Hong Kong Regulator Relaxes Bank Account Opening KYC

CENTRAL, Hong Kong - Oct. 24, 2017 - PRLog -- The Hong Kong Monetary Authority (HKMA) has been reviewing the anti-money laundering and counter-financing of terrorism (AML/CFT) regulatory requirements for banks, including the address verification requirements stipulated in the current AML Guideline and concluded to remove the address verification requirements. As a result, banks are only required to collect address information of customers and/or beneficial owners without the need to collect documentary evidence for AML/CFT purpose.

This amendment is expected to be gazetted in 2018 together with the amendments resulting from the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) (Amendment) Bill 2017 (the Bill).

In the meantime, any absence of verification of address will be regarded as justified and the HKMA called on Financial Institutions (FI) to start reviewing and to adopt the changes as soon as it is practicable to do so.

The old and new KYC requirements are summarized below:

Old

An FI should obtain and verify the following information in relation to a customer which is a corporation:
(a) full name;
(b) date and place of incorporation;
(c) registration or incorporation number; and
(d) registered office address in the place of incorporation.
If the business address of the customer is different from the registered office address in (d) above, the FI should obtain information on the business address and verify as far as practicable.

New

FIs are required to collect the registered address and principal place of business only.

Old

FIs should verify the company's registered office address in the place of incorporation.

New

To be repealed.

Old

For beneficial owners, FIs should obtain the residential address (and permanent address if different) and may adopt a risk-based approach to determine the need to take reasonable measures to verify the address, taking account of the number of beneficial owners, the nature and distribution of the interests in the entity and the nature and extent of any business, contractual or family relationship.

New

FIs are required to collect the residential address of beneficial owners.

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