- Flexible approach to reliable and independent documentation
- Alternative identification documents – statement by a referee
- Photographic reference
- Completion of a letter
- Completion of a form
- Witness requirement
Some sections of the Australian community may have, for a diverse range of reasons, practical difficulty in meeting the identification requirements specified in Chapter 4 of the AML/CTF Rules – Applicable Customer Identification Procedure.
Some customers may not have identification documents that reporting entities most commonly use to establish and verify the identity of their customers, or the information contained in the documents may no longer be accurate or up to date. As a result, these people may face barriers in accessing financial services. This issue has been found to affect some customers of Aboriginal and/or Torres Strait Islander heritage.
AUSTRAC recommends that, where appropriate, reporting entities consider adopting a flexible approach to the identification and verification of persons of Aboriginal and/or Torres Strait Islander heritage, while remaining mindful of social and cultural sensitivities. This may include using 'reliable and independent' means of alternative identification for customers of Aboriginal and/or Torres Strait Islander heritage.
The AML/CTF Act and Rules provide reporting entities with a degree of flexibility concerning the identification and verification of customers in order to accommodate special circumstances. Chapter 1 of the AML/CTF Rules states that reliable and independent documentation includes but is not limited to:
- an original primary photographic identification document;
- an original primary non-photographic identification document; and
- an original secondary identification document.
Note: This is not an exhaustive definition. A reporting entity may rely upon other documents not listed in paragraphs (1) to (3) above as 'reliable and independent documents', where that is appropriate having regard to ML/TF risk.
AUSTRAC recommends that reporting entities consider adopting protocols to assist them to identify and verify customers of Aboriginal and/or Torres Strait Islander heritage, where reporting entities are unable to rely on conventional methods of identification and verification.
There may also be circumstances where persons of Aboriginal and/or Torres Strait Islander heritage may produce identification documents with conflicting information. For example, a person may have been allocated arbitrary dates of birth by different government agencies. These circumstances can make it difficult for a reporting entity to identify a customer and verify identity.
If the forms of documentation prescribed in the definition (refer to Chapter 1 of the AML/CTF Rules) of 'reliable and independent documentation' are not available or not of assistance in identifying a person, a reporting entity could accept an alternative document to verify the customer's identity, provided it is satisfied that the document is reliable and independent.
The purpose of this guidance is to provide examples of how a reporting entity might be satisfied about a person's identity in the absence of conventional identification documents. A reporting entity can assess the ML/TF risk of identifying a customer by way of a document such as an indigenous community identity card, or a formal reference / statement as to the customer's identity. Reporting entities could also require a customer to produce correspondence from a government authority that shows the customer's name.
A referee statement can take various forms, however commonly include statements addressing matters such as:
- the referee's knowledge of the person's name, and any other names which the person is, or has been known by;
- the referee's knowledge of the person's residential address, and any other addresses at which the person has resided;
- the referee's knowledge of the person's birth date (actual or approximate);
- the referee's knowledge of the person's familial connection to another relevant person;
- the specification of a minimum time period over which the referee has known the person;
- the capacity in which the referee knows the person; and
- the date on which the reference was given.
The following are some examples of alternative types of referee statement that a reporting entity may consider to be 'reliable and independent documentation'.
Some service providers in remote communities may be able to incorporate a photograph of the customer into a statement as to the identity of the customer, using the letterhead stationery of the organisation. Where appropriate, reporting entities may consider such a reference a suitable alternative for a formal photographic identification document.
Reporting entities may also consider accepting referee statements in the form of a letter written by the referee in their capacity as an official of a particular organisation, on the letterhead stationery of that organisation. Reporting entities may choose to provide a template for potential referees to complete.
Reporting entities could use a form developed to meet their specific requirements for a referee statement.
In the case of a referee statement, a single document could include both:
- the information collected from the customer; and
- the (reliable and independent) verification of the information by the referee.
The referee statement form could include a requirement that the completion of the form be witnessed. The reporting entity may require this, for example, if it has concerns about whether the customer and the referee are sufficiently independent, or about the potential for undue influence on the customer.
Where it is considered desirable that a referee statement requires a witness, the statement could specify any minimum required qualifications of the witness, such as a requirement that the witness be a recognised community leader. Explaining any witness requirements imposed by one reporting entity may facilitate the acceptance of the reference by other reporting entities.
Reporting entities could also require a customer to produce correspondence from a government authority that shows the customer's name.
Examples of referees might include:
- Chairperson, Secretary or CEO of an Aboriginal/Torres Strait Islander organisation, or a board member of a local Aboriginal Land Council
- School principal or School counsellor
- A Minister of Religion
- Health Professional or Manager in Aboriginal/Torres Strait Island Medical Services
- Police officer
- Another person before whom a statutory declaration can be made
- Community leader or recognised Elder (who is not a parent, sibling, or child of the subject)
- The customer's current employer or manager.
Under the risk-based approach, such as where the customer has requested to access high-value or sophisticated financial services, reporting entities might also require referees to themselves provide a government document attesting to their identity.
The following scenarios demonstrate how a reporting entity could identify customers who identify as being of Aboriginal and/or Torres Strait Islander heritage, in accordance with the provisions of Chapter 4 of the AML/CTF Rules.
Example 1: Opening an account
Customer E wishes to open an account with the Careful Credit Union. In processing customer E's application, Careful CU found that it was unable to verify his identity. Customer E explained that he lives in a remote community and has recently changed his name.
Example 2: Superannuation beneficiary
Customer C has recently died, leaving a daughter customer D. Customer D is the beneficiary of customer C's superannuation policy held with Nestegg Super. However, Customer D's full name is now different to the name that was originally recorded in the beneficiary nomination, as she changed her name following customer C's death. Nestegg wants to be sure that customer D is actually customer C's daughter, and asks customer D for some information about her name change.
Customer D identifies as being of Aboriginal and/or Torres Strait Islander heritage, and informs Nestegg that it is customary to not use the name of a person who has died. Customer D does not have any official identification documents that show her new name. Further, while customer D has provided her name and address, she does not know her actual date of birth – she can provide information about her year of birth, and her place of birth.
Nestegg has been unable to verify either customer D's current name, or her DOB. Nestegg assesses the level of ML/TF risk to be low, and decides to verify customer D's identity with a reference completed by an acceptable referee. Customer D explains that the medical doctor that treated customer C is also customer D's doctor, and is aware of the relationship between customers C and D: the medical doctor could therefore provide a reference as to the relationship between customers C and D. Nestegg requests that customer D obtain a reference from the medical doctor that treated customer C.
Example 3: Conflicting identification documents
Customer F wishes to open an account with the Happy Returns Bank. Customer F provided the bank with a range of identification documents issued by government departments – however, the documents show variations in customer F's name, and show different dates of birth. Customer F does not know which of the recorded dates of birth is accurate. Happy Returns is not sure which document (if any document) they should use to identify customer F via electronic means.
Happy Returns asks customer F for copies of the various documents, and for a reference from an office-bearer of the local Aboriginal Land Council of which customer F is a member, which states that the person named in each of the documents provided is customer F. The office-bearer of the Land Council provided a reference on its official stationery that included a photograph of customer F.