PART 3Customer Due Diligence
CHAPTER 1Customer due diligence: general
Requirement to cease transactions etc31
1
Where, in relation to any customer, a relevant person is unable to apply customer due diligence measures as required by regulation 28, that person—
a
must not carry out any transaction through a bank account with the customer or on behalf of the customer;
b
must not establish a business relationship or carry out a transaction with the customer otherwise than through a bank account;
c
must terminate any existing business relationship with the customer;
2
Paragraph (1)(a) does not prevent money deposited in an account being repaid to the person who deposited it, provided that, in any case where a disclosure is required by the legislation referred in paragraph (1)(d), the relevant person has—
a
consent (within the meaning of section 21ZA of the Terrorism Act 2000 (arrangements with prior consent))83 to the transaction, or
b
the appropriate consent (within the meaning of section 335 of the Proceeds of Crime Act 2002 (appropriate consent)) to the transaction.
3
Paragraph (1) does not apply where an independent legal professional or other professional adviser is in the course of ascertaining the legal position for a client or performing the task of defending or representing that client in, or concerning, legal proceedings, including giving advice on the institution or avoidance of proceedings.
4
In paragraph (3), “other professional adviser” means an auditor, external accountant or tax adviser who is a member of a professional body which is established for any such persons and which makes provision for—
a
testing the competence of those seeking admission to membership of such a body as a condition for such admission; and
b
imposing and maintaining professional and ethical standards for its members, as well as imposing sanctions for non-compliance with those standards.
5
Paragraph (1)(a) to (c) does not apply where an insolvency practitioner has been appointed by the court as administrator or liquidator of a company, provided that—
a
the insolvency practitioner has taken all reasonable steps to satisfy the requirements set out in regulation 28(2) and (10), and
b
the resignation of the insolvency practitioner would be prejudicial to the interests of the creditors of the company.