To ask Her Majesty's Government what assessment they have made of whether retail banks are conducting sufficient checks on the credentials of people seeking to open an account.
25 January 2018
Retail banks have comprehensive obligations when it comes to identifying customers at the start of a business relationship. The Money Laundering Regulations 2017 set out the requirements and further guidance is provided to retail banks through the Joint Money Laundering Steering Group’s Guidance, which is approved by HM Treasury. UK Customer Due Diligence Requirements reflect the global standards agreed by the Financial Action Task Force and are provided for in European legislation through the Fourth Money Laundering Directive. The FCA use a risk-based approach to supervise retail banks’ compliance with the Money Laundering Regulations, including their adherence to the requirements for customer identification.
In addition, the Immigration Act 2014 prohibits banks and building societies from opening current accounts for people who are known not to have leave to remain in or to enter the UK. To ensure they are complying with the Act, banks and building societies can carry out an immigration status check with a specified anti-fraud organisation or data-matching authority (CIFAS).