Know Your Customer (KYC)

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Kilkis
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Know Your Customer (KYC)

Postby Kilkis » Thu Aug 31, 2017 1:30 pm

I have just had experience of the KYC regulations and I thought the information gained might be valuable to anyone else who finds themselves having to satisfy their requirements. For those who are not aware KYC is part of the anti-money laundering DIRECTIVE 2005/60/EC subsequently amended by DIRECTIVE 2006/70/EC and implemented in Greek Law as No: 3691/2008. The Banking and Credit Committee of the Bank of Greece issued guidance note as Decision No. 281/5/17.3.2009. Alpha bank have issued a leaflet explaining the requirements.

In my case the need to satisfy these requirements was triggered by me informing the bank that I had a new passport. There may be other reasons why the bank might ask for the necessary documents. The requirements are not particularly difficult but there may be some confusion as explained below.

    1 I had to provide my passport as proof of who I am, which is what I was doing anyway. This satisfies items 1, 2, 3, and 4 on the leaflet.
    2 I had to provide my Greek tax statement showing the income declared and tax assessed. This satisfies item 5 on the leaflet. Item 6 was not relevant for me.
    3 I had to produce a DEI and Cosmote landline bill. This satisfies items 7 and 8 on the leaflet

At this point it started to get a bit complicated. Item 9 on the leaflet covers "profession" but if you are retired and living on a pension then they want proof of that. I explained that I had an IKA pension plus a UK State Pension and three UK occupational pensions so they demanded annual statements of income from each of these pensions. I baulked at this and argued that I supplied these certificates to the tax authority and the bank had no legal obligation or authority to demand them. It is the banks job to stop illegal financial transactions not to audit my tax affairs. I pointed out that none of these pensions were paid into Alpha bank and so there was no question as to the bank verifying whether such payments were legal. At this point there was considerable argument too and fro until it became clear that they had not understood that I was tax resident and declaring ALL my income to the Greek tax authority including all my UK pensions. Once they realised that they dropped all requests for certificates of foreign income but still wanted proof that I had an IKA pension. The IKA award statement showing how much I would be paid and from when satisfied that requirement. From that experience I would assume that anybody who is registered as not tax resident in Greece may well have to provide proof of pension payments in the UK. I think a P60 for each income stream would do the trick.

Warwick

PS The above directive has been replaced by DIRECTIVE (EU) 2015/849 which was supposed to be implemented in member states by 27 June 2017. I doubt if it has been enacted in Greek law yet but presumably it will be and then the requirements might change.

scooby
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Location: Agia Nr Chania

Re: Know Your Customer (KYC)

Postby scooby » Thu Aug 31, 2017 2:15 pm

Kilkis wrote:I have just had experience of the KYC regulations and I thought the information gained might be valuable to anyone else who finds themselves having to satisfy their requirements. For those who are not aware KYC is part of the anti-money laundering DIRECTIVE 2005/60/EC subsequently amended by DIRECTIVE 2006/70/EC and implemented in Greek Law as No: 3691/2008. The Banking and Credit Committee of the Bank of Greece issued guidance note as Decision No. 281/5/17.3.2009. Alpha bank have issued a leaflet explaining the requirements.

In my case the need to satisfy these requirements was triggered by me informing the bank that I had a new passport. There may be other reasons why the bank might ask for the necessary documents. The requirements are not particularly difficult but there may be some confusion as explained below.

    1 I had to provide my passport as proof of who I am, which is what I was doing anyway. This satisfies items 1, 2, 3, and 4 on the leaflet.
    2 I had to provide my Greek tax statement showing the income declared and tax assessed. This satisfies item 5 on the leaflet. Item 6 was not relevant for me.
    3 I had to produce a DEI and Cosmote landline bill. This satisfies items 7 and 8 on the leaflet

At this point it started to get a bit complicated. Item 9 on the leaflet covers "profession" but if you are retired and living on a pension then they want proof of that. I explained that I had an IKA pension plus a UK State Pension and three UK occupational pensions so they demanded annual statements of income from each of these pensions. I baulked at this and argued that I supplied these certificates to the tax authority and the bank had no legal obligation or authority to demand them. It is the banks job to stop illegal financial transactions not to audit my tax affairs. I pointed out that none of these pensions were paid into Alpha bank and so there was no question as to the bank verifying whether such payments were legal. At this point there was considerable argument too and fro until it became clear that they had not understood that I was tax resident and declaring ALL my income to the Greek tax authority including all my UK pensions. Once they realised that they dropped all requests for certificates of foreign income but still wanted proof that I had an IKA pension. The IKA award statement showing how much I would be paid and from when satisfied that requirement. From that experience I would assume that anybody who is registered as not tax resident in Greece may well have to provide proof of pension payments in the UK. I think a P60 for each income stream would do the trick.

