{"id":252424,"date":"2024-12-18T23:27:07","date_gmt":"2024-12-18T21:27:07","guid":{"rendered":"https:\/\/sada.ly\/en\/?p=252424"},"modified":"2024-12-19T23:43:17","modified_gmt":"2024-12-19T21:43:17","slug":"al-shaeibi-explains-the-importance-and-implications-of-the-federal-reserves-alert-to-the-central-bank-regarding-dollar-denominated-transactions","status":"publish","type":"post","link":"https:\/\/sada.ly\/en\/al-shaeibi-explains-the-importance-and-implications-of-the-federal-reserves-alert-to-the-central-bank-regarding-dollar-denominated-transactions\/","title":{"rendered":"Al-Shaeibi Explains the Importance and Implications of the Federal Reserve’s Alert to the Central Bank Regarding Dollar-Denominated Transactions"},"content":{"rendered":"\n

Banking expert Omran Al-Shaeibi commented on the letter sent by the Central Bank of Libya to the Audit Bureau in response to the alert issued by the U.S. Federal Reserve, which called for subjecting its dollar-denominated transactions to review and auditing. He described this alert as a significant indicator of the nature of the relationship between the Libyan banking sector and international financial institutions. Al-Shaibi stressed the need for serious action, as this measure falls under the \u201cde-risking\u201d policy, whereby financial institutions end or restrict business relationships with certain clients or client groups to avoid risks, instead of managing them in line with the Financial Action Task Force (FATF)’s risk-based approach.<\/p>\n\n\n\n

Al-Shaeibi explained the importance and implications of this measure as follows:<\/p>\n\n\n\n

    \n
  1. Loss of Institutional Trust<\/strong>: This measure reflects deep concerns from the U.S. Federal Reserve about the Central Bank of Libya\u2019s ability to manage its financial operations according to international standards. This impacts the bank\u2019s reputation and reduces international dealings.<\/li>\n\n\n\n
  2. Complicated Financial Operations<\/strong>: This involves subjecting international financial transactions to meticulous reviews or involving a third party in auditing processes, as indicated in the alert. Such actions could disrupt vital financial operations, such as collecting oil revenues or facilitating essential imports.<\/li>\n\n\n\n
  3. Direct Economic Repercussions<\/strong>: Restrictions on dollar-denominated transactions may delay the country\u2019s ability to meet external obligations, negatively affecting national economic stability and hindering the state’s ability to provide basic goods or maintain monetary stability.<\/li>\n<\/ol>\n\n\n\n

    He added that the implementation of the \u201cde-risking\u201d policy by international financial institutions, as per the FATF, is not solely tied to risks of money laundering and terrorism financing. It also reflects a comprehensive assessment of the institution’s adherence to the 40 international standards set by the FATF. This approach is based on internal risk assessments without requiring formal justification.<\/p>\n\n\n\n

    Al-Shaeibi emphasized the need for the Central Bank to enhance its procedures and demonstrate its ability to comply with international standards to restore correspondent institutions’ trust. This includes:<\/p>\n\n\n\n

      \n
    • Preventing delays in international financial transactions.<\/li>\n\n\n\n
    • Avoiding disruptions in financial flows with the global market.<\/li>\n\n\n\n
    • Strengthening measures against money laundering and terrorism financing.<\/li>\n\n\n\n
    • Developing a robust \u201cKnow Your Customer\u201d system.<\/li>\n\n\n\n
    • Increasing transparency in managing financial operations.<\/li>\n\n\n\n
    • Engaging reputable third-party financial institutions to manage risks.<\/li>\n\n\n\n
    • Seeking advisory support from international financial institutions to enhance compliance standards.<\/li>\n\n\n\n
    • Working on a long-term strategy for sustained improvements.<\/li>\n<\/ul>\n\n\n\n

      He concluded by stating: “The recent uncalculated breach of the Central Bank has led international institutions to take stringent measures until trust in Libya’s financial institutions is restored. However, we trust the new board of directors and technical teams at the Central Bank to overcome this obstacle successfully.”<\/p>\n","protected":false},"excerpt":{"rendered":"

      Banking expert Omran Al-Shaeibi commented on the letter sent by the Central Bank of Libya to the Audit Bureau in response to the alert issued by the U.S. Federal Reserve, which called for subjecting its dollar-denominated transactions to review and auditing. He described this alert as a significant indicator of the nature of the relationship […]<\/p>\n","protected":false},"author":13,"featured_media":252425,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[2],"tags":[628,755,613,687],"class_list":["post-252424","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-central-bank","tag-federal-reserve","tag-libya","tag-transactions"],"acf":[],"_links":{"self":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts\/252424","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/comments?post=252424"}],"version-history":[{"count":2,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts\/252424\/revisions"}],"predecessor-version":[{"id":252427,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts\/252424\/revisions\/252427"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/media\/252425"}],"wp:attachment":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/media?parent=252424"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/categories?post=252424"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/tags?post=252424"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}