The aim of the KYC principle is to take care of safe environment, to prevent the risks of money laundering and terrorism financing. To achieve this, it is the responsibility of all banks to take a risk-based approach to obtaining information on their customers and the source of their funds.
According to regulatory enactments (Section 28 of the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing), the bank is entitled to request its customers and the customers have an obligation to provide true information and documents necessary for the customer due diligence, including information on the beneficial owners, transactions executed by the customers, economic and personal activity, financial position, sources of money or other funds of the customers. In some cases, the bank may request additional information.
Why are banks asking questions?
