Identifying agents of customers

22-JAN-2010

Who needs to be identified when a reporting entity provides a designated service to a customer through the customer's agent?

Under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) a reporting entity must identify a customer before providing them with a designated service. Where an agent is acting on behalf of a customer, a reporting entity is required to identify both the agent and the customer.

Parts 4.2-4.7 of the Anti-Money Laundering and Counter-Terrorism Financing Rules Instrument 2007 (No. 1) (AML/CTF Rules) outline the customer identification procedures that reporting entities must comply with in relation to the customer.

Part 4.11 of the AML/CTF Rules outlines the identification requirements that reporting entities must comply with in relation to agents of customers.

Where the customer is an individual

Paragraphs 4.11.2-4.11.4 of the AML/CTF Rules apply when a customer who is an individual appoints an agent to act on their behalf.

Where the agent is an individual, the agent will need to be identified in accordance with paragraphs 4.11.2-4.11.4 of the AML/CTF Rules.

Where the agent is not an individual (such as a company), it will act through an individual - for example, an employee or director. In these circumstances, it is the individual who will need to be identified in accordance with paragraphs 4.11.2-4.11.4 of the AML/CTF Rules.

Where the customer is not an individual

Paragraphs 4.11.5-4.11.8 of the AML/CTF Rules apply when a customer that is not acting as an individual (for example, a company), appoints an agent to act on its behalf.

Where the agent is an individual, the agent will need to be identified in accordance with paragraphs 4.11.5-4.11.8 of the AML/CTF Rules.

Where the agent is not an individual (such as a company), it will act through an individual - for example, an employee or director. In these circumstances, it is the individual who will need to be identified in accordance with paragraphs 4.11.5-4.11.8 of the AML/CTF Rules.

Where the customer is not an individual and has appointed a verifying officer

Paragraphs 4.11.9-4.11.13 of the AML/CTF Rules apply when a customer that is not acting as an individual (for example, a company), appoints a verifying officer to identify its agents. Under paragraph 4.11.12 of the AML/CTF Rules, the verifying officer must collect certain information about the customer's agents including their name, position and level of authorisation.

For a reporting entity to rely on customer identification carried out by the verifying officer, the reporting entity must:

  • carry out the applicable customer identification procedure in respect of the verifying officer; and
  • obtain the full name of the agent and a copy of the agent's signature from the verifying officer.

Must a reporting entity obtain evidence of the customer's authorisation before dealing with an agent?

Under Part 4.11 of the AML/CTF Rules, where a reporting entity provides a designated service to an agent of a customer, the reporting entity has certain obligations to collect evidence of the customer's authorisation for that agent to act on their behalf.

Where the agent is acting on behalf of a customer who is an individual and where information and documentation exists which evidences the customer's authorisation for that agent to act on their behalf, the reporting entity must collect it.

Where the agent is acting on behalf of a customer that is not an individual (such as a company), the reporting entity must collect information and/or documentary evidence of the customer's authorisation for that agent to act on its behalf.

11-MAR-2013

Related information

05-MAR-2013

AML/CTF Act

AML/CTF Rules

Customer identification

07-MAR-2013

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