Warwick

PS The above directive has been replaced by DIRECTIVE (EU) 2015/849 which was supposed to be implemented in member states by 27 June 2017. I doubt if it has been enacted in Greek law yet but presumably it will be and then the requirements might change.
We had the same when we went to update the bank book, I took some papers in,passport, landline bill and Greek tax statement. The lady asked how we manage to live with no income and she was on her toes when I said we were retired but too young for a pension. So this is how the conversation went:

Bank lady: "so we need to see how much savings you have"
Me: "No you don't"
Bank lady: "but how do we know you can support yourself financially?"
Me: "you don't"
Bank Lady: "but you must provide proof"
Me: (by this time getting peed off as don't like banks) "If the tax man asks for proof I shall provide whatever he asks but the bank has no need to know"
Bank lady: "The government has put us in front of the tax man"
Me: "No one has told me that, does that mean I pay any tax due to you?"
Bank lady: "that's not what I mean"
Me: "well that's all I have got in regards paperwork take it or leave it"
Bank lady: "well that will have to do I suppose"
I walked out. Simples :lol:
Men in suits will always make you pay.

Mixos
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Location: North East Crete or S.W.England

Re: Know Your Customer (KYC)

Postby Mixos » Thu Aug 31, 2017 2:43 pm

Your experience with Alpha bank sounds wearisome, Warwick. I went through the same KYC process with Eurobank earlier this year and it was a very short and friendly meeting, in which I handed over the paperwork that you itemise. I am a non-Greek tax resident and the only proof of pension that I gave them was a copy of the annual letter from The Pension Service (BR5899) which sets out "the general increases in benefits" of my state pension. I did not supply information on any other income I may or may not have, since that is no business of the Greek state. Eurobank were quite satisfied with that, so I would advise any other UK taxpayers only to hand over their state pension details (assuming they draw one) and not to furnish their Greek bank with any P60s, copies of UK tax returns, or similar.

Kilkis
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Re: Know Your Customer (KYC)

Postby Kilkis » Thu Aug 31, 2017 3:34 pm

It should be noted that each bank must have a compliance officer and that person has the responsibility to implement policy across the bank that ensures the requirements of the law are met. That can lead to different banks having different requirements. I have an account with another Greek bank who were far easier to satisfy. I asked the manager if it was true that I needed to give them a copy of my tax return each year. He said that it was and had been for a number of years. I asked if he needed the tax statements for all those years and he said that the latest one would suffice. I also took him a copy of my new passport and he said, "Thanks".

Warwick

YoMo2
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Re: Know Your Customer (KYC)

Postby YoMo2 » Fri Sep 01, 2017 9:37 am

Kilkis wrote:.......In my case the need to satisfy these requirements was triggered by me informing the bank that I had a new passport.......


Don't think I will bother telling my bank I have a new passport...............

Andrew
"It's all in the implementation"

Kilkis
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Joined: Sat Apr 21, 2007 3:58 pm
Location: Near Chania

Re: Know Your Customer (KYC)

Postby Kilkis » Fri Sep 01, 2017 11:52 am

YoMo2 wrote:...Don't think I will bother telling my bank I have a new passport...


That's up to you but be aware that for some transactions carried out in a branch they will ask to see your passport. If the passport you show them is not the same as the one they have on record then they may well refuse to carry out the transaction.

It is also necessary to inform the tax office when you get a new passport. They require you to fill in a new M1 form, show the new passport and provide a photocopy of it. Anybody who is registered as not-tax resident here would probably better off doing this through their accountant in case they accidentally get changed to being tax resident.

Warwick

YoMo2
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Re: Know Your Customer (KYC)

Postby YoMo2 » Fri Sep 01, 2017 5:04 pm

Kilkis wrote:
YoMo2 wrote:...Don't think I will bother telling my bank I have a new passport...


