Know your customer

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As know your customer ( KYC ; German: know your customer ) is a particularly banks and insurance companies prescribed identification check of certain new customers for the prevention of money laundering referred.

backgrounds

With the reason to fight money laundering, criminal machinations as well as economic crime and terrorism , international minimum standards for the identification of new customers were created. These rules are intended to prevent, for example, money from being shifted back and forth via bogus companies. Before opening an account for new customers, the KYC must be used to check who the customer is, what the business model looks like and where the financial flows come from.

Legal basis

The decisive basis for the KYC requirement of European financial companies in Germany are §§ 10 to 17 of the Money Laundering Act (due diligence with regard to customers), which under European law are based on Articles 10 to 29 of the 4th EU Anti-Money Laundering Directive, supplemented by the 5th EU Anti-Money Laundering Directive. "Standard small customers" who do not want to conduct particularly extensive or particularly unusual business and who have been assigned to a correspondingly safe risk class in advance can be excluded from the general check .

These reviews are also important from the point of view of a wide variety of laws and regulations on counter-terrorism and compliance . In particular, various national laws and regulations of international organizations prohibit business with certain people and countries. If, for example, the special regulations of the United States of America are not adhered to, the financial companies face severe fines and imprisonment for the executive employees up to the withdrawal of the entire business license in the USA. In addition, the reputational risk that negative headlines can cause if there is a lack of control should not be underestimated.

Information to be collected

In the case of natural persons , in particular the type of professional activity and the purpose of the business relationship must be recorded.

In the case of legal entities , the type of company, activity, sector, sector code, number of employees, ownership and company structure as well as the most important (expected) financial indicators must be recorded.

Furthermore, the origin of funds and assets must generally be clarified. The details of the planned customer relationship such as scope and z. B. Payment types must be recorded.

In the case of politically exposed persons (PEP) , the function and place of exercise must also be recorded.

All persons significantly involved in the creation of the KYC as well as subsequent changes to the KYC master document must also be recorded.

Individual evidence

  1. ↑ Whitepaper: KYC -Know Your Customer ( Memento from January 31, 2012 in the Internet Archive )
  2. ↑ Implementation of the 5th Money Laundering Directive and expansion of the register of beneficial owners. Federal Ministry of Finance (Austria) , accessed on May 3, 2020 .
  3. ↑ Law on tracking down profits from serious criminal offenses (Money Laundering Act) (PDF; 224 kB)
  4. ↑ DIRECTIVE (EU) 2015/849 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of May 20, 2015 on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing, amending Regulation (EU) No. 648/2012 of the European Parliament and the Council and repealing Directive 2005/60 / EC of the European Parliament and of the Council and Directive 2006/70 / EC of the Commission (PDF; 722 kB)
  5. ↑ DIRECTIVE (EU) 2018/843 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing and amending Directive 2009/138 / EG and 2013/36 / EU (PDF; 933 kB)