In an increasingly digital world where face to face interactions are becoming less common, it's crucial for accountants to have reliable methods to verify the identity of their clients.
AML for GoProposal offers three types of ID checks to meet your specific needs, whether you store photocopies of identity evidence or operate in a predominantly virtual environment.
In this article, we will explore the types of ID checks available and their suitability for different scenarios.
What type of ID check is right for a new client?
All three ID checks in AML for GoProposal will automatically scan for PEPs (Politically Exposed Persons), Sanctions, and verify dates of birth and addresses, however both document and biometric checks will also automatically collect, verify and store your clients ID document, saving you time and allowing you to be closer to compliance in virtual working settings.
Basic Check: If you meet your clients face to face and store photocopies of evidence, you may opt for the basic check. This option omits the collection and verification of IDs since you have already done this step, however the basic check scans for PEPs (Politically Exposed Persons), Sanctions, and Adverse Media flags. These checks are crucial aspects of an accountant and bookkeepers' monitoring responsibilities under the Money Laundering regulations. The basic check offers a streamlined way to ensure compliance with these specific regulations, and the results of this check will aid you in answering your client Risk Assessment.
Biometric Checks: In cases where it is not possible to meet your client in person, biometric checks provide a strong level of verification confidence. This type of check collects, verifies, and stores the client's ID document. It ensures that the document is original and not fraudulent whilst also confirming the person supplying the document is the person you are dealing with, using facial similarity technologies. Biometric checks offer comprehensive verification when face to face interactions are not possible or practical.
Document Checks: Document checks allow you to collect, store, and verify the authenticity of the client's ID document, however in contrast to the biometric, they do not include facial similarity technologies (is the person supplying the document the individual on the document?). Thus, they are suitable when you can meet your client in person to confirm facial similarity but cannot do so immediately, or where you are happy you can meet the client virtually to confirm their identity. Document checks offer a balance between compliance and convenience in scenarios where face to face meetings are feasible but either delayed or virtual.*
*Please note that the suitability of virtual meetings is a heavily debated topic and should be confirmed with the relevant governing bodies as opinions differ (if in doubt, opt for a biometric).
We encourage you to consider your specific requirements, your governing body and firms risk based policies to determine the appropriate ID check for you.
What type of ID check is right for an existing client?
Once you have a verified, stored copy of the ID that you are confident is authentic and belongs to the person you are dealing with, you might not need to go through a rigorous identification process repeatedly (unless anything has changed).
In these cases, the basic check is often the best option for an existing client. This type of check helps determine if the client is politically exposed, appears on any sanctions lists, or is associated with adverse media. These areas should be monitored regularly to ensure compliance and mitigate risks.
It's also essential to regularly review your client's risk assessment, as monitoring changes in your client's circumstances is crucial.
If there is a change in the name of a key individual, the appearance of a new Beneficial Owner or key director, or any other significant alteration, it may be necessary to collect new identification documents. In such cases, opting for a more enhanced check can help confirm the identity of the individual and ensure compliance with regulations (as if they were a new client).
AML for GoProposal provides Risk Assessment templates specifically designed for annual renewals, which can assist in this process and guide you on what to do.
Remember, maintaining robust identification and verification processes for existing clients is essential to mitigate risks and uphold regulatory standards.
Regular checks, risk assessments, and periodic updates to client information contribute to a comprehensive and effective approach to client identification.