How to comply with German KYC regulations

1. What are German KYC regulations?

If you’re doing business in Germany, it’s important to be aware of the country’s KYC regulations. KYC stands for „know your customer“, and it refers to the process of verifying the identity of your customers.

In Germany, this process is regulated by the Money Laundering Act, which requires businesses to take measures to ensure that their customers are who they say they are. There are a few different ways to comply with German KYC regulations.

One is to require your customers to provide identification documents when they sign up for an account with your company. This could include a passport or a ID card.

Another way to comply with German KYC regulations is to use a third-party service that specializes in verifying customer identities. This option may be more expensive, but it can save you time and resources in the long run.

Whichever route you choose, it’s important to make sure that you’re taking steps to comply with German KYC regulations. By doing so, you’ll be able to avoid fines and other penalties from the government.

2. Why do you need to comply with them?

It is important to comply with German KYC regulations for a number of reasons. Firstly, they help to ensure that financial institutions are able to identify and screen out potential money launderers.

Secondly, they help to protect the privacy of customers. And thirdly, they can help to make the process of opening an account easier and more efficient. There are a number of steps that you can take to ensure that you are complying with German KYC regulations.

The first thing you should do is make sure that your company has an approved identity verification system in place. This will help to make sure that all new customers are properly identified before they can open an account with you. You should also keep records of all KYC information for at least five years after the customer has closed their account. This will help to make sure that you are able to respond to any requests from regulators in a timely manner.

3. How can you make sure you’re compliant?

Complying with German KYC regulations can be a challenge, but it’s essential if you want to do business in the country. To ensure you’re meeting all the requirements, there are a few steps you should take.

Firstly, make sure you have an up-to-date customer due diligence (CDD) policy in place. This should include measures such as risk assessments and records of customer identification. It’s also important to have procedures in place for ongoing monitoring of customers and transactions, so that any unusual activity is quickly identified and investigated.

You should also make sure your staff are trained and aware of their responsibilities under the regulations. This will ensure they understand the importance of following the right procedures, as well as feeling confident that they can spot suspicious activity and know how to report it.

Finally, make sure you have adequate systems in place to store and manage customer data securely. This includes having strong access controls, encryption where necessary and regular backups to ensure data is always available when needed.

By taking these steps, you can be sure you’re compliant with German KYC regulations – allowing you to do business confidently in the country without worrying about any potential breaches or fines.

4. How can S+P Compliance Services help you with German KYC compliance?

With the S + P Onboarding Check you fulfill the general due diligence requirements (CDD) according to § 10 MLA. This includes

  1. the identification of the contractual partner and, if applicable, of the person acting on his behalf in accordance with § 11 para 4 MLA and § 12 para 1 and 2 MLA as well as the verification whether the person acting on behalf of the contractual partner is authorized to do so
  2. clarifying whether the contracting party is acting on behalf of a beneficial owner and, if so, identifying the beneficial owner in accordance with § 11 paragraph 5 MLA. This includes, in cases where the contracting party is not a natural person, the duty to find out the ownership and control structure of the contracting party by reasonable means,
  3. obtaining and assessing information on the purpose and intended nature of the business relationship, insofar as this information is not already unequivocally apparent from the business relationship in the individual case, determining,
  4. Using appropriate risk-oriented procedures, whether the contractual partner or the beneficial owner is a politically exposed person, a family member or a person known to be closely associated.

The 4 Step Check is an innovative digital solution from S + P Compliance Services. It makes the onboarding of new clients efficient and secure. You receive a complete KYC check for your customer and fulfill your AMLA duties of care.

 

KYC Check: B2B Check § 11 MLA regulates the obligations for the identification of a legal entity or a partnership. We carry out this check worldwide. We identify your contractual partners, the person appearing and determine the beneficial owner.

With PEP checks and SIP checks, we determine the customer risk profile B2B.

KYC Check: B2C Check Natural persons are identified with Video Ident. Your customer can identify himself conveniently and easily with our digital solutions.

With PEP checks and SIP checks, we determine the customer risk profile B2C.

Embargo and Sanctions Check We carry out the necessary checks against embargo lists and financial sanctions lists for you.

The embargo and sanctions check covers checks on persons, companies, aircraft, ships as well as regions and countries.


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