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MLR check - how far do you take it?

 I must admit that I have always drawn a line at family members .... I was fairly envolved with my neice being born and my brothers have pretty much always been about ... I really don't think I need to confirm their identities formally!

The thing is, if you accept there rationally can be some exceptions then what about the client I am looking at this morning? I have known him for about 20 years. We have gone on holiday together and at no point was he arrested going through passport control. Some years ago we owned a business together and have therefore used the same solicitors. He has lived in the same house all that time and I attended his mum's funeral a while ago. I think I probably have a good idea of who he is.

So, if he is perhaps OK ... what about his brother who is has started his new business with. I don't know him apart from as my friends brother but they have kept the pretence up for a very long time!

What about my dad's nice neighbours? To all the world they appear to be genial pensioners with modest incomes and no hobbies remotely involving the use of semtex. 

Every now and then I think this is all a total waste of time and need reassurance that through my efforts I am keeping the global tide of terrorism at bay single-handedly.

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You've been to there house

Presumabley you have visited the client at their home.

Therefore if you have correspondence addressed to them at that house (A tax return request for example) you can keep that on file and say you visit the client to verfiy the address you have done the initial checks.

The rest is all about risk assessment. 

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risk based approach

In the case of friends, I would take a copy of photo ID and proof of address and leave it at that.

The only people I have not done any MLR on whatsoever are my parents and siblings. I work on the theory that if they've fooled me for decades, then seeing their ID (which will check out!) isn't going to make any difference at all, and that is my informal risk assessment of them!

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Risk assessment

 The key criteria is the risk assesment.

Photo ID and proof of address, along with copy, paste, edit of the post you just made explaining the relationship should cover you quite easily!

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But you're missing the point (or I am)

Surely Steve's query wasn't about the mechanics of deciding exactly how much evidence you need, but about the much broader point that all of this feels like complete b*ll*x most of the time.

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It is utter tosh

Dreampt up by stupid politicians and enforced by job's worth civil servants.

A complete and utter waste of time and money.

 

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A cunning plan

Steve

You are clearly concerned that your friends and neighbours may be foreign terrorists operating as deep undercover sleepers.  Might I suggest a cunning plan to avoid any possibility of taking on such dodgy clients?

Ask the seemingly innocuous question, "How often did Ryan Giggs play away from home last season?".  If they do not know the answer do not take them on as a client.

On the other hand, if they DO know the answer then DEFINITELY do not take them on as a client!

David

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Photo ID ...

 Do I need that from my brothers as they appear in all three sets of my wedding photos .... having said that the first lot taken when we all had perms in the 1980's could just as easily be the Jackson five!!

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.

I ID'd my neighbour. I did do it in a light hearted way however, stressing that this was a business relationship and I was treating this as 'business' and my hours are XYZ.  If on the other hand as my neighbour he needed anything other than his tax return, then just knock on the door as normal.

That is to say I used the ID check to set the expecations which isnt a bad thing when working with family/friends which I tend to try and avoid if possible.

 

 

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Photo ID

Steve

Actually there is no requirement in the MLR for photo ID, but obviously the best forms of ID (for a client whom you actually meet) are items which include a photo.

If you are dealing with an individual whom you meet (and who is not a 'Politically Exposed Person') and you are undertaking routine accounts / tax etc work for them, then a passport will (on its own) be sufficient to satisfy the initial ID requirements.

Where accountants are most at risk of coming unstuck are where they handle client funds.  This obviously increases money laundering risk.

In one case I dealt with the accountant described himself in police interview (yes - things had got that bad) as his client's "accountant and banker".  He had been happily accepting monies and sending it overseas on the client's instructions (oblivous to the risk that the client might be a dodgy geezer using the accountant to forward his proceeds of crime to another country).  Suffice to say I would not recommend you to do that (not even for your charming elderly neighbours!).

David

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Ignore the rules and they might go away

 Every now and then I think this is all a total waste of time

Surprisingly positive from my standpoint.  I'd love to see what percentage of MLR ID checks throw up something that is related to (a) terrorism and (b) serious crime.  Yes I know it's also supposed to function as a deterrent, but I could produce forgeries that would pass muster if I wanted to and frankly for all the time and effort wasted, I'd rather live with the huge wave of crime and bombings that would result in ignoring the rules altogether.  

If somebody seems dodgy - check 'em.

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Passports

Some of my clients are such old friends that I was the one who signed the passport application to say they were who they said they were.

So if I now use a copy of their passposrt as ID surely that is going in circles.  If the passport office will take my word for it, then it seems silly to have to do much else.

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Non-compliance!

I have to confess that I didn't take any ID evidence for the 98 year old lady in the local nursing home that I took on as a favour for a firm of solicitors - I'm guessing she wouldn't have a utility bill anyway or probably a current passport or driving licence! She's now fast approaching 102 and there's been no sign that the refunds I'm getting her are part of a cunning multi-national money laundering operation so hopefully I'm OK!!

Cathy

P.S. I did get passports from the friends whose returns I fill in - just for a laugh at their passport photos!

[email protected]

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Centenarian gangsta?

Cathy

I think your centenarian client might be described as low risk, but if you did decide you needed ID then you could accept a letter from the matron (or similar) of the home in which she is living.  Alternatively I suppose you could insist that she applies for a driving licence!  (A joke - just in case anyone thought I meant it!)

David

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MLR risk assesment - whose?

Re: Monsoon - I leave parents and siblings out.

Careful! I eventually found out my parents (am I their child? Who knows) wedding aniversary date and found out I was a premature baby!

By the way MLR has nothing to do with terrorism. Governments seized on it because it made "designated" people spies for revenue authorities. When it started in the country I was working in at the time it was tax, tax, tax. The police were not really interested unless a major drug crime.

I still resent being a Government spy. A prospective client smells, I walk away. Always did and will do. Existing clients if running foul (petty matters always) get told to get their act together and they do as most people are honest even if chancing it at times.

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From memory . . .

From memory about 0.5% of Suspicious Activity Reports sent to SOCA concern suspicions of terrorism related offences.

I did put the figures on the Money Laundering and Crime Discussion Group board a while back.

Unsurprisingly the banks / building societies are the source of the bulk of all reports filed.

David

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