Objective:Today, the crime of money laundering and terrorism financing are considered as one of the difficulties and at the same time the most hidden kinds of crime which is targeting the economy and subsequently the society. This is why countries and international societies are determined to confront with the destructive impacts and consequences of this phenomenon due to its international and organized nature in the current circumstances.Compiling international standards, providing legal infrastructures (rules and regulations) and identifying methods to confront with this problem has caused the jurisdiction of countries to be decisive in ratifying rules and regulations in line with international authorities and exercising them in order to prevent these types of crimes in financial and credit institutions or to present the criminal to judicial authorities in case of occurrence.By ratifying the act of AML and its executive by-laws, the Islamic Republic of Iran is also among countries which are determined to confront with this disapproved phenomenon and considered money laundering as a crime in line with other countries and thus combined and ratified the required rules and regulations subsequent to its approval by competent authorities.Accordingly in order to prevent the commitment of such crimes, Anti-Money Laundering & Combating Financing of Terrorism policies of Refah K. Bank have been ratified and herewith presented while considering the law of AML number 258/183497 dated 13/02/2008 approved by Islamic Consultative Assembly and the law of CFT number 15/90661 dated 12/03/2016 approved by Islamic Consultative Assembly while binding to the latest guidelines of FATF, Basel principles of Bank for International Settlement (BIS) and the Wolfsberg group.

 AML and CFT policies of Refah Kargaran Bank are as follows:

1) Complying with AML Act

Upon ratifying and advising AML and CFT policies to the banking system, all financial and credit institutions are obliged to execute the laws, bylaws and instructions approved by the supreme committee of AML. Accordingly, Refah Kargaran Bank has adopted a new approach in order to meet these laws and execute the approved instructions:

1.      The instruction of the manner of identifying Iranian customers and credit institutions in 37 articles and 18 notes,

2.      Instruction of the method of reporting cash transactions above the designated threshold amount in 11 articles and 2 notes,

3.      Instruction of identifying suspicious transactions and the method of reporting in 15 articles and 4 notes,

4.      Instruction of identifying the level of the customer’s expected activity in 10 articles and 4 notes,

5.      Instruction of observing AML laws in Electronic Payment Systems in 21 articles and 3 notes,

6.      Instruction of observing AML laws in establishing correspondent banking relations and identifying shell banks in 6 articles and 4 notes,

7.      Instruction of observing suspicious individuals in credit institutions in 8 articles and 1 note,


8.      Instruction of the manner of sending documents and papers of the customers of credit institutes to their postal address in 12 articles and 6 notes,

9.      Instruction of measures and strategies for assuring the observation of AML rules in off shore regions in 44 articles and 1 note,

10. Instruction of the manner of keeping commercial deeds and documents based on the ratifications posed by Credit & Monetary Council on 14/06/2010 in 12 articles and 11 notes.

11. Instruction of the manner of supervising the act of extending base services to PEPs in credit institutions in 12 articles and 6 notes

12. Instruction of the manner of identifying foreign customers of credit institutions in 22 articles and 14 notes

13. Instruction of the AML rules in foreign exchange companies in 20 articles and 14 notes

By executing the aforesaid policies, Refah Kargaran Bank is obliged to act in line with AML and CFT ratified laws and to observe country’s rules and regulations and the international recommendations and standards.

2) Policies:

The activities of Refah Kargaran Bank regarding AML and CFT laws are compiled and prepared according to country’s rules and regulations and instructions conveyed by the Central Bank of Iran (C.B.I) as the regulator and supervisor of financial institutions and in line with FATF recommendations.Policies of Refah Bank regarding AML is as follows:

1- Identifying the customer based on valid evidences while complying with related organizations,

2- Constant supervision on accounts exposed to higher risk,


3- Not opening accounts for individuals who are not permitted to do so,


4- Not establishing any correspondent banking relations with shell banks,


5- Constant control on suspicious individuals and the black lists’ entities,


6- Giving report on cash transactions above the designated threshold amount as well as the suspicious transactions to FIU,


