www.pwc.co.uk Know Your Customer: Quick Reference Guide Anti-Money Laundering Understanding global KYC differences April 2012 Anti-Money Laundering Know Your Customer: Quick Reference Guide Understanding global KYC differences Combating Money Laundering continues to be a key issue for Please rollover map to select your region then click to select country of choice many businesses. Tackling the complex international patchwork of regulatory and legal requirements, while continuing to serve clients locally, is challenging. The financial services sector faces significant reputational damage and potentially large fines if adequate controls do not exist. Around the world, regulators are taking an increasingly aggressive stance on failures in this area. Quick and easy access to global Anti-Money Laundering (‘AML’) and ‘Know Your Customer’ (‘KYC’) information is helpful to mitigating risk. In response, we have developed a Know Your Customer quick reference guide. It incorporates the main local AML requirements for over 70 different countries. In addition to new countries being included in the 2012 Know Your Customer quick reference guide, there are also additional questions on the topic of reporting requirements. These include details of whom to report suspicious activity to within the various territories, reporting obligations and any penalties for non compliance. The guide details many regulatory and other cultural issues which need to be addressed when doing business across territories. Useful links to Financial Action Task Force (‘FATF’) reports and country evaluations are also included. Information about whether local regulators support the use of the risk based approach to AML; how to deal with Politically Exposed Persons (‘PEPs’) and whether doing business with shell banks is prohibited can all be found in our guide. From time to time, you may need expert advice from AML specialists. We’ve included details of the appropriate PwC AML professionals in the countries featured. They would be happy to discuss any AML issues you might have. Anti-Money Laundering Know Your Customer: Quick Reference Guide Understanding global KYC differences Combating Money Laundering continues to be a key issue for many businesses. Tackling the complex international patchwork of regulatory and legal requirements, while continuing to serve clients locally, is challenging. The financial services sector faces significant reputational damage and potentially large fines if adequate controls do not exist. Around the world, regulators are taking an increasingly aggressive stance on failures in this area. Quick and easy access to global Anti-Money Laundering (‘AML’) and ‘Know Your Customer’ (‘KYC’) information is helpful to mitigating risk. In response, we have developed a Know Your Customer quick reference guide. It incorporates the main local AML requirements for over 70 different countries. In addition to new countries being included in the 2012 Know Your Customer quick reference guide, there are also additional questions on the topic of reporting requirements. These include details of whom to report suspicious activity to within the various territories, reporting obligations and any penalties for non compliance. The guide details many regulatory and other cultural issues which need to be addressed when doing business across territories. Useful links to Financial Action Task Force (‘FATF’) reports and country evaluations are also included. Information about whether local regulators support the use of the risk based approach to AML; how to deal with Politically Exposed Persons (‘PEPs’) and whether doing business with shell banks is prohibited can all be found in our guide. Europe From time to time, you may need expert advice from AML Austria Germany Isle of Man Poland Switzerland specialists. We’ve included details of the appropriate PwC AML professionals in the countries featured. They would be happy to Belgium Gibraltar Italy Portugal Turkey discuss any AML issues you might have. Czech Republic Greece Jersey Romania UK Denmark Guernsey Luxembourg Russia Finland Hungary Netherlands Spain France Ireland Norway Sweden Anti-Money Laundering Know Your Customer: Quick Reference Guide Understanding global KYC differences Combating Money Laundering continues to be a key issue for many businesses. Tackling the complex international patchwork of regulatory and legal requirements, while continuing to serve clients locally, is challenging. The financial services sector faces significant reputational damage and potentially large fines if adequate controls do not exist. Around the world, regulators are taking an increasingly aggressive stance on failures in this area. Quick and easy access to global Anti-Money Laundering (‘AML’) and ‘Know Your Customer’ (‘KYC’) information is helpful to mitigating risk. In response, we have developed a Know Your Customer quick reference guide. It incorporates the main local AML requirements for over 70 different countries. In addition to new countries being included in the 2012 Know Your Customer quick reference guide, there are also additional questions on the topic of reporting requirements. These include details of whom to report suspicious activity to within the various territories, reporting obligations and any penalties for non compliance. The