This article will guide you through the start to finish process of using the AML-CFT Workflow in Connectworks to perform Client Due Diligence and help meet your compliance obligations under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009.
There is a printable .pdf training module available to download at the bottom of this article.
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Setting up the entity requiring CDD
The AML Workflow can be used to perform Client Due Diligence (CDD) on individuals as well as entities. The first step is to ensure that the entity has been loaded and appears in your firms Clients tab. Currently you are able to load companies and trusts into Connectworks, to conduct CDD on other entities such as Partnerships, Joint Ventures or Estates please contact the Connectworks support team at firstname.lastname@example.org.If the required entity is a trust, company or individual and is not already set up, please refer to the articles below for further instructions.
Adding Identity Evidence and Making a determination
Under the AML-CFT Act there are three key identity verification requirements:
- Record identity information
- Verify identity information
- Verify the individual matches the identity information provided
To perform identity verifications, you first need to upload identity information & evidence against the individuals involved. Although this information can be captured in a variety of places within Connectworks, the best place to enter the information is your firm's contacts list. To do this:
1. Navigate to your firm's Clients>Contacts list.
2. Using the search bar type the name of the contact you wish record identity information against.
Important - if searching your contacts list shows multiple copies of the same person please ensure you merge all duplicate profiles before proceeding with the next steps.
3. When a single copy of the individual appears in your Client>Contacts list place a tick next to the contact, click on the cogs menu and select ‘edit profile’.
4. Navigate to the ‘Identity information’ tab of the Update contact form. Here you can upload identity evidence documents and/or perform a Centrix SmartID check on the client. Click the "Start Adding Evidence" button and then select the type of evidence you are recording. After collecting a piece of evidence you may choose to continue adding further forms of identity information by selecting "Add evidence".
5. You can also use Centrix SmartID to verify the identity information provided. Centrix runs a search based on the information provided, across government, banking and other databases to verify that the details are accurate and up-to-date. Along with that, Centrix also does an international Politically Exposed Person (PEP) and Sanctions check using the Thompson Reuters Worldcheck database.
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6. Once you are satisfied with the evidence collected you can make a final determination that the individual's identity has been verified. To do this simply select "Make a determination". Then using the identity evidence collected complete the name, date of birth and address fields below. The fields will pre-populate based on the evidence collected. If you are satisfied the identity information showing is correct select "Confirm Identity".
The AML Compliance Tab
Once the individual's identity information has been uploaded and a determination has been made, navigate to your firm's ‘Work>AML Compliance’ tab.
Initially, every entity your firm manages will appear in the ‘Undergoing CDD’ subsection on the ‘AML Compliance’ tab.
After completing the AML workflow the entity will be move to the ‘Completed CDD’ tab.
You can apply filters to the workflow in the left-hand column, to view the clients list by:
- Date scheduled to be completed
- Review status
- Level of CDD
- Level of risk
- Client type
- Business unit
Performing CDD on an Entity
CDD Workflow Steps
Within the ‘Undergoing CDD’ page of the AML Compliance workflow, search for, then click on the name of the entity you would like to perform a CDD check on. A slide out form will appear which provides the information you need to capture, based on the legislation and DIA guidelines.
1. If desired, schedule a due date for completion of CDD.
2. Under the ‘Nature of business relationship’ select all applicable options for this entity.
At the bottom of this page, you also have the option to enter additional notes and attach any supporting documents, such as an internal checklist or terms of engagement which the client has agreed to.
3. The last step on this page is to select the ‘Level of CDD to perform’. Based on the outcome of your risk assessment you can select from Simplified, Standard or Enhanced CDD.
Note. A trust will always require Enhanced CDD so this option will be selected by default.
4. Once you have filled out all the details on this page, click ‘Update’ on the top right corner.
1. Navigate to the "Client Information" subsection in the left-hand column. Most fields in this subsection will already be filled via the information provided from the Companies Office, or previously recorded within the entity's profile.
Make sure to update the company type (if required) as its default selection is ‘Limited (Small)’.
There is a legal requirement to enter a companies trading name if it differs from the legal entity name.
