Money Laundering Regulations 2017—client due diligence—law firms
Money Laundering Regulations 2017—client due diligence—law firms

The following Practice Compliance guidance note provides comprehensive and up to date legal information covering:

  • Money Laundering Regulations 2017—client due diligence—law firms
  • CDD triggers
  • What is CDD?
  • Identification of client and verification of their identity
  • Purpose and intended nature of the business relationship
  • CDD and existing clients
  • Applying CDD measures
  • Timing of CDD
  • Requirement to report discrepancies in registers
  • Evidence of identity
  • more

This Practice Note provides guidance on client due diligence (CDD) which is a central pillar of the anti-money laundering (AML) and counter-terrorist financing (CTF) regime. CDD requirements underpin the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), SI 2017/692, as amended by the Money Laundering and Terrorist Financing (Amendment) Regulations 2019, SI 2019/1511 from 10 January 2020.

Where the MLR 2017 apply, conducting CDD is an absolute requirement. It is not in itself subject to the risk-based approach. Certain components of CDD however, allow for flexibility and positively require risk assessment.

CDD triggers

You must apply CDD measures when you:

  1. establish a business relationship

  2. carry out an occasional transaction:

    1. that amounts to a transfer of funds within the meaning of Article 3.9 of the Funds Transfer Regulation exceeding €1,000, or

    2. that amounts to €15,000 or more, whether executed in a single operation or in several operations which appear to be linked

  3. suspect money laundering or terrorist financing, or

  4. doubt the veracity or adequacy of documents or information previously obtained for the purposes of identification or verification

See also: CDD and existing clients below, and for the timing of CDD, see: Timing.

Conducting CDD for work not caught by the MLR 2017

The obligation to perform CDD is contained in the MLR 2017 which apply