guide details many regulatory and other cultural issues which need to be addressed when doing business across territories. Useful links to Financial Action Task Force (‘FATF’) reports and country evaluations are also included. Information about whether local regulators support the use of the risk based approach to AML; how to deal with Politically Exposed Persons (‘PEPs’) and whether doing business with shell banks is prohibited can all be found in our guide. Americas From time to time, you may need expert advice from AML specialists. We’ve included details of the appropriate PwC AML professionals in the countries featured. They would be happy to discuss any AML issues you might have. Anti-Money Laundering Know Your Customer: Quick Reference Guide Understanding global KYC differences Combating Money Laundering continues to be a key issue for many businesses. Tackling the complex international patchwork of regulatory and legal requirements, while continuing to serve clients locally, is challenging. The financial services sector faces significant reputational damage and potentially large fines if adequate controls do not exist. Around the world, regulators are taking an increasingly aggressive stance on failures in this area. Quick and easy access to global Anti-Money Laundering (‘AML’) and ‘Know Your Customer’ (‘KYC’) information is helpful to mitigating risk. In response, we have developed a Know Your Customer quick reference guide. It incorporates the main local AML requirements for over 70 different countries. In addition to new countries being included in the 2012 Know Your Customer quick reference guide, there are also additional questions on the topic of reporting requirements. These include details of whom to report suspicious activity to within the various territories, reporting obligations and any penalties for non compliance. The guide details many regulatory and other cultural issues which need to be addressed when doing business across territories. Useful links to Financial Action Task Force (‘FATF’) reports and country evaluations are also included. Information about whether local regulators support the use of the risk based approach to AML; how to deal with Politically Exposed Persons (‘PEPs’) and whether doing business with shell banks is prohibited can all be found in our guide. Africa From time to time, you may need expert advice from AML specialists. We’ve included details of the appropriate PwC AML professionals in the countries featured. They would be happy to discuss any AML issues you might have. Anti-Money Laundering Know Your Customer: Quick Reference Guide Understanding global KYC differences Combating Money Laundering continues to be a key issue for many businesses. Tackling the complex international patchwork of regulatory and legal requirements, while continuing to serve clients locally, is challenging. The financial services sector faces significant reputational damage and potentially large fines if adequate controls do not exist. Around the world, regulators are taking an increasingly aggressive stance on failures in this area. Quick and easy access to global Anti-Money Laundering (‘AML’) and ‘Know Your Customer’ (‘KYC’) information is helpful to mitigating risk. In response, we have developed a Know Your Customer quick reference guide. It incorporates the main local AML requirements for over 70 different countries. In addition to new countries being included in the 2012 Know Your Customer quick reference guide, there are also additional questions on the topic of reporting requirements. These include details of whom to report suspicious activity to within the various territories, reporting obligations and any penalties for non compliance. The guide details many regulatory and other cultural issues which need to be addressed when doing business across territories. Useful links to Financial Action Task Force (‘FATF’) reports and country evaluations are also included. Information about whether local regulators support the use of the risk based approach to AML; how to deal with Politically Exposed Persons (‘PEPs’) and whether doing business with shell banks is prohibited can all be found in our guide. Middle East From time to time, you may need expert advice from AML Bahrain Israel Lebanon Oman Qatar UAE specialists. We’ve included details of the appropriate PwC AML professionals in the countries featured. They would be happy to discuss any AML issues you might have. Anti-Money Laundering Know Your Customer: Quick Reference Guide Understanding global KYC differences Combating Money Laundering continues to be a key issue for many businesses. Tackling the complex international patchwork of regulatory and legal requirements, while continuing to serve clients locally, is challenging. The financial services sector faces significant reputational damage and potentially large fines if adequate controls do not exist. Around the world, regulators are taking an increasingly aggressive stance on failures in this area. Quick and easy access to global Anti-Money Laundering (‘AML’) and ‘Know Your Customer’ (‘KYC’) information is helpful to mitigating risk. In response, we have developed a Know Your Customer quick reference guide. It incorporates the main local AML requirements for over 70 different countries. In addition to new