35 Obligation to apply customer due diligence measures

(1) A reporting entity shall apply customer due diligence measures in respect of customers, business relationships and transactions, and conduct ongoing monitoring of business relationships.
(2) Customer due diligence measures includes—
(a) identifying the customers identity on the basis of documents, data or information obtained from a reliable and independent source or from any other source that the reporting entity has reasonable grounds to believe and can be relied upon to identify and verify the identity of the customer;
(b) obtaining the identity of the beneficiary of the life insurance policy and other investment related insurance policies, benefactors under the policy and the verification of person or a legal person or a legal arrangement shall be carried out at the time of payout and if the reporting entity is unable to obtain such information, it shall prepare and submit a suspicious transaction report to the FIU;
(c) where the customer is not the beneficial owner, identify the beneficial owner in accordance with the determination provided under regulation 3 of the Beneficial Ownership Regulations, and take reasonable measures, on a risk-sensitive basis, to verify the identity of the beneficial owner, including, in the case of a legal person, partnership or trust through the following information—
(i) the identity of the natural person who ultimately has a controlling ownership interest;
(ii) the identity of the natural person exercising control through other means;
(iii) the identity of the relevant natural person who holds a senior management position;
(Amended by Act 62 of 2021)
(d) obtaining information on the purpose and intended nature of the business relationship and to establish details of the business of the customer or a beneficial owner to enable the reporting entity to identify—
(i) complex or unusual large transactions;
(ii) unusual patterns of transactions which have no apparent economic or visible lawful purpose; or
(iii) any other activity which may be, by its nature, likely to be related to money laundering, financing of terrorism or other criminal conduct; and

(e) take reasonable measures to ascertain the purpose of a one-off transaction and the origin and ultimate destination of funds involved in a one-off transaction or transfer as part of a business relationship.
(3) A reporting entity that is requested to provide a life insurance policy, or similar investment insurance policy, shall take measures to establish and verify the identity of the person in respect of whom such policy is being taken, using its independent reliable source and documents.
(4) Where the customer is not an individual, the reporting entity shall take reasonable measures to—
(a) identify the customer and verify its identity through the following information—
(i) name, legal form and proof of existence;
(ii) the powers that regulates and binds the customer, including the name of the relevant persons with a senior management position;
(iii) the address of the registered office, and if different, a principal place of business;
(b) verify that any person purporting to act on behalf of the customer is authorised to do so; and
(c) identify and verify the identity of that person.
(5) The customer due diligence measures for identifying and verifying the identity of the beneficial owners shall not be required in respect of an individual who holds shares or other equity interests in a legal person, partnership or trust, the securities of which are listed on a recognised exchange.
(6) Where the reporting entity reasonably believes that performing the customer due diligence process will tip-off the customer, the customer due diligence process shall not be pursued and the reporting entity shall file a suspicious transaction report under section 48 of this Act.