COVID-19 customer identification

AUSTRAC has amended the AML/CTF Rules to provide for alternative customer identification procedures during the COVID-19 pandemic.

If a reporting entity is unable to identify a customer because the customer is unable to produce or provide the necessary information or evidence of identity that the customer possesses due to COVID-19 pandemic measures, the reporting entity may use alternative identity proofing processes, in accordance with its risk-based systems and controls. This could include, for example, accepting multiple types of secondary identification documents when normally a primary identification document would be required.

If the reporting entity is unable to establish the identity of a customer using such processes, it may accept a self-attestation from the customer certifying that the information provided in relation to the customer’s identity is correct. However a reporting entity must not rely on a self-attestation if it knows or has reason to believe that it is incorrect or misleading, and it must apply appropriate levels of ongoing customer due diligence to deal with money laundering and terrorism financing risk associated with customer identities established using self-attestation.

When a reporting entity’s customer identification procedures require it to verify information based on the original, certified copy or certified extract of a document, but it cannot do this because of COVID-19 pandemic measures, the rules amendment allows for the reporting entity to rely on a copy of the document, in accordance with its risk-based systems and controls.

The rules amendments define “COVID-19 pandemic measures” as any measures implemented or recommended by an Australian government body, or any reasonable measures adopted by a reporting entity or other person, in each case to prevent the spread of COVID-19. This would include reasonable measures adopted in a foreign country where a person is located.

Patrick Dwyer and Kathleen Harris

Legal Directors