7- Holding general training courses for all the staff and holding on-the-job training courses for staff in special departments while keeping

the staff’s training records,

8- Internal controlling based on AML and CFT policies,

9- Maintaining and keeping customers’ information while avoiding from disclosure and non-permitted use of them,


10- Not performing any financial electronic transaction which is without name or not traceable ,


11- Obtaining commitment when extending base services to non-financial services regarding AML rules and regulations,


12- Paying attention and being careful about the institutions whose names are among terrorist crimes lists or involved in money laundering acts,


13- Obtaining written commitment from customers who have applied for receiving basic services regarding AML rules and regulations,


14- Designing a suitable place in the bank’s existing forms and also in all the bank’s software for inserting one of the valid identity


15- Making required decisions for suitable keeping and processing of information,


16- Assigning a person in each branch for justifying customers regarding the necessity of giving report about cash crediting to accounts,


17- Issuing any kinds of identifying devices after full identification of the customer and performing complying registration of identity

specifications with identification devi
3) Policies of accepting customers:

Implementing KYC policies in Refah Kargaran Bank are practiced according to the instructions and circulars of Central Bank of Iran and thus the personnel of the bank are obliged to make necessary measures for updating and completing the information and document related to previous customers according to article 15 of the executive bylaw ratified by the Board of Ministries regarding the classification of former customers.In case customers are not cooperating in presenting their identity documents or when trying to give misinformation, the staffs in related branches refuse to extend any kinds of banking services to such customers.Meanwhile according to article 8 of the instruction of “The manner of identifying Iranian credit institutions” ratified by the Supreme Council of AML, those customers whose identity information discrepancies are found- after being informed by the bank to present documents and to complete required information- are bound to resolve the mentioned discrepancies and if the customers refrain from doing the same, the staff will prevent the customers and stop extending any basic services to them in such manner.


4) Know Your Customer strategies:

By implementing the AML/CFT instructions (including the instruction of identifying Iranian customers of credit institutions and the instruction of identifying foreign     customers which are ratified by the supreme committee of the country’s AML council) identifying customers in Refah Kargaran Bank will be possible according to complying the tools’ specifications received from the customer with his/her valid ID documents and after his identity identification through contacting competent organizations. (National organization for Civil Registration and Company Registration General Office) According to the instruction notified by the supreme committee of AML, banking services in Refah Bank is divided into two types of “basic services” and “non-basic services”. Basic services means banking and credit services which, according to regulations are considered to be pre-requisite and required for providing other services by the bank after which customers call on the bank to receive frequent and continuous services. Basic services include:

Opening different kinds of accounts

Allocating credit facilities, leasing operations,…

Non-basic services are the banking and credit services which are not preliminary for extending other kinds of services and after which customer may not call on the bank to receive frequent and continuous services:

Non basic services include:

     Receiving and paying funds

The process of identifying customers (including individuals or legal entities)in Refah Kargaran Bank are divided into two levels of initial or full identification according to the type of banking services:

1.      Initial identification: means checking against identification documents and entry of information declared by customer. The staffs in related branches are obliged to perform initial identification while extending non-basic services to customers.


2.      Full identification: means precise identification of customer at the time of

providing basic services. This type of identification includes: job status, type of activities, level of income, education, precise living address, precise working place address, expectations from the customers’ level of transactions and etc. Meanwhile, the staffs in branches make measures regarding full identification of customers when extending basic services.

5)   Suspicious Transactions Report (STR)

All personnel of the bank in all departments and branches are obliged, in case they notice suspicious transactions and activities on AML or CFT acts to report the matter according to AML law and its executive bylaw and also CFT law in Islamic Republic of Iran as well as the instruction on suspicious transactions identification.

These reports are sent to the AML department confidentially in order to get further specialized investigations. Subsequently in case suspicious transactions are identified, the issue will be reported to FIU and AML unit.

Refah Kargaran Bank’s AML software has been implemented according to circular number 91/161337 dated 13/09/2012 of Central Bank of Iran and monitors and controls suspicious transactions of the Bank’s customers. AML department, while supervising and monitoring the suspicious transactions of accounts, takes the following actions:

Investigating the reports received from branches as well as the outcomes of the AML software reports,

Controlling suspicious individuals,


Performing periodic inspections in off-side and on-side manner in order to control the method of implementing AML and CFT laws.

