Obligation to identify clients

The Netherlands

The Act for the prevention of money laundering and financing of terrorism ('Wet ter voorkoming van witwassen en financiering van terrorisme ('Wwft')) has taken effect on 1 August 2008. Under this act we are obliged to carry out a risk based investigation into our clients (either a regular, a simplified or an intensified investigation is required). This means that we need to identify the client and to verify the identity. We are also required to identify and to verify the Ultimate Beneficial Owner (UBO) and to take additional measures if the client is a co-called Politically Exposed Person (PEP) and in other cases where a higher risk of money laundering and financing of terrorism is involved. In order to comply we therefore have to gather and to save the data as specified in this act with regard to the client and - per matter - their contact(s). In all cases the business relationship with the client is to be monitored continually, as its nature can change in the course of the relationship. This could mean that where at first a regular client investigation was sufficient, at some point an intensified investigation may become necessary.

The Wwft also prescribes that we disclose transactions of an unusual nature to an independent agency, the Financial Intelligence Unit in Zoetermeer, the Netherlands (FIU-Nederland). The act provides for indicators to identify unusual transactions. In such cases, we are not permitted to invoke our right of non-disclosure. Pursuant to this act, reporting is mandatory and we are not permitted to inform the client about the report.

Failing to meet the obligations pursuant to the aforementioned act is an economic offence for which we could be prosecuted.