Terms & Conditions
METHODOLOGY FOR KNOW YOUR SPONSOR, NEW MEMBERS (KYC), ANTI-MONEY LAUNDERING (AML) AND SANCTIONS SCREENING OF THE
ASSOCIATION European Compliance Professionals Association
I. INTRODUCTION
1. This AML/KYC and sanctions screening methodology description establishes the procedures recommended for the identifying European Compliance Professionals Association sponsors, new members, and their beneficial owners. These recommendations apply to legal entities and may also apply to natural persons. If negative or questionable information is revealed during the inspection, cooperation with such a person shall be refused.
II. GENERAL CONDITIONS
2. It is required to “screen” (assess the sponsors, new members and the related persons through Google platform and remote identification and verification system application on any possible AML, sanction related issues) the legal and natural persons after application to become a sponsor or a new member of the association has been received. The detailed screening procedure is described in Chapter III of this document.
2.1. The screening mentioned in the clause 2 and collection of the documents as per clauses 3.2-3.3 is not required for the following entities:
a) Legal entities, which are supervised by the EEA regulator (the Bank of Lithuania or other relevant EEA regulator);
b) Publicly listed companies (EEA, UK);
c) Big Four companies.
3. After the screening of an applicant sponsor or a new member and the related persons, the following documents must be prepared and the following information and documents must be obtained:
3.1. Questionnaire of an applicant sponsor or new member (signed by the authorized representative of the applicant).
3.2. Copy of latest commercial extract and latest Articles of Association (not older than 6 moths) or electronic version of the document, disclosure of the ultimate beneficial owners upto the private individuals.
3.3. Copy of the identity document of the authorized representative and director, or information about the director - name, surname, date of birth, citizenship, country of residence.
3.4. In case the applicant sponsor is established in high-risk third countries identified by the European Commission, to request a source of funds intended for the sponsorship.
3.5. If upon receival of signed questionnaire indicated in Paragraph 3.1. additional related personas or additional risks related with AML or sanction issues are determined, additional screen shall be executed.
III. METHODOLOGY OF SCREENING
4. Screening of legal entities through remote identification and verification system:
4.1. The applicant and its affiliates shall be screened to identify all shareholders, ultimate beneficiaries, directors, managers, other senior executives, and any business, political, corruption or other links between the subject and other persons.
4.2. Information on the subject of the screening is retrieved by entering the name of the company in the search box (without the abbreviation of the legal form).
4.3. The content of the results shall be reviewed and any negative information relating to the entity shall be saved (adverse media, breaches of the law, legal liability measures applied in the past or currently, sanctions, etc.).
4.4. If the search reveals more information related to the entity being screened, this related information is also checked, e.g. companies, related by ownership, group of companies, etc.
4.5. Persons related to the subject – shareholders, ultimate beneficiaries, directors must be screened (see guidelines, related with the screening of natural persons provided for in Points 5 and 7).
5. Screening of natural persons through remote identification and verification system:
5.1. Natural persons related to the applicant shall be screened (authorized representative, director, shareholders, ultimate beneficiaries, other senior executive).
5.2. Information on the subject of the screening is retrieved by entering the name and surname in the search box. If the search yields many results and the person has additional names, the search is conducted using the full name. Patronyms are not used in a search query unless the results are negative and need to be confirmed or denied.
5.3. The content of the results shall be reviewed and any negative information relating to the person shall be saved (adverse media, breaches of the law, legal liability measures applied in the past or currently, sanctions, etc.).
5.4. If the person originates from a country that does not use the Latin alphabet, the search shall be carried out using both the Latin alphabet and the original script.
5.5. If the name or surname of the person being screened differs by a couple of letters from the one displayed in the search result, then other data to confirm or deny the result is to be used, e.g. person‘s nationality, country of residence, date of birth etc.
