Juridical entities significantly contribute to a country’s economic growth through their commercial and business activities. Their financial transactions enhance the financial system’s breadth and depth. However, the separate legal personality of these entities can be exploited to conceal the true identity of beneficial owners and the actual nature or purpose of transactions. Criminals might use complex corporate ownership structures to hide behind legitimate businesses, masking their beneficial ownership (BO) status. Therefore, BO due diligence is becoming a crucial part of managing risks related to money laundering (ML), terrorist financing (TF), and proliferation financing (PF).
Section 921/921-Q of the Manual of Regulations for Banks/Manual of Regulations for Non-Bank Financial Institutions mandates BSP-supervised financial institutions (BSFIs) to identify beneficial owners, verify their identities, and understand the nature of the customer’s business and its ownership and control structure.
This Guidance Paper aims to provide BSFIs with a reference for benchmarking best practices in the industry and refining their policies, systems, processes, and controls for better BO identification and verification. BSFIs should use this paper to enhance their ML/TF/PF risk management systems in line with their risk posture.
Read the full Guidance Paper below
By FCCT Editorial Team
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