The FCA states that it recognises the need to balance financial crime checks with getting money to businesses in need. Therefore existing customers, on which customer due diligence (CDD) has already been conducted, do not need additional checks unless other red flags of money laundering are identified.
For new customers, CDD must still be applied, but firms may make the decision to apply simplified due diligence where it deems the customers low risk. The FCA also pointed to alternative verification methods outlined in its recent “dear CEO” letter.
We recognise that, currently, the need to manage these risks should be balanced against the need for the fast and efficient release of funds to businesses under the Government’s schemes. So, for existing customers, we consider, in the specific circumstances of the current environment, where an authorised firm has carried out appropriate Customer Due Diligence (CDD) before it received an application under the schemes, it does not need to make further checks. However, if an authorised firm has information - including any relevant flags or alerts - suggesting a customer poses a higher risk, for example, of fraud, money laundering, or terrorist financing, it should carry out additional checks.