2. Once you have checked all the information is correct and made any amendments, select the tick box at the bottom of the page "This section has been completed"
3. Select "Update"
1. Navigate to the "CDD Candidates" subsection in the left-hand column. A list of the parties associated with the client will appear here.
2. Next to the names the people you would like to include in the entity's CDD select "Add".
NB. If there are candidates missing from the list of CDD candidates, you will have to navigate back to the entities workspace to add in the required individuals. Be aware that for companies, unless you have manually updated the share register held in Connectworks it will only display the share register as it was recorded with the Companies Office on the day of import. If the share register is up to date and you have identified parties with effective control/beneficial ownership then these individuals will pre-populate as requiring CDD.
Important: If more than one copy of an individual appears in the list return to your Clients>Contacts tab, search for the person and Merge Duplicate Contacts before proceeding with the next step.
3. As you add candidates they will form a list which displays their roles within the entity.
4. When you are satisfied that the correct people appear in this list, with the correct roles showing beneath their names select the tick box "This section has been completed".
5. Select "Update".
Note: As you progress through the steps you will notice that ticks begin to accumulate next to each section, this will only occur when it has been marked as complete. If you want to come back to complete a section simply update without selecting "This section has been completed". The section will remain unticked until updated.
1. Navigate to the "Perform CDD" subsection in the left-hand column. A list of the CDD candidates will appear displaying the ID information that was added against the individuals in the first step Adding evidence and making a determination.
2. If the evidence from a prior determination displaying is correct you can select "Use this".
3. If the individual's information needs updating or a person does not have any ID information appearing, select "Collect & Verify" to make a new determination. You can also update the "PEP and source of funds" using the update link next to the section.
4. Click update once this section has been completed.
Once identity verification and PEP checks have been completed for each individual that is part of the entity, the ‘Perform CDD’ section has been completed and you can now move onto the ‘Source of funds’ section of the CDD form.
You can enter information and attach documents such as tax returns or sale & purchase agreements.
Click update once this section has been completed.
The ‘Risk assessment’ section contains a list of what is considered to be risky activities by the Department of Internal Affairs.
1. Select all activities which apply for this entity, or add your own notes in the "other field".
2. Under the checklist, there is a risk exposure drop down. Having determined the areas of risk, assign an overall risk rating for this client.
3. At the very bottom, there is a ‘Final determination’ section, here you can select ‘Proceed with client’ which will put the CDD into the "first review" workflow stage, ready to be assessed by your firms' AML Compliance Officer.
AML Workflow Status: First Review
In general, all steps until this point can be completed by firm administrators. The "First Review" step in the workflow provides the opportunity for a client manager, firm manager or Partner to review and approve that the information that has been captured up until this point.
When the entity has been progressed to "First Review" there should be an internal process at your firm to advise the person responsible for this step to log in and check these clients by following the steps outlined below:
1. In the firm workspace navigate to the Work>AML Compliance>Undergoing CDD tabs.
2. In the left column apply the ‘First review’ filter.
3. Click on the name of any company in the first review stage to automatically open the ‘Review & confirm’ section which displays a summary of all the information.
4. If you are satisfied with the summary then simply select the tick box "I have reviewed and confirmed CDD on this client" and then select "Submit confirmation"
NB. If more information is required the reviewing manager can navigate back to the appropriate section of the workflow and add or amend the information, then proceed with the confirmation.
AML Workflow Status: Second Review
The second review is for your AML Compliance Officer to make a final confirmation that the CDD has been completed.
Just like the first review, your firm should have an internal process to advise the AML Compliance Officer when there are entities to be checked.
When making the second review you can also schedule a specific date for re-running CDD on the client. If not updated, the system will default to requiring a CDD check again in 2 years.
Once the second review has been completed, the entity will then moved into the "Completed CDD" tab (at the top) and the entities next scheduled review date is displayed next to it.
If for any reason you need to update CDD on a client in the "Completed CDD" tab you can do this by selecting the tick box by the entity name, then using the "..." drop-down menu select "CDD needs updating", then return to the "undergoing CDD" tab and update as required.