Due Diligence – Sectoral guidelines for life insurance undertakings

Due Diligence – Sectoral guidelines for life insurance undertakings

EBA has published the final Guidelines under Articles 17 and 18(4) of Directive (EU) 2015/849 on simplified and enhanced customer due diligence. The Risk Factors guidelines give an overview on the factors credit and financial institutions should consider when assessing the money laundering and terrorist financing risk associated with individual business relationships and occasional transactions.

Due Diligence – Sectoral guidelines for life insurance undertakings

191.

The following EDD measures may be appropriate in a high-risk situation:

• Where the customer makes use of the ‘free look’/‘cooling-off’ period, the premium should be refunded to the customer’s bank account from which the funds were paid. Firms should ensure that they have verified the customer’s identity in line with Article 13 of Directive (EU) 2015/849 before making a refund, in particular where the premium is large or the circumstances appear otherwise unusual. Firms should also consider whether the cancellation gives rise to suspicion about the transaction and whether submitting a suspicious activity report would be appropriate.  

• Additional steps may be taken to strengthen the firm’s knowledge about the customer, the beneficial owner, the beneficiary or the beneficiary’s beneficial owner, the third party payers and payees. Examples include:

i. not using the derogation in Article 14(2) of Directive (EU) 2015/849, which provides for an exemption from upfront CDD;

ii. verifying the identity of other relevant parties, including third party payers and payees, before the beginning of the business relationship;

iii. obtaining additional information to establish the intended nature of the business relationship;  

iv. obtaining additional information on the customer and updating more regularly the identification data of the customer and beneficial owner;

v. if the payer is different from the customer, establishing the reason why;  

vi. verifying identities on the basis of more than one reliable and independent source;  

vii. establishing the customer’s source of wealth and source of funds, for example employment and salary details, inheritance or divorce settlements;  

viii. where possible, identifying the beneficiary at the beginning of the business relationship, rather than waiting until they are identified or designated, bearing in mind that the beneficiary can change over the term of the policy;  

ix. identifying and verifying the identity of the beneficiary’s beneficial owner;

Due Diligence – Sectoral guidelines for life insurance undertakings

192.

Article 20 of Directive (EU) 2015/849 requires that, where the risk associated with a PEP relationship is high, firms must not only apply CDD measures in line with Article 13 of the Directive but also inform senior management before the payout of the policy so that senior management can take an informed view of the ML/TF risk associated with the situation and decide on the most appropriate measures to mitigate that risk; in addition, firms must conduct EDD on the entire business relationship.

193.

More frequent and more in-depth monitoring of transactions may be required (including where necessary, establishing the source of funds).

Simplified customer due diligence

194.

The following measures may satisfy some of the CDD requirements in low-risk situations (to the extent permitted by national legislation)

• Firms may be able to assume that the verification of the identity of the customer is fulfilled on the basis of a payment drawn on an account that the firm is satisfied is in the sole or joint name of the customer with an EEA-regulated credit institution.
• Firms may be able to assume that the verification of the identity of the beneficiary of the contract is fulfilled on the basis of a payment made to an account in the beneficiary’s name at a regulated EEA credit institution.

Compliance & Geldwäschebeauftragter – Due Diligence – Sectoral guidelines for life insurance undertakings

Unsere Praxisseminare Geldwäsche und Fraud – Basisseminar, Geldwäsche und Fraud – Aufbauseminar, Geldwäsche & Fraud – Update und Geldwäsche & Fraud – Forum verschaffen Ihnen einen umfassenden Überblick zu den aktuellen gesetzlichen Neuerungen und unterstützen Sie dabei, Geldwäsche- und Betrugsstrukturen zu erkennen, zu bewerten und rechtzeitig zu verhindern. In den Compliance-Seminaren wie Compliance, Compliance für Vertriebsbeauftragte, Neue Compliance-Funktion gemäß MaRisk oder auch Compliance im Fokus der Bankenaufsicht werden Ihnen die Ausgestaltung der Schnittstellen zwischen Compliance, Datenschutz, IT, Zentrale Stelle und Interner Revision näher gebracht. Auch die Mindestanforderungen zum Aufbau eines Gesamt-IKS werden hier beispielsweise näher erläutert.

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