Financial Crime World

Title: Djibouti Cracks Down on Money Laundering: A Closer Look at AML-KYC Compliance in Djibouti

Overview

Djibouti, a small country located on the Horn of Africa, has implemented stringent regulations to combat money laundering and terrorist financing. This article provides an in-depth analysis of the Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements for identity verification in Djibouti.

Background

  1. Criminalization of Money Laundering
  2. Safeguards against Terrorist Financing
  3. Customer Screening, Identification, and Verification

##Scope

This section covers the essential identity verification requirements as per Djibouti’s regulations.

##Definitions

  • Client: Shufti Pro’s customer
  • Customer: The client’s end-user
  • Document Verification: The process of authenticating a government-issued identity document
  • Identity Verification: The process of confirming a client’s identity
  • Proof of Identity: A government-issued identity document
  • Enhanced Due Diligence (EDD): A process involving a higher level of scrutiny for potential business relationships
  • Third-Party Diligence: Outsourcing the due diligence process to an external party
  • Politically Exposed Person (PEP): An individual with a higher risk of involvement in bribery and corruption
  • Due Diligence: The measures taken to mitigate risks before entering agreements or carrying out financial transactions

Key Requirements for Identity Verification

  1. Last name and first name
  2. Date of birth
  3. Place of birth
  4. Identification data
  5. Address

Compliant AML Methods

  1. Independent sourced documents for end-user identity verification
  2. Photo-based biometric identification documents

Documents Required for Verification

Identity Verification

  1. Identity Card
  2. Passport
  3. Driving License

Address Verification

  1. Current utility bills
  2. Government department-issued documents
  3. Bank statements

Timing of Verification

  1. Onboarding new customers
  2. Transaction data verification
  3. Higher-risk situations

Politically Exposed Persons and EDD Measures

  1. Assessing customers for Politically Exposed Persons (PEPs)
  2. Foreign officials or those holding public offices
  3. AML Screening service

Relying on External Services

  1. Third-party diligence
  2. Regulatory compliance
  3. Fulfilling AML and KYC obligations

Record Retention

  1. Data retention for a minimum of five years
  2. Obtaining necessary data from third parties

Conclusion

Understanding the identity verification requirements in Djibouti’s regulations is crucial for businesses wanting to adhere to local and international laws. Thoroughly identifying customers and their addresses, as well as implementing enhanced due diligence measures for Politically Exposed Persons and utilizing third-party services, all contribute to a robust AML and KYC regime.