6) Reporting cash transactions above the designated threshold amount

Personnel in Refah Kargaran Bank’s branches are obliged to record all transactions above the designated threshold which customers have paid in cash and report the matter to the Anti-Money Laundering Department of the Central Bank of Iran as per the instruction on “Reporting Cash Transactions above the Designated Threshold amount”. Subsequently the related AML department dispatches the said report to FIU of the Islamic Republic of Iran.

7) Risk approach in AML

After passing the complete KYC procedures, Refah Kargaran Bank has to establish business relationship with customers through holding training courses for the bank’s personnel , implementing customers’ effective KYC measures and obtaining information regarding the purpose of establishing relationship with Refah Kargaran Bank, the main types of activities, financial status, customers’ background, types of services, domicile,etc.

It must be noted that according to article 11 of the instruction of “The manner of identifying Iranian credit institutions”, the personnel of the bank are exempted from extending any kind of basic services to the following entities:

       - Individuals who refrain from presenting information or required documents,

  -  Unauthorized exchange companies,

  Individuals who are not permitted to open accounts due to judicial authorities’ decision ,

  - Iranian individuals without ID or national number .

  It is reiterated that the following entities are categorized as the bank’s high risk customers:

       Charity oriented organizations, investment and retirement Funds,

  Exchange companies and non-financial occupations,

              Applicants to open pooled accounts,

      Non present and non-resident customers ,

      PEPs (Politically Exposed People), their family members and close associates.

8)   Correspondent Banking Relation:

In order to adopt necessary due diligence strategies in establishing and maintaining correspondent banking relations, Refah Kargaran Bank takes action in establishing correspondent banking relations only after gathering sufficient information regarding the correspondent bank.

The information about the intended correspondent bank includes the following:

·        Structure of ownership, management, shareholders, managers and etc.,

·        Main types of activities and the nature of respondent’s business,

·        The Country of domicile,

·        The internal policies and instructions of the respondent institution’s regarding AML and CFT,

·        The purpose of opening correspondent account,

·        The regulatory and supervisory status and the banking laws of the respondent bank’s country,

·        Due diligence activities regarding extending services which lead to maintaining or transferring funds related to money laundering or terrorism financing acts,

·        Not entering into a correspondent banking relationship with shell banks,

·        Assuring the respondent bank’s non-existence in high risk regions regarding money laundering ,

·        Obtaining approval from senior management prior to establishing new correspondent relationships,

·        Investigating the status of PEP (politically exposed person) in the structure of managers, shareholders and other affiliates of the related bank,

·        The manner of identifying, controlling and extending services to political authorities as the respondent bank’s customers,

·        The manner of controlling and monitoring suspicious transactions and activities in the respondent bank,

·        Investigating the bank’s status regarding probable previous sanctions in recent years,

·        Policies of the respondent bank in account opening and extending services to high risk customers and accounts,

·        The manner of controlling people who are under pursuit of international and regional sanctions,

·        The quality of the rules and regulations of the respondent bank’s country regarding cooperation with correspondent banks for presenting further information if case of need.

9)   Record keeping

Refah Kargaran Bank maintains all necessary records on transactions, customers’ accounts and all records and documents which have been received for KYC purposes for at least five years after the termination of an occasional particular transaction.

10) Training Schedule  

Refah Kargaran Bank makes necessary arrangements in holding pre and on-the-job training courses for its employees at all levels. These courses are held with the purpose of familiarizing the Bank’s personnel with the Act, the bylaws and relative instructions and in particular money launderers’ manner of operation and their latest intrigues of committing crimes regarding using people involved in money laundering and the method of eliminating the criminal origin of funds.

In this connection all the staffs of the Bank have passed necessary training courses regarding KYC methods, security checks of identity documents (national ID card, identity number and Iranian and foreign passport) as well as the methods for complying information with related organizations such as National Organization for Civil Registration and Company Registration General Office.