Procedures for client verification

(1) IFS Practitioners shall ensure that all their staff are familiar with and apply relevant procedures to verify and adequately document the true identity of clients, and for this purpose, identity will usually include a current address or place of business. (2) IFS Practitioners shall not conduct business with persons using obviously fictitious names or addresses and shall not keep anonymous accounts. (3) Verification of identity will not normally be required in the case of an isolated transaction unless the circumstances surrounding such transaction appear on an objective standard to be unusual or questionable, in which case it will be necessary to make further enquiries. (4) IFS Practitioners may be required to take steps to verify a client’s identity if money laundering is known or suspected according to the results obtained pursuant to paragraph (3) above. (5) Where money laundering is known or suspected under paragraphs (3) and (4) above, an IFS Practitioner shall not refrain from making a report to the appropriate body under these Regulations merely because of the size of the transaction. (6) In this regulation, “isolated transaction” means– (i) a transaction carried out other than in the course of an established business relationship, (for example, a single foreign currency transaction for a customer who does not have an account at the bank concerned constitutes an “isolated transaction”); and (ii) a payment made by or to a person in the transaction which is below US$30,000 (or its equivalent in other currency) unless the payment is one of a series of transactions carried out within three months which are or appear to be linked and in which the aggregate payment exceeds US$30,000 (or its equivalent in other currency).