The UK is one of the most developed countries in the fight against financial crimes including fraud, money laundering, and terrorist financing. Strict and advanced UK Anti-Money Laundering (AML) laws are in place to detect such crimes and to prevent the use of professional services for conducting criminal activity. Financial institutions that don’t comply with these laws can find themselves subject to penalties which could be financial or, depending on the nature and severity of the crime, result in up to 14 years in prison for named individuals within the firm.
As a UK SIPP provider authorised and regulated in the UK, PSG SIPP Limited are under an obligation to meet these strict AML requirements imposed by our regulators. What does this mean in practice? It means we must have documentation on file that proves in a satisfactory way that a client is who they say they are and that they live at a particular address.
To ensure our continued compliance with anti-money laundering requirements, we regularly consult with a third-party industry expert in the subject. Our PSG SIPP AML Guide is a result of this consultation.
Proof of identity is usually straightforward, as a copy of a passport does the job – providing it has been certified in the correct way by a suitable person! But how do you prove where you live? The documents listed in PSG SIPP’s AML Guide are documents that are considered robust enough to prove residency. Where none of these documents can be provided, we will always look at alternatives and we invite the submission of any documentation available so that we can review it. Our Money Laundering Reporting Officer will then make a decision as to whether this is an acceptable proof of address.
Another thing to think about is the fact that in the UK, the transfer process is governed by strict rules which schemes must abide by to ensure the transfer is compliant. In our experience, 2 items of proof of address (POA) are often requested by DB schemes. Therefore, it’s always worth keeping in mind that just because PSG SIPP Limited may only require one form of POA as per the list in the AML Guide, other parties involved will have their own separate requirements.
We do often receive items that are not an acceptable POA and inevitably this will cause us to have to pause the case, adding delays to requesting the transfer and meaning we can’t get on with the important work our customers expect us to be doing! These delays can usually be avoided by noting our AML requirements beforehand and ensuring these are met prior to sending in the case.
Common documents we receive that are not acceptable proof of address
· Tenancy contracts. These are never acceptable when they are not from a recognised and verifiable estate/lettings agency or government authority. If they are from a recognised and verifiable estate/agency then they still need to be accompanied by at least one other item of POA.
· Resident permit. These can help show that the client is residing in a particular country, but do not tie a client to a residential address.
· Marriage certificate. A marriage certificate is not particularly useful for any purpose other than to prove a change of name when a person has changed their surname due to marriage. They cannot prove that a marriage has not since been dissolved, so they aren’t able to tie one person to another.
· Letter from a bank/building society/insurance company. A cover letter alone is not sufficient for proof of address. We require a statement dated within 3 months from a bank/building society, or a Life Insurance/Assurance policy dated within the last 3 months from an insurance provider.
· Employer letter – these ARE acceptable on their own ONLY in the scenario that the employer provides the accommodation as part of the employment. In the event that the employer does not provide the accommodation as part of the employment, an employer letter must be accompanied by at least one other item of POA.
The above list is certainly not exhaustive, but it does provide an idea of what we cannot accept and what to look out for prior to sending in a new SIPP application. We’re always happy to speak with anyone that’s unsure about what might be acceptable and to review documentation prior to receiving a SIPP application; so do get in touch if you need assistance!