AML 7.7 AML 7.7 Failure to conduct or complete customer due diligence
AML 7.7.1 AML 7.7.1(1) Where, in relation to any customer, a
Relevant Personis unable to conduct or complete the requisite Customer Due Diligencein accordance with AML Rule 7.1.1 it must, to the extent relevant:(a) not carry out a transaction with or for the customer through a bank account or in cash;(b) not open an account or otherwise provide a service;(c) not otherwise establish a business relationship or carry out a transaction;(d) terminate or suspend any existing business relationship with the customer;(e) return any monies or assets received from the customer; and(f) consider whether the inability to conduct or complete Customer Due Diligencenecessitates the making of a Suspicious Activity Report under AML Rule 13.3.1(c).(2) A Relevant Personis not obliged to comply with (1) (a) to (e) if:(a) to do so would amount to "tipping off" the customer, in breach of Federal AML legislation; or(b) the FIU directs the Relevant Personto act otherwise.
AML 7.7.1 Guidance1. In complying with Rule 7.7.1(1) a
Relevant Personshould apply one or more of the measures in (a) to (f) as appropriate in the circumstances. Where CDDcannot be completed, it may be appropriate not to carry out a transaction pending completion of CDD. Where CDDcannot be conducted, including where a material part of the CDD, such as identifying and verifying a Beneficial Ownercannot be conducted, a Relevant Personshould not establish a business relationship with the customer.2. A Relevant Personshould note that Rule 7.7.1 applies to both existing and prospective customers. For new customers it may be appropriate for a Relevant Personto terminate the business relationship before a product or service is provided. However, for existing customers, while termination of the business relationship should not be ruled out, suspension may be more appropriate depending on the circumstances. Whichever route is taken, the Relevant Personshould be careful not to tip off the customer.3. A Relevant Personshould adopt the RBA for CDDof existing customers. For example, if a Relevant Personconsiders that any of its existing customers (which may include customers which it migrates into the DIFC) have not been subject to CDDat an equivalent standard to that required by this module, it should adopt the RBA and take remedial action in a manner proportionate to the risks and within a reasonable period of time whilst complying with Rule 7.7.1.