The GFSC have issued a FAQ to answer the following question
- We have discovered that we have not undertaken CDD in compliance with the requirements of the Regulations and/or rules in the Handbook.
- We are reluctant to approach the customer and
- Would like an exemption from having to comply with these requirements.
GFSC response
- The Commission does not have the power to exempt a business to whom the Regulations apply from complying with its requirements.
- Neither would it be appropriate for the Commission to provide its consent for a business to derogate from the rules in the Handbook.
They go on to say
- The rules are specifically designed to assist businesses in complying with the requirements of the relevant legislation concerning money laundering, terrorist financing and related offences to prevent the Bailiwick’s financial system from being used in the laundering of money or the financing of terrorism.
- The Commission expects that a business will take a risk-based approach in considering the steps that should be taken by it, in the absence of compliance customer due diligence having been undertaken, to mitigate the financial crime risks to which it could otherwise be exposed prior to processing the transaction.
- The Commission would expect that a member of the business’ compliance staff are alerted and advice sought from them, beforehand.
- The decision whether to proceed with the transaction should be recorded. The record should evidence the measures taken and controls applied to mitigate the associated financial crime risks.
- Businesses should also be conscious that the circumstances could also lead to the forming of a suspicion for which a SAR should be made.
- The Commission would encourage businesses to engage with the Financial Crime Supervision and Policy Division in such circumstances, and should be mindful of the requirements of rule 30 of the Financial Services Businesses Handbook and rule 46 of the Prescribed Business Handbook.
- These rules require that the board of a business, or equivalent, ensure that the Commission is advised of any material failure to comply with the provisions of the Regulations and the rules in the Handbook, and of any serious breaches of the policies, procedures and controls of the business.
(Date of Issue: 19 June 2014)
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