I have an appointment this afternoon with a potential new client, who is a limited company.
I have a some small Ltd clients already, and have had no problems with ID as they are director/ owner, and I have seen all the necessary company formation docs etc, plus as they are at most 2 directors, I have obtained personal ID as well. Much like I would if it were a sole trader/ partnership
This potential client however, is much larger with (as far as I can tell from a quick Duedil search) seven directors (some not based in the area), and as yet an unknown number of share holders, who may, or may not be the directors.
Obviously I need to do my due diligence but I have been checking through the MLR manual, I am not sure that I understand the exact requirements for a company. It basically says that I need to confirm it is a real company (cert of incorporation, other docs etc), and identify who are the directors and shareholder. What I am not clear on, is whether it is necessary to obtain physical ID for the individuals.
From what I can glean, it is not necessary to have physical evidence of the identities of the individuals, just to know who they are (working through non human benificiaries, such as holding companies to the actual human).
Looking at other regulated industries (banks), and looking at what they require to open a Ltd Co bank account, seems to confirm what I am thinking.
I have an appointment this afternoon with a potential new client, who is a limited company.
I have a some small Ltd clients already, and have had no problems with ID as they are director/ owner, and I have seen all the necessary company formation docs etc, plus as they are at most 2 directors, I have obtained personal ID as well. Much like I would if it were a sole trader/ partnership
This potential client however, is much larger with (as far as I can tell from a quick Duedil search) seven directors (some not based in the area), and as yet an unknown number of share holders, who may, or may not be the directors.
Obviously I need to do my due diligence but I have been checking through the MLR manual, I am not sure that I understand the exact requirements for a company. It basically says that I need to confirm it is a real company (cert of incorporation, other docs etc), and identify who are the directors and shareholder. What I am not clear on, is whether it is necessary to obtain physical ID for the individuals.
From what I can glean, it is not necessary to have physical evidence of the identities of the individuals, just to know who they are (working through non human benificiaries, such as holding companies to the actual human).
Looking at other regulated industries (banks), and looking at what they require to open a Ltd Co bank account, seems to confirm what I am thinking.
Just wondering what others think
Bill
I know that for my own father I had to get proof of identity because he owned more than 25% of the shares in the family company - even though he has nothing to do with the running of the company.
__________________
Never buy black socks from a normal shop. They shaft you every time.
That was my original understanding but having reread the regs, I feel that it may not actually be necessary.
If you read what is necessary for soletraders, it specifically states that proof of identity is required but for a ltd company it just say identify who the share holders are, if they own 25% shares. Like I said, banks do not seem to require that a ltd company comes in armed with photocopies of driving licences, passports, utility bills for 10+ individuals
My limited companies are just baby one's but, like yourself, my understanding is that the principles are exactly the same in that you need evidence that the directors / shareholders are who they say they are.
Sure that you've checked them out already but just put the company name in here for a full current list of who you need evidence of :
http://companycheck.co.uk/search.php
And then click on the directors and shareholders to check out there other directorships and file that away with you KYC info.
For the actual physical information here is the guidance from the law society on KYC :
Specifically this part in relation to private and unlisted companies in the UK
Private companies are generally subject to a lower level of public disclosure than public companies. In general however, the structure, ownership, purposes and activities of many private companies will be clear and understandable.
The standard identifiers for private companies are:
full name business / registered address names of two directors, or equivalent nature of business
Other sources for verifying corporate identification may include:
certificate of incorporation details from the relevant company registry, confirming details of the company and of the director, including the director's address filed audited accounts information from a reputable electronic verification service provider
Sure that you know all this already but I just go into autopilot sometimes!
Shaun.
P.S. Companycheck and directorcheck are really, really slow today and the connection has timed out on me more than once but try and bear with it. It is definitely much easier to check people / companies out in the middle of the night! (as I say, shame you didn't ask this yesterday).
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
P.S. Companycheck and directorcheck are really, really slow today and the connection has timed out on me more than once but try and bear with it.
They have a new website launching in 1 hour 53 minutes - maybe there is a connection. Also, for a lot of companies I was unable to download the actual pdf accounts, hopefully with the new website this will change.
__________________
Never buy black socks from a normal shop. They shaft you every time.
Money Laudering Regulations say that for a limited company you need to identify the client so this is the check that the company is the company. Next is to identify the beneficial owners which for limited companies is usually seen as anyone with more than 25% of shares or voting rights or someone who has control over the management of the company. Then the final bit is to confirm the nature of business.
I did some work for a bank and they wanted to collect id verification for anyone who have more than 5% shares. The way they did this was by bringing in an electronic ID system so they didn't have to chase the paper document.
