Criminal Justice (Money Laundering and Terrorist Financing) Act 2010
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Chapter 3 Customer Due Diligence | ||
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Identification and verification of customers and beneficial owners. |
33.— (1) A designated person shall apply the measures specified in subsections (2) and, where applicable, (4), in relation to a customer of the designated person— | |
(a) prior to establishing a business relationship with the customer, | ||
(b) prior to carrying out an occasional transaction with, for or on behalf of the customer or assisting the customer to carry out an occasional transaction, | ||
(c) prior to carrying out any service for the customer, if the person has reasonable grounds to believe that there is a real risk that the customer is involved in, or the service sought by the customer is for the purpose of, money laundering or terrorist financing, based on any of the following, or other, circumstances: | ||
(i) the customer, or the type of customer, concerned; | ||
(ii) if the person has a business relationship with the customer, the type of business relationship concerned; | ||
(iii) the type of service or of any transaction or product in respect of which the service is sought; | ||
(iv) the purpose (or the customer’s explanation of the purpose) of the service or of any transaction orproduct in respect of which the service is sought; | ||
(v) the value of any transaction or product in respect of which the service is sought; | ||
(vi) the source (or the customer’s explanation of the source) of funds for any such transaction or product, | ||
or | ||
(d) prior to carrying out any service for the customer if— | ||
(i) the person has reasonable grounds to doubt the veracity or adequacy of documents (whether or not in electronic form) or information that the person has previously obtained for the purpose of verifying the identity of the customer, whether obtained under this section or section 32 of the Criminal Justice Act 1994 (“the 1994 Act”) prior to its repeal by this Act or under any administrative arrangements that the person may have applied before section 32 of the 1994 Act operated in relation to the person, and | ||
(ii) the person has not obtained any other documents or information that the person has reasonable grounds to believe can be relied upon to confirm the identity of the customer. | ||
(2) The measures that shall be applied by a designated person under subsection (1) are as follows: | ||
(a) identifying the customer, and verifying the customer’s identity on the basis of documents (whether or not in electronic form), or information, that the designated person has reasonable grounds to believe can be relied upon to confirm the identity of the customer, including— | ||
(i) documents from a government source (whether or not a State government source), or | ||
(ii) any prescribed class of documents, or any prescribed combination of classes of documents; | ||
(b) identifying any beneficial owner connected with the customer or service concerned, and taking measures reasonably warranted by the risk of money laundering or terrorist financing— | ||
(i) to verify the beneficial owner’s identity to the extent necessary to ensure that the person has reasonable grounds to be satisfied that the person knows who the beneficial owner is, and | ||
(ii) in the case of a legal entity or legal arrangement of a kind referred to in section 26 , 27 , 28 or 30 , to understand the ownership and control structure of the entity or arrangement concerned. | ||
(3) Nothing in subsection (2)(a)(i) or (ii) limits the kinds of documents or information that a designated person may have reasonable grounds to believe can be relied upon to confirm the identity of a customer. | ||
(4) Without prejudice to the generality of subsection (2)(a), one or more of the following measures shall be applied by a designated person under subsection (1), where a customer who is an individual does not present to the designated person for verification in person of the customer’s identity: | ||
(a) verification of the customer’s identity on the basis of documents (whether or not in electronic form), or information, that the designated person has reasonable grounds to believe are reliable as confirmation of the identity of the customer in addition to any documents or information that would ordinarily have been used to verify the customer’s identity if the customer had presented to the designated person for verification in person of the customer’s identity; | ||
(b) verification of documents supplied, for the purposes of verifying the identity of the customer under this section, to the designated person by the customer; | ||
(c) verification of the customer’s identity on the basis of confirmation received from an acceptable institution that the customer is, or has been, a customer of that institution; | ||
(d) ensuring that one or more of the following transactions is carried out through an account in the customer’s name with an acceptable institution that is a credit institution: | ||
(i) the first payment made by the customer to the designated person for the provision of a service; | ||
(ii) in the case of a designated person acting for or on behalf of the customer in respect of a financial transaction or a transaction relating to land, the first payment made by the customer in respect of the transaction; | ||
(iii) in the case of a designated person that is anothercredit institution or is a financial institution, the first payment made by the customer to the designated person for the provision of a product; | ||
(iv) in the case of a designated person that is another credit institution, the first occasion on which credit is received by the customer from the designated person or on which money is deposited with the designated person by the customer; | ||
(v) in the case of a designated person trading in goods in respect of transactions involving payments as referred to in section 25 (1)(i), the first such payment made by the customer to the designated person. | ||
(5) Notwithstanding subsection (1)(a), a designated person may verify the identity of a customer or beneficial owner, in accordance with subsections (2) and, where applicable, (4), during the establishment of a business relationship with the customer if the designated person has reasonable grounds to believe that— | ||
(a) verifying the identity of the customer or beneficial owner (as the case may be) prior to the establishment of the relationship would interrupt the normal conduct of business, and | ||
(b) there is no real risk that the customer is involved in, or the service sought by the customer is for the purpose of, money laundering or terrorist financing, | ||
but the designated person shall take reasonable steps to verify the identity of the customer or beneficial owner, in accordance with subsections (2) and, where applicable, (4), as soon as practicable. | ||
(6) Notwithstanding subsection (1)(a), a credit institution may allow a bank account to be opened with it by a customer before verifying the identity of the customer or a beneficial owner, in accordance with subsections (2) and, where applicable, (4), so long as the institution ensures that transactions in connection with the account are not carried out by or on behalf of the customer or beneficial owner before carrying out that verification. | ||
(7) Notwithstanding subsection (1)(a), a designated person may verify the identity of a beneficiary under a life assurance policy, in accordance with subsections (2) and, where applicable, (4), after the business relationship concerned has been established, but the designated person shall carry out that verification before— | ||
(a) the policy is paid out, or | ||
(b) the beneficiary exercises any other right vested under the policy. | ||
(8) A designated person who is unable to apply the measures specified in subsection (2) or (4) in relation to a customer, as a result of any failure on the part of the customer to provide the designated person with documents or information required under this section— | ||
(a) shall not provide the service or carry out the transaction sought by that customer for so long as the failure remains unrectified, and | ||
(b) shall discontinue the business relationship (if any) with the customer. | ||
(9) Except as provided by section 34 , a designated person who fails to comply with this section commits an offence and is liable— | ||
(a) on summary conviction, to a fine not exceeding €5,000 or imprisonment for a term not exceeding 12 months (or both), or | ||
(b) on conviction on indictment, to a fine or imprisonment for a term not exceeding 5 years (or both). | ||
(10) In this section, “acceptable institution” means a credit institution or financial institution (other than an undertaking that is a financial institution solely because the undertaking provides either foreign exchange services or payment services, or both) that— | ||
(a) carries on business in the State as a designated person, | ||
(b) is situated in another Member State and supervised or monitored for compliance with requirements specified in the Third Money Laundering Directive, in accordance with Section 2 of Chapter V of that Directive, or | ||
(c) is situated in a place designated under section 31 and supervised or monitored in the place for compliance with requirements equivalent to those specified in the Third Money Laundering Directive. | ||
(11) The Minister may prescribe a class of documents, or a combination of classes of documents, for the purposes of subsection (2)(a)(ii), only if the Minister is satisfied that the class or combination of documents would be adequate to verify the identity of customers of designated persons. | ||
(12) For the purposes of subsection (2)(a)(ii), the Minister may prescribe different classes of documents, or combinations of classes of documents, for different kinds of designated persons, customers, transactions, services or risks of money laundering or terrorist financing. |