If the services required from us are subject to the Wwft, we are required by law to conduct a client screening. The extent of the investigation depends on the extent of the risk of money laundering or terrorist financing. This risk depends on various factors laid down in the law, by the government and by supervisory authorities. Examples are: the nature of the services, geographical risk factors, the industry in which the client operates and the way in which the transaction is financed.

In an assignment subject to the Wwft, the Wwft prohibits us from rendering substantive services before the client screening has been completed for the most part. The investigation into the origin of the funds (financing), which is a part of the client screening (see below), may be completed during our services in most cases. The client screening means that we must research at least:

If the client is a natural person

• the client’s identity and any representative;
• the purpose and intended nature of the business relationship;
• the representative authority of the person acting on behalf of the client;
• whether the client is acting for himself or herself or for someone else;
• whether the client is a politically exposed person (a ‘PEP’);
• the origin of the funds (e.g. money) used in the transaction.

If the client is a legal entity

• who the ‘ultimate beneficial owner’ (‘UBO’) or pseudo-UBO is;
• the client’s identity, any representative and the UBO or the pseudo‑UBO;
• the purpose and intended nature of the business relationship;
• the ownership and control structure of the legal entity;
• the representative authority of the person acting on behalf of the client;
• whether the client is acting for himself or herself or for someone else;
• whether the UBO or the pseudo-UBO is a politically exposed person (a ‘PEP’);
• the origin of the funds (e.g. money) used in the transaction.

Enhanced client screening

Sometimes we are obliged to take additional measures, in line with the higher risks that have emerged. Enhanced client screening, for example, is mandatory if:

• the client, the UBO or the pseudo-UBO is a politically exposed person (a ‘PEP’); and/or
• there is involvement in a country with a ‘high risk’. This is apparent from the various lists that we have to check.

A combination of factors can also lead to a high risk, and therefore to a mandatory enhanced client screening. Such factors include, for example, the industry in which the client operates, the way in which a purchase price is determined, the way in which the financing takes place and a structure that seems complex in relation to the business activities.