BI summons 17 forex traders over KYC case<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
The central bank, as part of efforts to stop speculation and
\nmoney laundering in the foreign exchange market, has summoned 17
\nnonbank forex traders that have failed to implement the global
\nbest practice of \"knowing your customer\" (KYC).<\/p>\n
Bank Indonesia said in a statement released on Monday it would
\nrevoke the licenses of the forex traders if they failed to
\nrespond to the summonses within a week's time, and if they did
\nnot immediately comply with the KYC requirements contained in
\ncentral bank Regulation No. 6\/1\/PBI\/2004 on forex traders.<\/p>\n
The regulation, issued on Jan. 6, 2004, requires all forex
\ntraders operating in the country to submit to the central bank
\nstandard procedure and implementation guidelines for KYC within a
\nyear after the implementation of the regulation.<\/p>\n
\"Knowing your customer\" is a principle that basically requires
\nforex traders to keep a record of the identities and transactions
\nof all their customers, as well as to implement risk management
\nguidelines for the transactions.<\/p>\n
The central bank's action comes at a time when the rupiah
\nremains under pressure from speculators who might take advantage
\nof the currency's weakness and the relatively small size of the
\nlocal foreign exchange market, which sees about US$1 billion in
\ndaily trading.<\/p>\n
Bank Indonesia issued an earlier regulation preventing banks
\nfrom receiving offshore dollar loans above $1 million without
\nunderlying transactions, in order to prevent speculative forex
\ntrading.<\/p>\n
Several analysts, however, warned that speculators could
\ncircumvent the regulation by setting up phony investment firms
\nand forex trading companies, and called for the central bank to
\ntake more concrete preventive measures.<\/p>\n
The rupiah ended at Rp 10,180 against the U.S. dollar on
\nMonday, according to Bloomberg, slightly down from Friday's close
\nof Rp 10,155 against the greenback. The rupiah has depreciated by
\nsome 10 percent this year.<\/p>\n
Meanwhile, Bank Indonesia also announced the issuance of new
\nRp 50,000 and Rp 10,000 bills on Oct. 20.<\/p>\n
\"The issuance of the new bills is part of BI's efforts to
\nprovide the public an adequate amount of payment bills that are
\nstandardized in size and security features,\" Bank Indonesia
\ndeputy governor for payment systems Maulana Ibrahim said.<\/p>\n
The 1999-issued Rp 50,000 and 1998-issued Rp 10,000 notes will
\nremain valid for payment.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bi-summons-17-forex-traders-over-kyc-case-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}