Dermot Ahern (Louth, Fianna Fail)

These amendments arise in section 37 which provides for enhanced customer due diligence to be carried out in regard to persons who are politically exposed persons. The provisions being amended are those dealing with the requirements that designated persons obtain approval from senior management before a business relationship is established with a politically exposed person and determining the source of wealth and funds involved in such business transactions. The amendments have the effect of setting out the provisions more clearly, thereby achieving greater clarity. For this reason, there has been a reordering of subsection (4) which now also specifically states the requirements apply if a person knows or has reasonable grounds to know that a person is a politically exposed person.

The amendment to subsection (6) in regard to a beneficial owner reflects the same approach as adopted in subsection (4). The amendments to subsection (7) specify clearly the circumstances in which a designated person is deemed to know that a person is a politically exposed person for the purposes of subsections (4) and (6), on which there are reasonable grounds for concluding that the designated person so knows.

The amendment to subsection (8)(a) arises essentially from the previous amendments and reflects the fact that the determination of the source of wealth and funds is an ongoing responsibility. It is, therefore, more appropriate to provide that the designated persons should discontinue the business relationship, if any, in the circumstances stated. It is also consistent with the other provisions in the Bill, for example, section 33(8).

Amendment agreed to.

Government amendment No. 14:

In page 37, line 17, to delete "(4)(b)" and substitute "(4)(a)".

Amendment agreed to.

Government amendment No. 15:

In page 37, line 20, to delete "(4)(b)" and substitute "(4)(a)".

Amendment agreed to.

Government amendment No. 16:

In page 37, to delete lines 25 to 32 and substitute the following:

"(6) If a designated person knows or has reasonable grounds to believe that a beneficial owner residing in a place outside the State, and connected with a customer or with a service sought by a customer, is a politically exposed person or an immediate family member or close associate of a politically exposed person, the designated person shall apply the measures specified in subsection (4)(a) and (b) in relation to the customer concerned.".

Amendment agreed to.

Government amendment No. 17:

In page 37, to delete lines 33 to 40 and substitute the following:

"(7) For the purposes of subsections (4) and (6), a designated person is deemed to know that another person is a politically exposed person or an immediate family member or close associate of a politically exposed person if, on the basis of—

(a) information in the possession of the designated person (whether obtained under subsections (1) to (3) or otherwise),

(b) in a case where the designated person has contravened subsection (1) or(2), information that would have been in the possession of the person if the person had complied with that provision, or

(c) public knowledge, there are reasonable grounds for concluding that the designated person so knows.".

Amendment agreed to.

Government amendment No. 18:

In page 37, line 45, to delete "not establish any business relationship" and substitute "discontinue the business relationship (if any)".

Amendment agreed to.

Bill reported with amendments.

Government amendment No. 19:

In page 37, line 47, after "service" to insert "or carry out the transaction".

Amendment agreed to.

Amendments Nos. 20 and 21 not moved.