Is the “Selfie” compliant?

10th January 2018

HMRC have recently written to estate agents to provide clarification on the “selfie” method of undertaking Customer Due Diligence (CDD).

Supervised businesses have been requesting their clients take a “selfie” holding their picture ID next to their face in the photo. In this way it is possible to visually verify the identity of the individual in the “selfie” with the individual on the picture ID.

In HMRC’s view, the “selfie” method by itself does not meet the requirements under the Money Laundering Regulations 2017 “…because it isn’t possible to know if the identification is genuine or not – just seeing a photo of the identification won’t prove that it is.

Checking physical documents is part of good Customer Due Diligence (CDD), and should be carried out by all supervised businesses.”*

In it’s guidance HMRC advises that where paper documentation is sought supervised businesses should “take additional measures to verify the original documents supplied” (4.20**)

CLCK HERE to view HMRC guidance

Where paper ID is sought Compliance in a Box from Landmark enables estate agents to include the relevant information in an electronic check, thereby demonstrating you have verified the legitimacy of documentation provided.

Electronic checks undertake Customer Due Diligence in under 1 minute, in most cases negating the need to collect paper ID and therefore go through the process of verifying its legitimacy.

In higher risk scenarios where enhanced due diligence is appropriate, you must do more to verify identity and scrutinise the background and nature of the transactions. How this goes beyond standard due diligence must be made clear in your risk assessment and procedures.

You can for example:

• obtain additional information or evidence to establish the identity
• take additional measures to verify the original documents supplied
• ensure the first payment is made through a bank account in the name of the seller or buyer
• take more steps to understand the history, ownership, and financial situation of the parties to the transaction
• in the case of a politically exposed person establish the source of wealth and source of funds
• carry out more scrutiny of the business relationship and satisfy yourself that it is consistent with the stated purpose (4.20**)

 

Find out more about how you can use electronic checks to demonstrate Customer and Enhanced Due Diligence with pay-as-you-go checks from Landmark. No contracts, tie-ins, set up or data fees. Contact Samantha Peacock on 01524 220013/ sam.peacock@landmark.co.uk or complete the registration form below

* Source: HMRC
** Source: Anti Money Laundering Supervision: Estate Agency Businesses

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