What CDD challenges are presented by coronavirus (COVID-19)?

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Published on LexisPSL on 12/11/2020

The following Practice Compliance Q&A provides comprehensive and up to date legal information covering:

  • What CDD challenges are presented by coronavirus (COVID-19)?
  • CDD requirements
  • E-verification
  • Unable to complete CDD measures
  • Warning signs
  • SRA requirement to identify your client

What CDD challenges are presented by coronavirus (COVID-19)?

STOP PRESS: Draft Legal Sector Affinity Group (LSAG) AML guidance was published on 20 January 2021. It awaits approval by HM Treasury and any content may be amended before the final version is published with the Treasury's approval. This document reflects HM Treasury approved LSAG AML guidance published in 2018 and will be updated in due course.

Now more than ever the majority, if not all, of us are working from home due to the coronavirus (COVID-19) outbreak. Identifying your client and verifying their identity is still just as important and a key part of the client due diligence (CDD) process.

Criminals continue to operate and look to take advantage during this outbreak. So it is important everyone is aware of the changing risks.

The Legal Sector Affinity Group (LSAG) has issued detailed guidance on dealing with anti-money laundering compliance during the coronavirus pandemic.

CDD requirements

The exact measures you must take will vary from case to case and will depend on your assessment of the risk arising in the circumstances.

Not meeting a client in person is identified in the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), SI 2017/692 as a risk factor, and so this would normally (but not always) warrant enhanced due diligence (EDD).

When assessing risk, you must take into account

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