That's up to you but be aware that for some transactions carried out in a branch they will ask to see your passport. If the passport you show them is not the same as the one they have on record then they may well refuse to carry out the transaction.

It is also necessary to inform the tax office when you get a new passport. They require you to fill in a new M1 form, show the new passport and provide a photocopy of it. Anybody who is registered as not-tax resident here would probably better off doing this through their accountant in case they accidentally get changed to being tax resident.

Warwick


I'm well known in my local branch and they never ask for my passport. I was aware that my "strategy" would mean I would have to avoid other branches, but I'm not willing to get involved in the protracted paper chase which would likely result from telling them about a new passport. Rock and a hard place really.

Never told the tax office about my passport before? Is this new?

Andrew
"It's all in the implementation"

filippos
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Re: Know Your Customer (KYC)

Postby filippos » Fri Sep 01, 2017 5:56 pm

And one day there'll be a change of staff, maybe temporary, caused by 'flu or holidays and the new teller asks for your Passport which you produce. "I'm sorry sir but this is not the one on record." "Well, the manager knows me." "Perhaps, sir but he's out just now." .............
I had a similar situation. Over several years my 'signature' on the withdrawal slips had morphed into an illegible squiggle, nothing like my sample signature. New teller, "I'm sorry sir, the signature is not correct."
I was lucky; I glimpsed on the teller's screen the style of my original format and produced an acceptable scrawl. I'd have a bigger problem now as they've improved privacy and security. Monitors have been moved so that screens are not visible to customers and there's an electronic gismo on the counter where one now has to sign.
'Er Indoors had a new Passport in April and presented it to a teller who made the necessary change to bank records immediately without further ado. I don't know if that was because we are known to staff.

Kilkis
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Re: Know Your Customer (KYC)

Postby Kilkis » Fri Sep 01, 2017 6:53 pm

YoMo2 wrote:...Never told the tax office about my passport before? Is this new?

Andrew


No, not new. When you first registered for a tax number they took a photocopy of your passport. It's the same situation that can occur with the bank. You go into the tax office to carry out some task. They ask for proof of your identity. You provide a passport that is different from the one they have on record. "Sorry sir that does not match our records." You don't get to carry out the task. If you have an IKA book it would probably also be wise to give them a photocopy of the new one or you might hit the same problem there. Obviously if you never do anything that requires you to produce your passport then it is not a problem. You won't get arrested but it is you that will be inconvenienced if you do encounter the problem so it is in your own interest to inform all relevant organisations. I speak from experience.

Warwick

Tim
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Re: Know Your Customer (KYC)

Postby Tim » Fri Sep 01, 2017 8:38 pm

It's possibly even more convoluted when you activate an atm card. I had to produce:

Passport
Latest Greek tax return
Recent Greek utility bill
Most recent P60 from HMRC
A copy of my contract of employment from work

It still took 30 minutes in the bank. And it was for a card that I hadn't asked but had just turned up in the post.

Tim

SatCure
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Re: Know Your Customer (KYC)

Postby SatCure » Sat Sep 02, 2017 3:11 pm

A few months ago, I triggered this scenario, unwittingly, when I was paying my car insurance in Rethymno. I pulled out my Piraeus debit card to pay - only to see that it had cracked along the magnetic strip.

So, having sorted out the insurance, I crossed the road to the Piraeus bank and took a ticket. Thankfully, mine was the next number as the bank was almost empty (a first!)

I showed the broken card to a teller and she said "no problem, let me see your passport." I don't carry my passport (I know) but I showed her my laminated colour copy of the photo page, which was accepted without question.

"OK, now I need your tax return."

Uh, oh. That's definitely not something I carry. My wife pulled out, from her cavernous handbag, a gift pen with G. Atsalakis phone number on it. The teller phoned the accountant's office and asked that they fax a copy of the document.

"Good, that's on its way. Now I need a copy of a recent utility bill, please."

I was stumped. No way I could get that. She saw the look on my face. "Can you fax me a copy when you go home?"
"No but I can email you a PDF copy."
"Perfect!" she wrote down her personal email address on a piece of paper and typed a few lines into her computer. The fax arrived from my accountant so she glanced at it and typed some more.

"OK, now please go to the corner desk (pointing) where the lady is preparing your new debit card."

I did so, signed a form, and walked out with my new card. It had taken 40 minutes in total.

Back home I emailed the required utility bill (and maybe something else - I don't recall).


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