countries being included in the 2012 Know Your Customer quick reference guide, there are also additional questions on the topic of reporting requirements. These include details of whom to report suspicious activity to within the various territories, reporting obligations and any penalties for non compliance. The guide details many regulatory and other cultural issues which need to be addressed when doing business across territories. Useful links to Financial Action Task Force (‘FATF’) reports and country evaluations are also included. Information about whether local regulators support the use of the risk based approach to AML; how to deal with Politically Exposed Persons (‘PEPs’) and whether doing business with shell banks is prohibited can all be found in our guide. Asia/Pacific From time to time, you may need expert advice from AML Austrailia India Malaysia Philippines Taiwan specialists. We’ve included details of the appropriate PwC AML professionals in the countries featured. They would be happy to China Indonesia New Zealand Singapore Thailand discuss any AML issues you might have. Hong Kong Japan Pakistan South Korea Vietnam Questions and Answers: ‘Know Your Customer’ quick reference guide Country by country comparison of high level Know Your Customer and Anti-Money Laundering information Zambia Key contact: Nasir Ali Postal address: Stand No. 2374 Last updated: Email: [email protected] Thabo Mbeki Road January 2012 Tel: +260 211 256471/2 P.O Box 30942, Lusaka, Zambia General Q1. In what year did the relevant AML laws and regulations become effective? A1. 2001 (Prohibition & Prevention of Money Laundering Act), 2010 (Prohibition & Prevention of Money Laundering (Amendment) Act # 44 2004 (Bank of Zambia Anti-Money Laundering Directives) and the Financial Intelligence Centre Act 2010. Q2. I f the AML laws and/or regulations became effective in the last 2 years, what were the requirements of the previous AML regime? A2. N /A. Q3. W ho is the regulator for AML controls for: (a) Banking; (b) Other financial Services; (c) Non financial sector (e.g. casinos, high value goods etc.). Please include link to the regulator(s) website A3. B ank of Zambia - http://www.boz.zm/ Pensions and Insurance Authority – www.pia.org.zm Q4. I s there any practical guidance provided to firms by public authorities regarding AML requirements, beyond the FATF recommendations and local legislation? Please include link to website, where available. A4. N o. Q5. I s there a requirement to retrospectively verify the identity of customers before the date the new AML regime was introduced? A5. N o. Q6. I s a risk based approach approved by the local regulator(s)? A6. Y es. Q7. H as the country been the subject of a FATF (or FATF-style) Mutual Evaluation or IMF assessment exercise in the last three years? If yes, please find a link to a relevant report (if publicly available). A7. h ttp://www.imf.org/external/pubs/ft/scr/2010/cr1017.pdf . This publication has been prepared for general guidance on matters of interest for the personal use of the reader, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. The application and impact of laws can vary widely based on the specific facts involved. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and ©ag 2e0n1ts2 dPow nCo. tA allc rcigehptts o rre assesrvuemde. Naonty floiar bfuilirttyh,e rre dsipsotrnibsuibtiiolitny worit hdouutyt othf ec apreer mfoisr sainoyn coof nPsweCqu. e“PnwceCs” o rfe yfeorus otor tahney onnetew eolrske oafc mtinegm, boer rr efifrrmaisn oinfg P troic aecwt,a tine rrheoliuasnecCeo oonp tehres Iinntfeorrnmaatitoionna lc Loinmtaitiende d(P iwn CthILis) , or, as the cpounbtleicxat trioeqn uoirre fso,r inadniyv iddeucails mioenm bbaeser dfir omns ito. f the PwC network. Each member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide any services to clients. PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or bind them in any way. No member firm is r©es 2p0o0n9s iPblreic oerw liaatbelreh ofours tehCe oaocptse rosr. oAmll irsigsihotnss r eosf earnvye do.t h“Perr imceewmabteerrh fiorums enCoro coapne rist ”c roenfetrrosl ttoh et heex enrectiwseo rokf oafn motehmerb mere fmirmbesr ofifr m ’s professional judgment or bind another member firm or PwCIL in any way. PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity. Design & Media – The Studio 21115 (04/12) Q uestions and Answers: ‘Know Your Customer’ quick reference guide Country by country comparison of high level Know Your Customer and Anti-Money Laundering information Customer due diligence Q8. A re there minimum transaction thresholds, under which customer due diligence is not required? If Yes, what are the various thresholds in place? A8. There are no minimum transaction thresholds, under which customer due diligence is not required. Q9. W hat are the high level requirements for verification of customer identification information (individuals and legal entities)? A9. I ndividuals: A Zambian national has to present a national registration card or a valid passport or driving licence. In the case of a foreign national, a national registration card and a valid passport (and where applicable, an issued visa). Legal entities: Verify the identity of the directors, beneficial owners and management i.e. obtain Certificate of Incorporation or equivalent