KYC (Statutory Verification)

26.02.2019

Updated: 2024-01-12 07:44:21

Introduction

The Approach to this and all Articles is consistent with our Standard System and Procedure.
The undermentioned article gives an overview of the above formalities and in particular
anti money laundering checks and due diligence that need to be carried out.
Our process is very straight forward and is done online within a matter of minutes.
Please complete the form above and read the article below.
Click here to view full details on Anti Money Laundering Regulations.

We are required, Legally and Professionally to carry out certain due diligence including Money Laundering Clearance checks for all clients, prior to any discussions leading to an engagement.
You can see the current legislation to the Money Laundering Regulations 2007 here.
The government has published draft Money Laundering Regulations 2017 (MLR 2017), due to come into force in June 2017. They implement the EU’s 4th Directive on Money Laundering.
In doing so, they will replace the Money Laundering Regulations 2007 currently in force (MLR 2007).
Due Diligence measures are designed to check that clients are who they say they are.

Due diligence measures must be applied in the following instances:
when a business relationship is established.
when an ‘occasional transaction’ worth €15,000 or more is carried out.
where there is suspicion of money laundering or terrorist financing.
when there are doubts about a customer’s identification information that were obtained previously.
when it’s necessary for existing customers – for example if their circumstances change.

In most cases a simple ID check will suffice, however, enhanced checks must be carried out in the following cases:
when the customer isn’t physically present when you carry out identification checks.
when you enter into a business relationship with a ‘politically exposed person’.
- typically, a politically exposed person is an overseas member of parliament.
- a head of state or government or a government minister. (please note that a UK politician isn’t a politically exposed person)
any other situation where there’s a higher risk of money laundering.
Enhanced checks will require the following measures:
obtaining further information to establish the customer’s identity.
applying extra measures to check documents supplied by a credit or financial institution.
making sure that the first payment is made from an account that was opened with a credit institution in the customer’s name.
finding out where funds have come from and what the purpose of the transaction is. (in high risk situations only)

You will need to provide the information on the form in order for the team to complete these checks.
In addition, we will need copies of your passport or drivers licence as well as two other types of verification such as a utility, council tax or telephone bill, dated within the past three months.
Money laundering today is defined much more broadly by POCA (The Proceeds of Crime Act 2002) as “possessing or in any way dealing with or concealing the proceeds of any crime” .
In addition, it is defined as any act that breaks the law from which the person receives any benefits (including financial).

Proceeds of Crime covers a large area but the main examples of this are:
- Fraud.
- Theft.
- Drug Trafficking.
- Any financial benefits obtained through illegal means.
Under the POCA,, it is recognised that offenders should not be able to benefit from their criminal conduct, so the courts have the power to confiscate any benefit that a defendant may have received from their crime.

Chartered and certified accountants are regulated for Anti-Money Laundering by ICAEW and ACCA.
Unqualified accountants, whether in practice or in industry, are required to get clearance from HM Revenue & Customs (HMRC).
The regulators will check compliance with all aspects of MLR (The Money Laundering Regulations).

We carry out all checks electronically online.
These checks leave a trace on the client’s credit history but does not affect the credit rating.
No checks are carried out without first obtaining your consent either verbally or in writing.
We will send you an online form for completion and this is where you can provide the necessary supporting documentation such as passport or drivers licence.
Once we have all the relevant information, we can carry out the ID check.
We may also request additional information in instances where extended due diligence is required.
The Client sign up process can then begin.

There is also an offence known as ‘tipping off’ under the Act.
This is what would happen if a person in the regulated sector were to reveal that a suspicious activity report had been made, say for example about a customer, to that customer.
Where this disclosure would be likely to prejudice any investigation by the authorities, an offence may be committed.
A tipping off offence may also be committed where a person in the regulated sector, discloses that an investigation into allegations a money laundering offence has been committed is either being contemplated or carried out. It is also an offence in the likely event that this disclosure would cause prejudice to that investigation.