Anti-Money Laundering and Countering the Financing of Terrorism
The Isle of Man has applied the "Know Your Customer" ("KYC") principle since 1985. More detailed provisions are now in place to determine how customers and clients are adequately identified and their identity verified. For full details of the Isle of Man Government’s commitment to combating Money Laundering and the Financing of Terrorism and Proliferation please see the following link.
KYC is a convenient term to describe the process of obtaining, retaining and using information about a customer such that his identity and residential address are verified, the source of his funds and wealth are understood, his financial circumstances are understood, and the nature of the transactions he undertakes are understood in the context of his known personal circumstances and activities. Similar concepts apply to corporate, trust and other business, modified accordingly. Increasingly the term "Customer Due Diligence" ("CDD") is being used to represent the same concepts.
Under the Money Laundering and Terrorist Financing Code 2013 (“the Code”) every licenceholder must conduct CDD on a risk based approach, have a Money Laundering Reporting Officer, maintain appropriate procedures and controls to deal with Politically Exposed Persons, conduct ongoing maintaining of business relationships, keep adequate records and have effective staff training in this area. The definition of business caught by the Codes goes much wider than financial services and includes Estate Agents, Bookmakers, Casinos and Local Authorities amongst others. For full details of which businesses are covered by the Code please see Schedule 4 of the Proceeds of Crime Act 2008.
The Commission has issued an AML/CFT Handbook of guidance for licenceholders on anti-money laundering and countering the financing of terrorism explaining how the Commission would expect institutions to fulfil their responsibilities under the legislation. In order to assist licenceholders to fulfil their training obligations under the Code the Commission arranges, from time to time, Anti-Money Laundering and Countering the Financing of Terrorism seminars.