Document ID: chunk:federal_register_of_legislation:F2024C01198:body:0:p117
Version: federal_register_of_legislation:F2024C01198
Segment Type: other
Provision Reference: 
Character Range: 327560–330579

risk-based systems and controls to identify, manage and mitigate the ML/TF risk it faces in providing the designated service to the transferring customers as a group; and

             (c) based on the assessed ML/TF risk and its risk-based systems and controls, it is reasonable for it to either:

                  (i) rely upon the applicable customer identification procedure of reporting entity one as an appropriate means to identify and verify the identification of a transferring customer; or

                  (ii) treat a transferring customer who was a pre-commencement customer of reporting entity one as if the customer was a pre-commencement customer of reporting entity two.

     28.4 Reporting entity two must, within 14 days after any of the circumstances specified in paragraph 28.5 comes into existence, take one or more of the actions specified below:

          (1) carry out the applicable customer identification procedure, unless reporting entity two has previously carried out that procedure or a comparable procedure; or

          (2)  collect any KYC information in respect of the customer; or

          (3)  verify, from a reliable and independent source, KYC information that has been obtained in respect of the customer, as is appropriate to the ML/TF risk relevant to the provision of the designated service by reporting entity two;

     for the purpose of enabling reporting entity two to be reasonably satisfied that the customer is the person that he or she claims to be.

     28.5 For the purposes of paragraph 28.4 the following circumstances are specified:

          (1)  a suspicious matter reporting obligation arises in relation to a transferring customer; or

          (2)  reporting entity two reasonably suspects that reporting entity one did not carry out the applicable customer identification procedure when required; or

          (3)  a significant increase has occurred in the level of ML/TF risk as assessed under the AML/CTF program of reporting entity two, in relation to the provision of a designated service by reporting entity two to a transferring customer.

     28.6 In this Chapter:

          (1) 'reporting entity one' means the reporting entity that either:

             (a) assigns, conveys, sells or transfers a whole or a part of the business; or

             (b) is to transfer, or has transferred, all or part of its assets or liabilities pursuant to Part 3 of the FSA;

          (2) 'reporting entity two' means the reporting entity to which reporting entity one either:

             (a) assigns, conveys, sells or transfers a whole or a part of the business, excluding compulsory transfers of business effected pursuant to Part 4 of the FSA; or

             (b) is to transfer, or has transferred, all or part of its assets or liabilities pursuant to Part 3 of the FSA;

          (3) 'transferring customer' means a customer who is a customer of reporting entity two in relation to a designated service solely because