and details of the registered office/place of business; details of the nature of their business; the reason for the account being opened; indication of the expected turnover; the source of funds and a copy of the last available accounts where applicable. The Financial Intelligence Centre Act stipulates that: A reporting entity shall, with respect to each customer obtain and verify the following: a) For a natural person, the full name and address and date of birth and place of birth, b) For a legal entity, the corporate name, the head office address, identities of directors, proof of incorporation or similar evidence of legal status and legal form, provisions of governing the authority to bind the legal person, and such information as is necessary to understand the ownership and the control of the legal person, c) For legal arrangement, the name address of the trustees, the settler and the beneficiary of express trusts, and any other parties with the authority to manage, vary or otherwise control the arrangement d) In addition to the identity of a customer, the identity of any person acting on behalf of the customer, including evidence that such person is properly authorised to act in that capacity, e) Information on the intended purpose and nature of each business relationship; and f) Sufficient information about the nature and business of the customer to permit the reporting entity to fulfil its obligations under the Act. Q10. W here copies of identification documentation are provided, what are the requirements around independent verification or authentication? A10. C ertification of relevant identification copies by a Commissioner of Oaths. Q11. W hat are the high level requirements around beneficial ownership (identification and verification)? A11. R egulated institutions should identify the beneficial owner of an account (regardless of whether it is a corporate body or trust opening the account) and if it fails to ascertain the identity of the said owner or person, it should make a report to the AML Investigations Unit. The Financial Intelligence Centre Act stipulates that a reporting entity shall identify the beneficial owner and shall take reasonable measures to verify the identity of the beneficial owner unless the Minister prescribes the circumstances, such as the ownership of publicly held corporations, in which such identification and verification is not necessary. Q12. I n what circumstances are reduced/simplified due diligence arrangements available? A12. F or regulated institutions, the circumstances are to be determined by the regulated institution and approved by Bank of Zambia. . This publication has been prepared for general guidance on matters of interest for the personal use of the reader, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. The application and impact of laws can vary widely based on the specific facts involved. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.  © 2009 PricewaterhouseCoopers. All rights reserved. “PricewaterhouseCoopers” refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity. Questions and Answers: ‘Know Your Customer’ quick reference guide Country by country comparison of high level Know Your Customer and Anti-Money Laundering information Q13. I n what circumstances are enhanced customer due diligence measures required? A13. I n the case of trusts and internet banking. Also in circumstances of suspicion as stated below: a) suspicious customer behaviour; b) suspicious customer identification circumstances; c) suspicious cash transactions; d) suspicious wire transfer transactions; e) suspicious safe deposit area activity; f) suspicious activity in credit transactions; g) suspicious commercial account activity; h) suspicious trade financing transactions; i) suspicious investment activity; and j) suspicious deposits. Q14. I n what circumstances is additional due diligence required for Politically Exposed Persons (‘PEPs’)? A14. T he circumstances are to be determined by the regulated institution and approved by Bank of Zambia. Q15. W hat enhanced due diligence must be performed for correspondent banking relationships (cross-border banking and similar relationships)? A15. A financial institution shall require its foreign branches and majority owned subsidiaries to implement the requirements to the extent that the domestic applicable laws of the host country so permit. Where the laws of the country in which its branch or majority owned subsidiary is situated prevent compliance with the obligations stipulated, institutions must advise its supervisory authority, which may take such steps as it believes to be appropriate to accomplish purposes of the Act. Q16. A re relationships with shell banks specifically prohibited? A16. Y es, the Financial Intelligence Centre Act stipulates that a shell bank shall not be established or permitted to operate in or through the territory of Zambia. Q17. I n what circumstances is additional due diligence required for non face-to-face transactions and/or relationships? A17. T he standard due diligence procedure of identification and verification applies for non face-to-face transactions and/or relationships. Financial Intelligence Centre Act states that where any business relationship or execution of transactions is made with a customer that is not physically