We understand that there are some concerns and questions regarding the legal basis for the submissions we assist your associations with making to financial institutions as part of the Anti Money Laundering (AML) legislation. It is important to note that these submissions are a necessary part of our societal responsibility and are in accordance with the law.
Why are these submissions important?
Protection against financial crime: AML legislation is designed to prevent the misuse of the financial system, including money laundering and the financing of terrorism. By reporting information about our associations and board directors, we help ensure that our activities remain legitimate and transparent.
National and international compliance: As a member of the UN and EU, Denmark is obligated to comply with international standards for combating financial crime. AML legislation is part of our national effort to meet these obligations.
Integrity and credibility: By submitting information about our associations, we demonstrate our commitment to maintaining the integrity and credibility of our society’s financial structure.
What does the law say?
AML legislation provides financial institutions with the legal authority to collect the necessary information about our associations and board directors. This is part of their responsibility to prevent financial crime.
We encourage you to take these submissions seriously as an important part of our societal responsibility. It’s a way for all of us to contribute to protecting our society and our financial system from misuse.
Know Your Customer (KYC) and financial institutions’ procedures
We understand that some of you may have questions about how financial institutions address the legal basis for KYC requirements under AML legislation and the choices they make in that regard. It’s important to understand that while each financial institution has its own KYC procedures, they all follow the same fundamental principles in compliance with the law.
What is KYC?
KYC involves financial institutions collecting information about their customers to understand their financial activities and identity. This helps prevent financial crime by identifying suspicious transactions.
Individual financial institutions’ procedures:
Each financial institution may have different ways of collecting and assessing KYC information, but they usually include:
Identification: Collecting documentation that verifies the customer’s identity, such as ID, address, and company registration (CVR) number.
Purpose of the business relationship: Understanding the purpose of the customer relationship, e.g., why an association is opening a bank account.
Transaction monitoring: Monitoring transactions to identify suspicious activities and ensure they are legitimate.
Annual updates: Periodic updates of the customer’s information to ensure its accuracy.
How does this affect our associations?
For our associations, this means that we must provide financial institutions with the necessary information about our association and board directors when opening bank accounts or conducting major financial transactions. This helps fulfill our responsibilities under AML legislation.
We encourage you to cooperate with financial institutions and provide them with the necessary information to make the process as smooth as possible.
If you have specific questions about the procedures your financial institution follows, feel free to contact them directly for further information and guidance.
We appreciate your understanding and cooperation in this important effort to prevent financial crime.
