The Jordan Securities Commission (JSC) Board of Commissioners 
issued anti-money laundering (AML) regulations for securities 
activities on June 23; the regulations took effect July 31 upon 
publication in Jordan's Official Gazette.  The new regulations are 
consistent with the recommendations of the Financial Action Task 
Force and Jordan's AML Law No. 46 for 2007.  The most important 
issue covered by these regulations is the need for obligated 
entities under the regulatory supervision of the JSC to exercise due 
diligence measures, including verifying a customer's identity and 
activities, and also confirming the true beneficial owner of 
securities prior to entering into a financial relationship.  The 
regulations also prohibit dealing with unidentified customers or 
those who have fictitious names, and mandate constant updating of 
customer identification.  In addition, the regulations establish 
procedures for identifying and verifying the identity of natural and 
legal persons in accordance with FATF Recommendation V. 
 
¶3. (U) The regulations further specify conditions that require 
increased customer due diligence, such as dealing with high risk 
customers (defined as politically exposed persons - PEP - including 
their families), citizens of countries that have insufficient AML 
legislation, customers who pose risks associated with 
non-face-to-face transactions, and charitable organizations. 
 
New Requirements for Financial Service Providers 
--------------------------------------------- --- 
 
¶4. (U) The regulations define obligated entities as:  financial 
services companies, custodians, shared investment companies, and 
shared investment funds.  Each obligated entity must assign an 
advice officer (compliance officer) and specify the officer's 
qualifications and duties, as well as the procedures to be followed 
in reporting suspicious activity.  The obligated entity must create 
AML policies, procedures, and internal controls to identify 
suspicious activity and present the entities AML plan to the JSC. 
All records and documents must be kept for five years after the end 
of the relationship between a customer and the obligated entity or 
after the date of the last transaction carried out by the customer. 
 
¶5. (U) Even though obligated entities have six months from the date 
of implementation to comply with the new regulations, requirements 
for reporting suspicious activity to the AMLU have been in place 
since July 17, 2007, when the Anti Money Laundering Law went into 
effect.  The regulations mandate that reporting requirements are to 
be initiated immediately. 
 
¶6.  (SBU) Comment:  Issuance of the regulations represents a 
positive step forward for Jordan's regulatory environment for 
financial crimes.  It also highlights strong, bilateral cooperation, 
resulting from U.S. Treasury Office of Technical Assistance (OTA) 
engagement with the JSC since 2006.  The JSC has been a strong 
proponent of the AML Law and the AMLU.  In February 2008, an OTA 
Enforcement Team intermittent advisor assisted the JSC by reviewing 
the draft regulations and advising how to make them conform to 
international standards.  The OTA advisor worked with the OTA 
Resident Enforcement Advisor and the AMLU in training members of the 
JSC in recognizing risks in the securities sector and red flag 
indicators of suspicious activity related to money laundering and 
terrorist financing.  The lack of comprehensive legislation 
addressing terrorist financing, however, remains a gap in GOJ 
efforts to impede money laundering and terrorist financing on which 
Post and key GoJ partners are focused. 
 
Visit Amman's Classified Website at 
http://www.state.sgov.gov/p/nea/amman 
 
RUBINSTEIN