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Making the Best of a Bad Situation

By December 14, 2020June 26th, 2024No Comments

Making the Best of a Bad Situation


Due to the ongoing Covid-19 crisis, many businesses have been forced online to survive but what happens when moving online brings your business into potential conflict with your regulatory obligations?


The Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 & 2018, place a number of obligations on businesses to ensure that they don’t facilitate money laundering. Independent legal advisors, auditors and financial institutions are just some of those categorised as “designated persons” under s.25 of the 2010 Act.


As a designated person one of your first obligations is to ensure you know who your client is. In normal times this would probably be handled at an introductory meeting, where your prospective client would be asked to bring along valid government photo ID and proof of address but what can you do where Covid-19 means you may not get to meet the client in person?


Fortunately the 2010 Act is well set up for the present climate and s.33(2)(a) allows designated persons to verify the identity of their clients  “on the basis of documents (whether or not in electronic form)”. This does not mean that designated persons can avoid their obligations but rather it lets them use electronic means such as video conferencing, scanned images of government issued ID documents and other information “that the designated person has reasonable grounds to believe can be relied upon to confirm the identity of the customer”.


The key to compliance with the above is acting reasonably in the circumstances. Therefore, businesses should develop and enact robust procedures for client identification, always showing that they have taken as much care as is reasonably possible to ensure their clients are who they say they are.


While Covid-19 has presented many obstacles for businesses, it has also fast-tracked the move to remote working. This development could lead to increased competition nationally as it may now be just as easy for clients to have a virtual meeting from anywhere in the world as it is for them to drop in to your office on their lunch break.


If you have any queries or require any advice on any of the matters referred to in this article do not hesitate to contact Conor White on 01 2960666.