• FC-1.1 FC-1.1 General Requirements

    • Verification of Identity and Source of Funds

      • FC-1.1.1

        Conventional bank licensees must establish effective systematic internal procedures for establishing and verifying the identity of their customers and the source of their funds. Such procedures must be set out in writing and approved by the licensee's Board of Directors. They must be strictly adhered to.

      • FC-1.1.2

        Conventional bank licensees must implement the customer due diligence measures outlined in Chapters FC-1, FC-2 and FC-3 when:

        (a) establishing business relations with a new or existing customer;
        (b) a change to the signatory or beneficiary of an existing account or business relationship is made;
        (c) a significant transaction takes place;
        (d) there is a material change in the way that the bank account is operated or in the manner in which the business relationship is conducted;
        (e) customer documentation standards change substantially;
        (f) the conventional bank licensee has doubts about the veracity or adequacy of previously obtained customer due diligence information;
        (g) carrying-out one-off or occasional transactions above BD 6,000, or where several smaller transactions that appear to be linked fall above this threshold;
        (h) carrying out wire transfers irrespective of amount; or
        (i) there is a suspicion of money laundering or terrorist financing.

      • FC-1.1.3

        For the purposes of this Module, "customer" includes counterparties such as financial markets counterparties, except where financial institutions are acting as principals where simplified due diligence measures may sometimes apply. These simplified measures are set out in Section FC-1.11.

      • FC-1.1.4

        The BMA's specific minimum standards to be followed with respect to verifying customer identity and source of funds are contained in Section FC-1.2. Enhanced requirements apply under certain high-risk situations: these requirements are contained in Sections FC-1.3 to FC-1.8 inclusive. Additional requirements apply where a conventional bank licensee is relying on a professional intermediary to perform certain parts of the customer due diligence process: these are detailed in Section FC-1.9. Simplified customer due diligence measures may apply in defined circumstances: these are set out in Section FC-1.11.

    • Verification of Third Parties

      • FC-1.1.5

        Conventional bank licensees must obtain a signed statement from all new customers confirming whether or not the customer is acting on their own behalf or not. This undertaking must be obtained prior to conducting any transactions with the customer concerned.

      • FC-1.1.6

        Where a customer is acting on behalf of a third party, the conventional bank licensee must also obtain a signed statement from the third party, confirming they have given authority to the customer to act on their behalf. Where the third party is a legal person, the conventional bank licensee must have sight of the original Board resolution (or other applicable document) authorising the customer to act on the third party's behalf, and retain a certified copy.

      • FC-1.1.7

        Conventional bank licensees must establish and verify the identity of the customer and (where applicable) the party/parties on whose behalf the customer is acting, including the Beneficial Owner of the funds. Verification must take place in accordance with the requirements specified in this Chapter.

      • FC-1.1.8

        Where financial services are provided to a minor or other person lacking full legal capacity, the normal identification procedures as set out in this Chapter must be followed. In the case of minors, licensees must additionally verify the identity of the parent(s) or legal guardian(s). Where a third party on behalf of a person lacking full legal capacity wishes to open an account, the licensee must establish the identity of that third party as well as the intended account holder.

    • Anonymous and Nominee Accounts

      • FC-1.1.9

        Conventional bank licensees must not establish or keep anonymous accounts or accounts in fictitious names. Where conventional bank licensees maintain a nominee account, which is controlled by or held for the benefit of another person, the identity of that person must be disclosed to the conventional bank licensee and verified by it in accordance with the requirements specified in this Chapter.

    • Timing of Verification

      • FC-1.1.10

        Conventional bank licensees must not commence a business relationship or undertake a transaction with a customer before completion of the relevant customer due diligence measures specified in Chapters FC-1, FC-2 and FC-3. However, verification may be completed after receipt of funds in the case of non face-to-face business, or the subsequent submission of CDD documents by the customer after initial face-to face contact, providing that no disbursement of funds takes place until after the requirements of this Chapter have been fully met.

    • Incomplete Customer Due Diligence

      • FC-1.1.11

        Where a conventional bank licensee is unable to comply with the requirements specified in Chapters FC-1, FC-2 and FC-3, it must consider whether to terminate the relationship or not proceed with the transaction, and additionally, consider whether it should file a suspicious transaction report.

      • FC-1.1.12

        See also Chapter FC-5, which covers the filing of suspicious transaction reports.