Do the requirements to carry out ongoing monitoring of customer due diligence measures and client’s business relationships mean that you must obtain a passport and utility bill from your existing clients or that you must investigate all the business affairs of your clients?
For many existing clients which date from 1 March 2004 you will have obtained verification of their identity under the 2003 regulations. For those clients you will need to consider whether the information you hold is sufficient, based on your risk assessment of the client , to demonstrate your have taken appropriate steps to verify the identity of your client and whether anything has changed in the period to render that information out of date. For clients whose situation, address, name and business has not changed since you last considered their identity we would suggest you need do no more than commit your risk assessment and review to the file.
For clients where the situation has changed or who predate 2004 you may well have obtained official verification of matters such as name and address through correspondence with government offices, bank statements and similar official channels. It is suggested that you undertake these checks during the planning for the next engagement for the client.
The key issues are:
- Have you undertaken a risk assessment of the client ?
- Do you have information which supports your verification of the client’s identity and which is consistent with your risk assessment?
- Can you demonstrate what you have done if asked to evidence your customer due diligence measures?
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