AML/CFTR 4.3.4 When CDD may not be required — acquired businesses

(1) This rule applies if a firm acquires the business of another firm, either in whole or as a product portfolio (for example, the mortgage book).
(2) The firm is not required to conduct CDD for all customers acquired with the business if:
(a) all customer account records are acquired with the business; and
(b) due diligence inquiries before the acquisition did not give rise to doubt that the AML/CFT procedures followed for the business were being conducted in accordance with the AML/CFT Law and these rules or the law of another jurisdiction that has an effective AML/CFT regime.
(3) However, if the AML/CFT procedures followed by the acquired business were not conducted (or it is not possible to establish whether they were conducted) in accordance with the AML/CFT Law and these rules or the law of another jurisdiction that has an effective AML/CFT regime, the firm's senior management must prepare or approve, and document, an action plan that ensures that the firm conducts CDD for all of the customers acquired with the business as soon as possible.
(4) Also, if subrule (3) does not apply, but full customer records are not available to the firm for all of the customers acquired with the business, the firm's senior management must prepare or approve, and document, an action plan that ensures that the firm conducts CDD for all of the customers for whom full customer records are not available to the firm as soon as possible.
Derived by QFCRA RM/2019-8 (as from 1st February 2020)