Why Is Client Due Diligence Required?
As an accounting service provider, we are legally required to identify and verify our clients before establishing a business relationship.
Client due diligence is a mandatory procedure under Hungarian anti-money laundering legislation. Its purpose is to help prevent money laundering, terrorist financing and the misuse of legitimate businesses for unlawful purposes.
This procedure is required for every client. It does not mean that there is any suspicion concerning you or your business.
What Information Do We Need?
The exact documents depend on whether the client is an individual entrepreneur or a company.
We will normally request:
- identification details and a valid identity document;
- proof of address;
- the client’s tax and registration details;
- identification of the person acting on behalf of the business;
- confirmation of the representative’s authority;
- information about the company’s ownership and control structure;
- identification of the ultimate beneficial owner or owners;
- a declaration concerning politically exposed person status; and
- basic information about the purpose and expected nature of the business relationship.
In certain higher-risk situations, we may be legally required to request additional information or supporting documents, for example regarding the source of funds or the source of wealth.
How Is the Identification Completed?
Identification may be completed in person or, where available, through a legally compliant remote identification procedure.
We will inform you which documents are required and how they should be provided. The information is checked against the documents presented and, where appropriate, against official registers.
The extent of the procedure may vary depending on the client’s ownership structure, country of residence, business activity and other legally defined risk factors.
If the legally required client due diligence cannot be completed, we are not permitted to begin or continue providing accounting services.
Keeping Your Information Up to Date
Client due diligence is not limited to the beginning of the business relationship. We are also required to keep the recorded information up to date and to monitor whether the services and transactions are consistent with the information available about the client’s business.
Please notify us within five working days if there is any change affecting:
- your identification or contact details;
- the company’s registered information;
- the authorised representative;
- the ownership structure;
- the identity of the ultimate beneficial owner; or
- politically exposed person status.
We may periodically ask you to confirm or update the information previously provided.
Protection of Your Data
The information and documents obtained during client due diligence are processed confidentially and used only for compliance with our legal obligations and the provision of our services.
The relevant records and document copies must normally be retained for eight years after the end of the business relationship. They are disclosed to an authority only where required by law.
