On June 21, 2002 the FATF released its 2001-2002 annual report and its review to identify non-cooperative countries and territories. In the review, the FATF stated that it has removed four countries - Hungary, Israel, Lebanon and St. Kitts and Nevis - from its list of non-cooperative countries and territories (NCCT) in the fight against money laundering. The FATF welcomes the progress made by a number of the 15 jurisdictions remaining on the NCCT list.

The FATF continues to call on its members to advise their financial institutions of changes to the NCCT list and to give special attention to businesses and transactions with persons, including companies and financial institutions operating in NCCTs.

Accordingly, with respect to any business or affairs that may be transacted by financial institutions with persons or entities domiciled in NCCTs, financial institutions, whether directly or through any subsidiary or branch operations, should give special attention by exercising appropriate due diligence and caution in conducting any transactions with such persons or entities. Financial institutions should also take note of the FATF's call to maintain additional counter-measures against Nauru as outlined in OSFI's notice of January 16, 2002.

For the 15 countries and territories remaining on the FATF's NCCT list, readers are encouraged to refer to FATF's Web site for the June 21, 2002 press release announcing the FATF's Annual Report for 2001-2002, and the FATF's latest report on identifying Non-Cooperative Countries and Territories.

Thank you very much for your continued co-operation in this matter.