Financial Crime World

Lebanon’s AML/KYC Regulations: Identity Verification Requirements and Measures

Lebanon has implemented strict anti-money laundering (AML) and know your customer (KYC) regulations under the ‘Law No.44 of Fighting Money Laundering and Terrorist Financing,’ published in 2015. These regulations employ a risk-based approach and align with international standards and recommendations. This article provides an overview of the identity verification requirements and measures outlined in Lebanon’s AML/KYC regulations.

Definitions

  1. Client: A legal or natural person who uses Shufti Pro’s services.
  2. Customer: The client’s customer subjected to AML-KYC checks.
  3. End-user: The client’s customer from Shufti Pro’s perspective.
  4. Identity Verification: The process of authenticating an individual’s identity.
  5. Document Verification: The process of checking the authenticity of a government-issued identity document.

Identity Verification Requirements

Under Lebanese regulations, the following attributes are necessary for identifying an individual:

  1. Name
  2. Address

Compliant CDD Methods

Shufti Pro uses several methods to support clients in performing identity verification:

3.1 Document-based verification

Shufti Pro verifies the end-user’s identity based on documents such as:

  • Passport
  • Driver’s license
  • National identity card
  • Residence permit

3.2 Real-time audio-video transmission

Shufti Pro conducts a live, interactive video session between an identification expert and the end-user.

Documents Required for Verification

Proof of identity includes:

  • Valid passport
  • Valid driver’s license
  • National identity card
  • Residence permit

To confirm the address, clients can use:

  • Utility bills
  • Documents issued by a government department
  • Bank statements

Timing of Verification

Identity verification is not a one-time process. Clients must verify the identity of new customers:

  1. When they are onboarded
  2. At specific monetary thresholds defined by Lebanese regulations
  3. In high-risk situations

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

Clients must screen their customers against watchlists of global regulatory authorities, foreign and domestic databases, compromised PEPs, and sanctioned individuals. Shufti Pro’s AML Screening service conducts the screening process.

Reliance on External Services

Lebanese regulations permit clients to outsource due diligence processes to an external party like Shufti Pro. However, the primary liability remains with the client. Clients must collect all necessary due diligence information from the third party without undue delay.

Record Retention

As per Lebanese regulations, clients are required to retain relevant data, such as due diligence data, for a minimum of five (5) years. In cases where the data is processed, collected, or managed by a relevant third party, clients must collect the necessary data without undue delay.

As a trusted partner, Shufti Pro supports its clients in adhering to AML/KYC regulations. Our comprehensive services help streamline identity verification processes, ensuring compliance with the Lebanese legal framework.