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AML Identity Check for Minor - Simplest Method?

Do Not Want Photo IDs of Children in My Office - Simplest Method of Identity Check for Child Client?

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Always been my custom to obtain copy passports/driving license for clients as photo ID to prove they exist etc. etc.

A fairly new trust client I deal with gives rise to substantial tax refunds for a minor child due to large trust distributions.

I now want to do an ID check on the child, who I have never met, in case of moneylaundering. Have been to dad's house (he is the trustee) and have seen circumstantial evidence that the child exists. I prepare the R40 for the child's refund, signed by his father.

I really do not want to ask father if I can copy son's passport, because it makes me feel uneasy. And I do not really want to have the child's photo in my filing cabinet. 

What is the easiest, safest way to do an ID check for a client who is a minor. I am a bit out of touch in this area.

 

 

 

Replies (21)

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By paul.benny
07th Feb 2020 07:47

Is it not the parents who you should be checking?

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By lincolnartist
07th Feb 2020 08:38

I hardly think a child’s passport solely by itself is going to cause concern for the Child Protection Unit

Thanks (5)
RLI
By lionofludesch
07th Feb 2020 09:25

Mask out the photo if it bothers you.

At least you have the passport number.

Though I think you're making a fuss over nothing.

Thanks (1)
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By Matrix
07th Feb 2020 09:25

I would advise to do the same for every client but if you are that concerned then ask for a copy of the birth certificate and make a note of why you decided not to get photo id.

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By ireallyshouldknowthisbut
07th Feb 2020 09:27

I agree with Paul.

Surely the parent is your client not the child?

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Replying to ireallyshouldknowthisbut:
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By Accountant A
07th Feb 2020 11:56

ireallyshouldknowthisbut wrote:

Surely the parent is your client not the child?

But the refund is in respect of the child so surely there needs to be some proof of existence or the father could just be making it up.

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Replying to Accountant A:
By penelope pitstop
07th Feb 2020 14:02

Another trust I dealt with resulted in seven annual R40 income tax repayments for the 7 minor grandchildren, three from one son and four from the other son of the settlor.

The seven R40s were all submitted in the same envelope to HMRC.

HMRC would not repay the income tax.

After umpteen telephone calls to HMRC and the passage of a considerable length of time I detected some movement on some of the R40 repayments. Then some repayments were made, but not all. They were repaid in fits and starts, apart from the last one which HMRC would not repay.

I asked HMRC why the staggered extreme delay in repaying the tax. HMRC said that the repayments had been referred to another department for security checks (I think they referred to a department in the South West or Wales).

So it seems that HMRC were checking the identity for each minor grandchild (rather than their parents). Temporary national insurance numbers were issued for the minor grandchildren, but not sure if they were issued after their security checks were made.

So, if HMRC are checking IDs for minors then I think I should too.

Maybe I am being OTT but I would still like to be able to do it without the childrens' photographs. But if I have to, I have to.

The final repayment was issued months after the first were made.

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Replying to penelope pitstop:
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By Accountant A
07th Feb 2020 14:17

penelope pitstop wrote:

So, if HMRC are checking IDs for minors then I think I should too.

I agree - I think you should.

I really don't think that an image of a child's face (on a passport or whatever) obtained legitimately and specifically for the purposes of money laundering compliance could cause you the slightest problem.

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By Truthsayer
07th Feb 2020 10:07

What do you imagine might be read into having a copy of the passport? Just treat the ID check as the same as for an adult.

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By GW
07th Feb 2020 11:31

Aside from the issue over whose identity should be verified, why the concern over having a copy passport for a minor?

Matrix, why would a birth certificate be considered better? I'm reluctant to use birth certificates given most of them come with the words "this is not proof of identity". Also a friend of my wife has an adopted son and nobody knows his date of birth, because his birth mother was registering multiple non existant births so she could claim additional benefits and it is not possible to identify which is the genuine record.

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Replying to GW:
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By Matrix
07th Feb 2020 12:14

Because I thought Penelope was concerned about photo id? I do the same for all clients so it is not my concern. If it is proof of existence of the child she wants to verify then it was just a suggestion. There may be other proof.

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RLI
By lionofludesch
09th Feb 2020 08:12

What would you do if the child didn't have a passport?

Do that instead.

Thanks (1)
Replying to lionofludesch:
Quack
By Constantly Confused
11th Feb 2020 14:32

lionofludesch wrote:

What would you do if the child didn't have a passport?

Driving license duh.

Or, and I only include this for the very rare occassions where I can't get a passport/driving license for any minor clients, their shotgun ownership certificate.

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Replying to Constantly Confused:
By penelope pitstop
11th Feb 2020 15:08

Ha ha ha ha ha.

Like that one!

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By DuncanM
11th Feb 2020 11:15

Under the 2017 Money Laundering Regulations, while you may consider the parent to be your client, if you are acting for a trust client then you are obliged to extend your AML checks to identify and take reasonable measures to verify the identity of all of the beneficial owners of the trust, which not only includes your client as trustee, but would have included undertaking AML check on all of the settlor, any co-trustees and the beneficiairies of the trust anyway, irrespective of whether you then went on to prepare tax refunds for them in their own right as a separate client.

I do not see any particular issues with holding this data on file in respect of a minor.

Thanks (1)
Hallerud at Easter
By DJKL
11th Feb 2020 11:26

Well, seems a DNA test on the child and its parents is the only way to proceed, check parents via their passports etc and then confirm child via DNA test and its birth certificate; seems like a perfectly reasonable request to me.

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Replying to DJKL:
By penelope pitstop
11th Feb 2020 13:54

I have decided that all children should take the Curly Wurly Test, to be administered by Terry Scott.

Each bite mark to be preserved as proof of ID.

What? Well it works for CSI !!!

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Replying to penelope pitstop:
Hallerud at Easter
By DJKL
11th Feb 2020 14:13

Catch is the bite will change over time- we seemed to spend most of our early married life taking the kids to the orthodontist, getting everything done whilst it was free- from moving teeth positions to tidying overbites.

Maybe your approach will work if they revisit a Curly Wurly after 10 years (like passports, in fact)

Thanks (1)
Replying to DJKL:
By penelope pitstop
11th Feb 2020 21:15

To be honest, cannot stand kids in the office anyway.

They're small and smelly, have sharp teeth and tend to bite!

Tend also to poke their fingers where they're not wanted.

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Replying to penelope pitstop:
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By JoF
12th Feb 2020 09:28

Bite them back - that stops them doing it again.

Also - if they are having a tantrum, fling yourself on the floor, wave arounds around and kick your legs about and scream, in if you are in the middle of Tesco - that stops all future tantrums....usually due to them being ultra embarrassed, although I cannot think why!

Thanks (1)
Replying to penelope pitstop:
Hallerud at Easter
By DJKL
12th Feb 2020 09:46

There is a plus point with other people's kids; you have no responsibility for them, they do not eat all your food, they do not drag you to watch really bad films at the cinema (Still traumatised by Pokemon The Movie after all these years) and even if you do have to but up with these attributes with say nieces and nephews you get to hand them back to their parents.

Frankly am really looking forward to possibly being a grandparent, take grandchildren for the day, feed them with all the things their parents do not want them to have (especially sugar, to get them buzzing) and then return them to their parents- revenge is a dish best served cold.

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