Under anti-money laundering (AML) regulations, reporting entities (e.g., credit institutions) are required to be aware of several key watchlists, maintained by relevant Vietnamese authorities, to ensure compliance with their AML obligations. This blog will introduce those watchlists and discuss specific requirements related to them.

Essential watchlists under AML regulations

Under AML regulations, the Vietnamese Government maintains the following watchlists:

(1)             A Blacklist (danh sách đen in Vietnamese): including (a) list of organizations and individuals involved in terrorism and terrorism financing compiled by the Ministry of Public Security (MPS), and (b) a list of organizations and individuals designated as being involved in the proliferation and financing of the proliferation of weapons of mass destruction, compiled by the Ministry of National Defense (MND);

(2)             A warning list/Grey list (danh sách cảnh báo in Vietnamese): A list of organizations and individuals compiled by the State Bank of Vietnam (SBV) to warn about those with a high risk of money laundering; and

(3)             A list of Foreign politically exposed person (PEP List) (danh sách cá nhân nước ngoài có ảnh hưởng chính trị in Vietnamese): A list of foreigners who hold a senior position in foreign agencies, organizations, and international organizations, notified by the SBV.

There are no specific guidelines on how to access these watchlists or the procedure for screening data against them. However, except for the Grey List, which has not yet been published by the SBV, the Blacklist ((1)(a) and (1)(b)) and PEP List can be found via the national portals of the MPS, MND, and SBV (see embedded links).

Relevant requirements related to watchlists

Under AML regulations, transactions involving individuals or entities listed on the Blacklist, Grey List, or PEP List are considered high-risk for money laundering, requiring enhanced AML measures. Specifically, reporting entities have the following obligations.

Regarding Blacklist, reporting entities must report to the counter-terrorism forces of the SBV and the MPS, and apply provisional measures (e.g., delaying transaction) if there are grounds to suspect or discover that any parties to the transaction are listed on the Blacklist. Grounds for suspicion or detection include:

• The individual or entity involved in the transaction has information that fully matches the details of a person or entity on the Blacklist;

• The individual involved in the transaction has certain groups of information matched with a person on the Blacklist, or the entity involved in the transaction has certain information matched with an entity on the Blacklist, and based on the collected information, the individual or entity is believed to be linked to terrorism, terrorist financing, proliferation, or the financing of the proliferation of weapons of mass destruction.

Regarding PEP List, reporting entities must, among others, implement an appropriate risk management system for identifying customers or beneficial owners who are persons on the PEP List;  obtain its senior management approval before establishing business relationship with persons on the PEP List; verify the origin of their and their related persons’ assets, and monitor business relationship with such persons; and closely monitor business relationship with life insurance holder of which the beneficiary or beneficial owner of the beneficiary is a person on the PEP List and report the transaction as suspicious if necessary.

Regarding Grey List, reporting entities must apply enhanced measures to monitor transactions involving individuals or organizations on the Grey List, including collecting, updating, and verifying enhanced customer identification information, and closely monitoring the customer's transactions, checking information and purpose of the transaction. If there is suspicion, the reporting entities must consider, analyze, and report the transaction as suspicious and may also reject such transactions.

This post is written by Trinh Phuong Thao and Nguyen Hoang Duy and reviewed by Nguyen Quang Vu.