5.6. If the results contain information relating to a politician or other public figure, an additional search must be made for information about the possible relationship of the person being checked. A person is also considered to be a Politically Exposed Person (PEP) if a member of his/her family, such as a spouse, a person in a registered partnership, parents, siblings, children and children's spouses, children's cohabitants, or business partners are PEP
6. Screening of legal entities through Google (or other search platform, how it is identified in point 6.4):
6.1. Information on the subject of the screening is retrieved by entering the name of the company in the search box.
6.2. While screening the subject throug Google, the following keywords are also used: fine, fraud, trial, bribery, money laundering, corruption, scandal. The first 20 search results are checked.
6.3. The content of the results shall be reviewed and any negative information relating to the person shall be saved (adverse media, breaches of the law, legal liability measures applied in the past or currently, sanctions, etc.).
6.4. The search is conducted on Google of the country of origin of the subject (In case of China – Baidu, Russia – Yandex). The search results are translated using Google translate.
6.5. If the subject is registered in a Country where the registers of legal persons are public, an extract from the register of that person shall be saved. The natural persons referred to in the extract shall be screened.
6.6. The website of the subject must be checked and saved. If useful information is found, such as a list of directors, shareholders, this information shall also be saved.
7. Screening of natural persons through Google (or other search platform, how it is identified in point 7.4):
7.1. Information on the subject of the screening is retrieved by entering the name and surname of the company in the search box.
7.2. While screening the subject throug Google, the following keywords are also used: fine, fraud, trial, bribery, money laundering, corruption, scandal. The first 20 search results are checked.
7.3. The content of the results shall be reviewed and any negative information relating to the person shall be saved (adverse media, breaches of the law, legal liability measures applied in the past or currently, sanctions, etc.).
7.4. The search is conducted on Google of the country of origin of the subject (In case of China – Baidu, Russia – Yandex). The search results are translated using Google translate.
8.Specifics related to the international sanctions:
8.1. The platform used for screening individuals (remote identification and verification system) can also be used to check whether a person is subject to international sanctions. Remote identification and verification system searches both national and international sanctions lists.
8.2. Specific sanctions lists are used for screening individuals. National sanctions lists and lists published by European Union, United Nations and other international organisations of which the Republic of Lithuania is a member or in which it participates shall be checked. Used sanctions lists:
8.2.1. The United Nations Security Council sanctions list:
(https://www.un.org/securitycouncil/content
8.2.2. The consolidated list of individuals, groups and entities subject to EU financial sanctions list:
(https://ec.europa.eu/info/business-econom y-euro/banking-and-finance/international-rel ations/restrictive-measures-sanctions/overvi ew-sanctions-and-related-tools_en);
8.2.3. The Financial Crime Investigation Service (FCIS) list of Lithuanian entities subject to asset freeze requirements list: (https://www.fntt.lt/lt/tarptautines-finansine s-sankcijos/4166 );
8.2.4. Consolidated list of persons subject to non-asset freeze restrictions imposed by the EU;
8.2.5. Office of Foreign Assets Control (OFAC) Specially Designated Nationals and Blocked Persons List (SDN List) (https://home.treasury.gov/policy-issues/fina ncial-sanctions/specially-designated-national s-and-blocked-persons-list-sdn-human-reada ble-lists);
8.2.6. The OFAC Consolidated Sanctions List (non–SDN List) : (https://sanctionssearch.ofac.treas.gov/);
8.2.7. The Office of Financial Sanctions Implementation (OFSI) Consolidated List of Asset Freeze Targets (the Consolidated List):
8.2.8. The OFSI List of persons named in relation to financial and investment restrictions: (https://www.gov.uk/government/publicatio ns/financial-sanctions-consolidated-list-of-tar gets/ukraine-list-of-persons-subject-to-restric tive-measures-in-view-of-russias-actions-dest abilising-the-situation-in-ukraine);
8.2.9. Other local jurisdiction lists of persons subject to asset freeze requirements or other financial restrictions.
8.3. It is important to identify possible relations of legal and/or natural persons with the sanctioned persons. remote identification and verification system, Google and other sources of information (e.g. rupep.org in the case of Russia) can be used for this purpose.
8.4. Any potentially negative or other information relating to sanctions shall be forwarded to the person supervising the screening of sponsors and new members.