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International ID Checks

International ID Checks

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Ours is a small practice offering outsource finance function services to UK subsidiaries or branches of (mainly) US parent companies. Invariably all directors and shareholders are US citizens and in many cases we never meet them in person, although we deal with them frequently by telephone and email. Historically the lengths we go to to meet our Know Your Client responsibilities have been time-consuming, costly and not very client-friendly and we are trying to finesse things. Does anyone have a view on how far online ID checks such as from Veriphy go towards satisfying the ID verification requirements for overseas individuals?

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By Roland195
23rd Apr 2012 14:39

Online Checks

When I used an online AMLR package, I found the following limitations (aside from a legal issue I have spoken of at length in other posts):-

1. You need a driver's licence/passport ID number as a starting point. If they have neither you are stuck and if you have these documents, I'm not sure what exactly the online verification adds.

2. I  encountered a problem where the client's address was too new (never really understood this as they received post, had an electric supply & paid Council Tax) to be recognised on the Post Code system. The report generated did not really make clear what it had checked but basically did not report it as a "fail". In fact, none of the checks I carried out failed.

 

 

 

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Replying to garforth:
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By Merrygirl
23rd Apr 2012 10:56

Verifying international ID

If you get a copy of the passport or drivers license is that enough? We were working on the assumption that you need to see the original or have it certificated, the latter being the only option where you do not meet the client in person. 

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Replying to lionofludesch:
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By Roland195
23rd Apr 2012 11:13

Far from an expert

Merrygirl wrote:

If you get a copy of the passport or drivers license is that enough? We were working on the assumption that you need to see the original or have it certificated, the latter being the only option where you do not meet the client in person. 

As I understand it, you can't just stick a photocopy/scan on your file unless you have viewed the original (which would also necessitate actually meeting the person).

My problem would be who would certify it? My understanding is that you need some sort of connection with the person doing the certifying (which makes sense) - seems more geared up to help the Big 4 who are likely to have a local office that could deal with it.

 

 

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Replying to lionofludesch:
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By Merrygirl
23rd Apr 2012 13:53

Does the online verification take away the need for certification? That's the bit that's not very client-friendly. I couldn't find your previous comments re legal issues. Is it relating to Data Protection? Bottom line: if you have (uncertificated) copies of photo id and utility bill AND you have run an international ID check on Veriphy, including PEP and Sanctions which comes back clear, is that enough verification?

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Replying to ash428:
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By Roland195
23rd Apr 2012 14:37

Legal issues

Merrygirl wrote:

Does the online verification take away the need for certification? That's the bit that's not very client-friendly. I couldn't find your previous comments re legal issues. Is it relating to Data Protection? Bottom line: if you have (uncertificated) copies of photo id and utility bill AND you have run an international ID check on Veriphy, including PEP and Sanctions which comes back clear, is that enough verification?

The legal issues I had were to do with if the client has to be notified that you are doing this check & what effect this could have on a their credit rating (the product I used was basically a repackaged credit check facility). I had been listening to an article on the radio where a credit expert was explaining how everytime a credit file is accessed, it leaves a "footprint" which may figure negatively in a future credit check. My further research never satisfactorily answered the question.

 

 

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By Hansa
23rd Apr 2012 15:26

Non face-to-face

The following satisfies every bank we deal with across the world for "non face-to-face account openings"!  As banks actually handle the cash, you may assume that their MLR requirements in the toughest jurisdictions are tougher than yours! 

1. Passport copy Notarised & Apostilled  (The Notarisation is certification of it being a true copy, the Apostille is the foreign ministry (or State equivalent in the USA)  confirmation that the Notary exists etc.)  This is pursuant to the Hague Convention 1961 which most countries including the UK have signed up to and which "legalises" the document.

2(a) One or two utility bills OR financial (bank/credit card) statements indicating the residential address.

AND/OR

2(b) A professional reference from a lawyer/certified public accountant who has known the client for a least a year.

The reason I say "and/or" is that not everywhere demands proof of address (in general it is only the Anglosphere).  If you request all 3, you cannot go wrong in terms of the UK MLR.  For Americans (who frequently DON'T have passports), you could substitute a driving licence as this is ubiquitous for proving ID 

I would hesitate before going further than the above as, unlike the UK, it would be rare to be asked for endless "ID" in most countries, and clients will object. - Even the above might prove to be too much for, eg a minority shareholder with a 25.1% holding (the lower level per MLR 2007 (6)).  For such inactive particpents you could probably accept (1) the certified passport only

 

 

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