present, the following is required for purposes of identification: a) Take adequate measures to address the specific risk of money laundering, financing of terrorism and any other serious offence; b) Ensure that the due diligence conducted is no less effective than where the customer appears in person; and c) Require additional documentary evidence or supplementary measures to verify or certify the documents supplied by the customer, or confirmatory certification from financial institutions or other documentary evidence or measure may be prescribed. Reporting Q18. T o whom are Suspicious Activity Reports (SARs) made? Please include a link to their website. A18. S uspicious Activity reports are made to the Anti Money Laundering Investigations Unit and for financial institutions the Financial Intelligence Centre Q19. W hat was the volume of SARs made to the authorities in the most recent year? Please state the GDP for the equivalent year. A19. I nformation on the volume of SARs is not publicly available. . T his publication has been prepared for general guidance on matters of interest for the personal use of the reader, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. The application and impact of laws can vary widely based on the specific facts involved. No representation or warranty (express orQ imp2lie0d). i s gA iveren atsh teor teh ea ancycu orabcyli gora ctoiomnpsle tteon ersesp oof rtht ea innfyortmhiantigon m coonrtaein tehda inn t hsius spupbicliciaotuiosn , tarnadn, stoa tcheti oexntsen et p.ger.m uitnteud sbuy alalw t,r aPrnicseawcatteiorhnosu,s ecCaosohpe trrsa LnLsPa, ictst imoenmsb aerbs,o evmep laoy ceeesr taanidn agents do not athccreepst hoor aldss, uimntee arnnya litaiobinlitay,l rwesiproen stribailnitys ofer rdsu,ty o otfh cearre tfroar nansya ccotniosenqsu eentcce.s? o f you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.  © 2009 PricewaterhouseCoopers. All rights reserved. “PricewaterhouseCoopers” refers to the network of member firms of A20. N o there is no obligation to report anything more than suspicious transactions – please see response to Q13. PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity. Financial institutions are obliged to report where there is suspicion or reasonable grounds to suspect that any property is the proceeds of crime, or is related to or linked to, or is to be used for terrorism, terrorist acts or by terrorist organisations or persons who financed terrorism. Q21. A re there any de-minimis thresholds below which transactions do not need to be reported? A21. N o Q22. A re there any penalties for non compliance with reporting requirements e.g. tipping off? A22. A ny person who knows or suspects that an investigation into money laundering has been, is being or is about to be conducted, without lawful authority, divulges that fact or information to another person, shall be guilty of an offence and shall be liable, upon conviction, to a fine not exceeding one hundred and thirty-nine thousand penalty units (approximately ZMK25,020,000) or to imprisonment for a term not exceeding five years or to both. Financial Intelligence Centre act states that the penalties for tipping off upon convictions shall be liable to a fine not exceeding five hundred thousand penalty units (approximately ZMK90,000,000) or to imprisonment for a period not exceeding five years, or to both. A person who intentionally fails to submit a report to the Centre commits an offence and is liable, upon conviction to a fine not exceeding seven hundred thousand penalty units (approx ZMK126,000,000) or to imprisonment for a period not exceeding seven years, or to both. Q23. A re there any requirements (legal or regulatory) to use automated Suspicious Transaction monitoring technology? A23. N o Q24. I s there a requirement to obtain authority to proceed with a current/ongoing transaction that is identified as suspicious? A24. T he regulated institution shall report to the AML Investigations Unit where the identity of the persons involved, the circumstances of any business transaction or where any cash transaction, gives any officer or employee of the regulated institution reasonable grounds to believe that a money laundering offence is being, has been or is about to be committed. Per the Financial Intelligence Centre acts – a financial institution shall refrain from carrying out a transaction which it suspects to be related to the money laundering, financing of terrorism or any other serious offence. Q25. D oes the local legislation allow transactions to be monitored outside the jurisdiction? A25. A lthough the local legislation does not specify this, one of the mandates of the Anti Money Laundering Investigations Unit is to cooperate with law enforcement agencies and institutions in other jurisdictions responsible for investigation and prosecution of money laundering offences. . This publication has been prepared for general guidance on matters of interest for the personal use of the reader, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. The application and impact of laws can vary widely based on the specific facts involved. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.  © 2009 PricewaterhouseCoopers. All rights reserved. “PricewaterhouseCoopers” refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.