Know Your Customer
In order to ensure that the Bank meets the relevant statutory requirements and regulatory expectations, it must
- collect specific data on its customers as a precondition for account opening, and
- periodically review such data during the existence of the customer relationship.
Why is it necessary for the Bank to know its customers?
Apart from the relevant data protection requirements, the Bank’s obligation to keep data up-to-date and have proper "customer knowledge" is based on the following laws:
- Hungarian laws concerning the prevention and impeding of money laundering and terrorist financing, and
- the European Union Directive underlying these.
The purpose of the review of customer data is to ensure that the Bank shall any time have up-to-date and current data on its customers, including in particular data obtained
- in the course of the customer due diligence procedure and
- during the existence of the business relationship.
What does the reconciliation of data mean?
The Bank reconciles the customer’s
- identification data, and
- makes questions - among others - about
- the customer’s business activities,
- trading habits, and where applicable
- the source of his/her wealth managed at the Bank.
What is to be done upon any change in the customer’s data?
In accordance with Part One, Chapter XII, Sections 12.1 and 12.2 of the Bank’s General Business Conditions, customers are required to inform the Bank of any change in their data.
Customers may certify changes in their data with the following documents:
- private individuals with their valid personal identification documents;
- companies and other entities with company register extracts or certificates not older than 30 days that testify the customer’s data and the fact that the customer is included in the relevant statutory registry;
- in the case of companies registered abroad, the extract/certificate presented as a proof of registration is only acceptable in the form of a certified Hungarian translation.
Identification of companies:
The documents submitted by the customer should serve as proof for:
- the customer’s existence
- the place of its registration and actual operation
- its activities
- the right of the company’s representatives or agents to act on behalf of the company
- its ownership structure and the respective ownership shares of the owners
The persons acting on behalf of the company (representatives, attorneys), and the ultimate beneficial owner must be identified on the basis of their personal identification documents, and the politically exposed person status of the beneficial owner should be revealed in the form of a declaration.
Knowledge of the ownership structure of companies:
It is mandatory for all companies keeping accounts at Raiffeisen Bank to reveal their ownership structure supported by documents.
"Intermediate owner(s)" means entities having an at least 25% share at the first level of the ownership structure, and more than 50% ownership share in the upper levels of the ownership structure, considering shareholdings as well.
"Ultimate beneficial owner(s)" means the natural person at the end of the ownership chain who holds 25% or more of votes or ownership interest, or exercises actual governance or control over the legal person or entity without legal personality in some other way, or has controlling interest in the same, or in the absence of such person the executive officer(s). These persons must be identified in the beneficial ownership statement.
The head of the company is required to present detailed information on the ownership structure of the company (ownership tree diagram) if the owners include private individuals as well as companies. If the ownership chain consists only of private individuals, no further information is requested, and sole proprietors, small-scale agricultural producers, and one-man companies also constitute exceptions.
"Ownership tree diagram" means in essence the customer’s “family tree” leading from the customer to the ultimate beneficial owner(s). A diagram showing the customer’s ownership structure visually, also including the different ownership ratios in respect of the customer. The endpoint of the ownership tree is the beneficial owner.
The Bank shall accept information on the ownership chain only if the Customer prepares the ownership tree diagram on the ownership structure himself/herself, furnishing the same with an authorised signature.
The ownership tree diagram must include the following information:
- in the case of companies: corporate name + registered office + country of registration
- in the case of private individuals: name + country of residence
- ownership ratio
Frequently asked questions
|Do you request information from all customers of the Bank?||Yes, we ask all our customers, but the questions vary according to customer types. By answering our questions and making the appropriate information available to us, you and the other customers of the Bank facilitate the fulfilment of the Bank’s statutory obligation.|
|Why are you asking these questions?||Having proper customer knowledge is a statutory obligation for the Bank, which is based on Hungarian laws and the relevant European Union Directive. It is in the interest of the customer as well as of the Bank that using its customer knowledge the Bank can protect the financial interests of its customers and recognise potential unlawful activities, including fraud prevention considerations as well.|
|What does the Bank use such information for?||It is on the basis of this information that the Bank updates the customer data available to it. This way it can be ensured that all information included in the Bank’s registries is correct and up-to-date. The information provided by the customer assist the Bank in knowing and understanding its customers.|
|Do you share such information with other banks as well?||No. The data provided by you will be treated confidentially, in accordance with the laws concerning bank secrets and data protection.|
|Is it enough if I answer the Bank’s questions once?||In order to meet regulatory requirements, the Bank must periodically as well as any time when doubts arise regarding the appropriateness of the data, review the customer data available to it.|
|I have been the Bank’s customer for longer than 5 years. Why do I have to answer these questions?||In the case of all new and existing customers the data available on the customer must be periodically reviewed, irrespective of when the customer relationship was established. Having proper customer knowledge is a statutory obligation for the Bank. We need to request information from our customers in order to meet this obligation.|
|What happens if I don’t answer the questions?||If the data prescribed in the law are not up-to-date, the Bank may provide certain banking services in a limited extent only, or not at all, to the Customer.|
|What are the consequences if the answers I give to the questions differ (or might later differ) from the actual situation?||Depending on the answers, the Bank may need to collect additional information. In the case of differences we must clear up with you whether the data provided are (still) correct or not.|