IEIM403500 - Due Diligence: Special Due Diligence Rules: Reliance on Self-Certification

Due Diligence: Special Due Diligence Rules: Reliance on Self-Certification

Where information already held by a Financial Institution, including knowledge about the customer held by a relationship manager, conflicts with any statements or self-certification, or the Financial Institution has reason to know that the self-certification or other documentary evidence is incorrect, it may not rely on that evidence or self-certification.

A Financial Institution will be considered to have reason to know that a self-certification or other documentation associated with an account is unreliable or incorrect if, based on the relevant facts, a reasonably prudent person would know this to be the case [see IEIM403180].

Reliance upon an audited financial statement

Financial Institutions may rely upon an audited financial statement to establish that an Account Holder meets a certain income or asset threshold, but are not obliged to where the entity’s status can be established from other information or documentation that it holds).

If a Financial Institution does rely upon an audited financial statement to establish a status for an Account Holder, it has reason to know that the status claimed is unreliable or incorrect only if the audited financial statement for the Account Holder or the notes or footnotes to the financial statement conflicts with the self-certification provided to it.

If a Reporting Financial Institution relies upon an audited financial statement to establish a status for an Account Holder that does not require the Account Holder to meet an asset or income threshold, it will be required to review only the notes or footnotes to the financial statement to determine whether the financial statement supports the claimed status. If a Financial Institution does rely upon other documentation to establish the Account Holder’s status there is no need to review any financial statements that may have been provided to it as part of the account opening.

Reliance upon other documentation

Where a Financial Institution relies on organisational documents to establish that an Account Holder has a particular status, it will only be required to review the documents to the extent needed to establish that the requirements applicable to the particular status are met.