Anti Money Laundering Identity Requirements

ANTIMONEY LAUNDERING (AML) IDENTITY REQUIREMENTS OF KYNANCE FINE ART

As from January 2020, the UK government introduced new anti-money laundering legislation following the Fifth EU Money Laundering Directive. Art market participants are now regulated AML entities, who must comply with mandatory checks and record keeping requirements for sales of certain works of art such as paintings for a total purchase price of more than Euros 10,000 (currently about £8,500).

One implication for our clients of Kynance Fine Art being regulated is that the law requires us to carry out checks of both new and existing clients before we accept payment and release property.  These checks are similar to the Know Your Client, Customer Due Diligence checks carried out by major auction houses, banks and law firms, with which you may be familiar.  Failure to comply exposes Kynance to criminal sanctions.  Highlighted below is a summary of the process that must be followed.

For individuals.  If a person is buying for themselves, or, as an agent or advisor to a client, or as a person who owns or controls a company, known as Ultimate Beneficial Owner (UBO), the type of information needed to identify the person and verify their identity, includes:

  • Full name
  • Date & Place of Birth
  • Nationality
  • Permanent Residential Address
  • For agents, proof of authority to act
  • For UBOs, the entity information, as below

We need to see and keep a copy of a valid government-issued photo ID such as a passport, driving licence or national identity card and a proof of address, such as a recent utility bill. This may be done virtually or in person.

Where there is either an agent or adviser acting on behalf of a buyer, we are required to verify the identity of the agent/advisor, as well as the identity of the ultimate buyer.  If the person is a director acting for a company or a UBO who owns or controls the company, we will need their information as well as the entity information listed below.


For legal entities, such as a company or trust.   If an entity is the buyer of record, we will similarly need to identify and verify both the entity and certain individuals either acting for the entity or those who own or control  the entity, the UBOs. For the entity, such information typically includes:

  • A U.K. company’s Memorandum and Articles of Association, or local equivalent
  • A list of the company directors
  • Proof of identity for one company director,
  • Proof of identity for one signatory on the company’s bank account
  • Identification of the UBO of the legal entity, if any

Invoice, Payments and Delivery   It is our policy that the individual or entity named on the invoice, the name associated with the bank account that is used to pay for the property and any delivery address must be the same. In the event that you wish to have any of the invoice, payment source or delivery location vary, please let us know as we reserve the right not to conclude transactions where the invoice, source of funds and delivery address are not the same.


GDPR

The information provided will be held and processed in accordance with General Data Protection Regulations, which set stringent requirements for the protection of personal data, and will remain confidential. We are grateful for your assistance with these regulations which are aimed at avoiding criminals being able to conceal the proceeds of crime.

We ask for your patience  as we carry out these mandatory checks.  We will do our best to make the process as quick and efficient as we can.