Your 7 Point Checklist To Getting AML Customer Due Diligence Sorted

It can be really hard trying to stay on top of customer due diligence (CDD) when you’re dealing with a lot of clients, have complicated situations to manage, or information is taking time to be verified.

Daily working life for those affected by AML rules and regulations may not be as simple as it used to be, but you can make things easier for yourself by following a checklist of due diligence activity to ensure nothing slips through the gaps.

1. Dig deep and uncover details of your customers identity

Start off with a thorough look at your customer's identity. Getting evidence of this up front will save time and set you on the right track to getting the information you need to comply with AML due diligence regulations.

Most customers will have official documents such as a passport or NZTA drivers license to quickly show that they are who they say they are. Information you need to gather includes:

  • the person’s full name; and

  • the person’s date of birth; and

  • if the person is not the customer, the person’s relationship to the customer; and

  • the person’s address or registered office; and

  • nature and purpose of the proposed business relationship; and

  • any information prescribed by regulations.

Do this for your customer, any beneficial owner of your customer and any person acting on behalf of your customer. Remember that you need to find the actual human being who controls or receives the benefit - you cannot just look at the company or the trust.

2. Make sure you’ve got it right and verify identities

It’s not enough to just have evidence of a customer’s identity – you need to inspect this evidence and ensure it is verified so you can be satisfied the information provided is correct. And depending on the level of risk involved you must take reasonable steps to verify the identity of any beneficial owners, and verify the identity and authority of any person acting on behalf of your customer.

Documentary identity verification

If you are using documentary verification, verify the identity of you customer:

  • face to face; or by

  • ensuring copies of documents provided are certified by a trusted referee.

Who is a trusted referee?

In New Zealand a trusted referee must be 16 years or over and include people such as, police, justices of peace, registered medical doctors, registered teachers and lawyers.

Make sure the trusted referee isn’t related to the customer, a spouse or partner, involved in the business or transaction requiring certification, and doesn’t live at the same address as your customer.

Remember, for certification by a trusted referee to be valid:

  • The trusted referee must have sighted the original documentary identification, and made a statement to the effect that the documents provided are a true copy and represent the identity of your customer.

  • Certification must include the name, signature, and the date of certification. The trusted referee must specify their capacity to act as a trusted referee. It must also state that the photo on the identity document represents a true likeness of the person presenting it.

  • Certification must have been carried out in the three months preceding the presentation of the copied documents.

Electronic identity verification

If you need to carry out electronic identity verification you must verify your customer’s name from either:

  • A single