Why do I need to identify a beneficial owner?
Doing business with non-individual customer types has different risks than doing business with individuals. It is a requirement from AUSTRAC under Part B of and AML/CTF Program for businesses to identify and verify their customers and understand their customers’ financial activities. By knowing its customers, a business should be better able to mitigate risks such as money laundering and terrorist funding. It is crucial for businesses in certain industries to comply with KYC/ AML (anti-money laundering) regulations. Failure to comply can result in fines and other consequences. In order to meet the obligations of compliance, you must:
Assess the money laundering/terrorism risk posed by the beneficial owners of your customers. It is necessary to review beneficial owner risks regularly.
Determine the identity of the beneficial owner(s) of your non-individual customers.
Collect and take reasonable measures to verify each beneficial owner’s identification information such as full name, date of birth and residential address.
Keep records of the beneficial owner identification processes to comply with Division 3 of Part 10 of the AML CTF Act 2006.
Document how you will fulfil your obligations in the AML/CTF program.
How to discover a beneficial owner