The Anti-Money Laundering and Counter-Terrorism Financing Rules Amendment Instrument 2016 (No. 1) commenced on 16 September 2016 to principally make changes relating to the rules for customer identification.

The changes amend the collection of customer identification information to allow information to be collected from sources other than the customer and to modify the electronic safe harbour provisions for customers.

Collection of customer identification information

The amendments remove the word ‘from’ and replace it with ‘about’ in Chapter 4 with regard to customer identification. As a result reporting entities will have the discretion to collect information from either the customer or from sources other than the customer.

Reporting entities will have flexibility in their approach to collection and verification of customer information including obtaining initial information from an independent source, pre-filling parts of the customer application form and then checking the information with the customer for verification purposes.

Electronic safe harbour provisions

Currently the electronic safe harbour provisions for individual customers state that, in respect to verification, two components are mandatory (customer name and residential address), while two are discretionary (customer date of birth or customer transaction history).

The amendments require one mandatory component in regard to verification (customer name) and a choice of either or both residential address and date of birth or customer transaction history for at least the past 3 years.

Verification must be undertaken by the reporting entity through the use of reliable and independent electronic data from at least two separate data sources.

Other amendments relate to the sale of shares for charitable purposes and the Remittance Sector Register.