Financial Crime World

Title: Bermuda’s Stringent KYC Regulations: Unraveling the Identity Verification Process

Introduction

In the complex world of financial transactions, Bermuda’s know-your-customer (KYC) and anti-money laundering (AML) regulations serve as critical safeguards to prevent illicit activities. This piece delves into the essential identity verification requirements under Bermuda’s KYC-AML regulations, based on the Proceeds of Crime (Anti-money Laundering and Anti-terrorist Financing) Regulations 2008.

Bermuda’s Comprehensive Framework

  • Creating an environment that criminalizes money laundering
  • Setting appropriate safeguards and guidelines
  • Mandatory procedures for customer screening, identification, and verification

Scope and References

  • Comprehensive understanding of AML and KYC procedures
  • Guidance from Bermuda Monetary Authority and the Proceeds of Crime (Anti-money Laundering and Anti-terrorist Financing) Regulations 2008

Key Definitions

  • Client: Shufti Pro’s customer
  • Customer: Client’s customer subjected to KYC-AML checks
  • End-user: Customer from Shufti Pro’s perspective
  • Document Verification: Process of verifying document authenticity
  • Identity Verification: Process of verifying an individual’s identity
  • Proof of Identity: Government-issued identity documents
  • Enhanced Due Diligence (EDD): Increased scrutiny of potential business relationships
  • Third-Party Diligence: Delegation of due diligence to external parties
  • Politically Exposed Person (PEP): Individuals with higher risk for potential involvement in bribery/corruption
  • Due Diligence: Risk mitigating measures taken before entering an agreement or transaction

Identification and Verification of Individuals in Bermuda

  • Mandatory identity attributes: name, place of birth, address
  • Compliant CDD methods for verification

Conducting Identity Verification Procedures

  • Essential documentation for verification
    • Passports
    • Driving licenses
    • Other valid photo IDs

Address Verification

  • Accepted proofs of address
    • Current utility bills
    • Government-issued documents
    • Bank statements

Timing of Verification

  • Multiple identity verifications required
  • Frequency depends on the entity’s specific needs and risks

Politically Exposed Persons (PEPs) and Enhanced Due Diligence (EDD)

  • Mandatory determination of PEP status
  • Utilizing Shufti Pro’s AML Screening service
  • Categorization of PEP risks and information on immediate family members or close associates

Relying on External Services

  • External third-party service provider
  • Collection of all necessary data (Diligence Information)

Record Retention

  • Retaining data for not less than five years
  • Gathering necessary information (Due Diligence Data) from third parties