Customer due diligence
Pursuant to the Finnish Act on Credit Institutions, a bank is required to know its customers. This is why all Finnish banks request their customers to present personal identification, for example, when establishing a new customer relationship. Banks are also subject to various legislation aimed at preventing, for example, money laundering, terrorism and financial crime in this era of globalisation in monetary transactions.
In addition to personal information, the bank must have sufficient information on, among other things, the customer’s transactions, financial status and the source of funds. At first, these questions may seem strange, unexpected and even intrusive. However, by providing the information we request, you support our efforts against criminal activities and fulfil your responsibility towards society. All information provided by you will be handled confidentially pursuant to the legislation governing bank secrecy.
For example, we may ask you about the source and purpose of funds that are deposited or transferred into your account. To determine the source of funds, we may require documents such as deeds of sale in addition to a written account of the source of the funds.
The bank must also establish, among other things, whether you are a politically exposed person (PEP) in another state or a family member or close associate of such a person. This does not, however, mean that we will ask you about your political views. The legislation has its roots in international regulations, which is particularly reflected in this context: in the eyes of legislators, an influential position provides exceptional opportunities for receiving bribes and concealing their source, for
example.
More information: Finnish Financial Supervisory Authority
The bank does not ask these questions to hassle you or pry into your affairs. Instead, the bank asks these questions in order to fulfil the statutory requirements stipulated by the Act on Detecting and Preventing Money Laundering and Terrorist Financing. The purpose of the law is to prevent the conversion of criminally acquired funds into legal funds – known as money laundering – and the channelling of funds to support terrorist activities.
When a customer uses the services of a bank – for example, in relation to a loan – it is natural to have to respond questions about income and expenses. However, similar questions are also asked in conjunction with the use of other banking services, including enquiries regarding political influence and tax liability. The questions also extend to international monetary transactions. Having this information helps us protect our customers’ funds against various abuses.
As part of fulfilling the customer due diligence requirements, the bank must determine whether the customer holds a position of political influence.
The current regulations on political influence apply to persons who currently hold, or during the past year have held, an important public position in another state, as well as the family members and close associates of such persons.
Examples of important public positions include being a head of state, member of parliament, senior judicial official or ambassador. This means that the bank does not ask questions regarding political position in order to assess the customer’s activity in domestic politics. Instead, the purpose if to satisfy the legal requirement according to which establishing a customer relationship with a politically exposed person is subject to the branch manager’s approval.
The question is asked of each new customer and, if necessary, the information is updated during the customer relationship.
The bank also asks customers about their tax liability in the United States. This question is based on the treaty between Finland and the United States regarding the exchange of tax information. The treaty stipulates that banks must determine which of their customers are liable to pay tax in the United States. The banks report this information to the Finnish Tax Administration, which then passes the information on to the Internal Revenue Service in the United States.
Customers can also submit this information online.
More information: Finnish Financial Supervisory Authority
Banking is based on maintaining trust and banking secrecy between the customer and the bank. Trust is created by good service, customer due diligence and the right banking solutions. At Savings Bank, we ask you a variety of questions – not only to satisfy our legal obligations, but also because we want to know you and understand your current life situation. This way we can give you better banking advice and offer you banking services that suit your specific needs. First and foremost, the bank knowing the customer serves the customer’s interests.
In the past, when people visited banks more frequently, the bank employees and customers got to know each other. With the emergence of online services and new operating methods, customers visit banks less frequently and the traditional personal relationships are not necessarily established anymore. Legislation has also changed over time. Nevertheless, banks are still required to identify and know their customers.
The bank has an obligation to verify the customer’s identity by means of an official and undamaged identification document. This applies to both existing and new customers.
The customer’s identity is verified by means of a valid personal identification document. Official identification documents include a passport and a personal identification card. Kela cards with the holder’s photograph as well as driving licences issued by the Finnish authorities are also accepted in banking, subject to certain restrictions.
The service provider must verify the customer’s identity. The verification of identity must be based on a reliable document issued by an independent source. The document must support the unequivocal verification of the person’s identity and personal information. The reliability and authenticity of the document must be verifiable using public sources. Otherwise, the customer will be requested to provide additional clarification for the verification of his or her identity.
In Finland, only passports and personal identification cards issued by the police are intended specifically for the verification of identity. The process of issuing a driving licence does not involve the same degree of scrutiny and security as a passport or personal identification card.
The customer must be identifiable based on his or her identification document. This may be problematic in the case of old paper driving licences and the outdated photographs on them. Old paper driving licences issued before 1 October 1990 are accepted for banking if the customer can be indisputably identified based on the document.
Driving licences issued by foreign authorities are not accepted as identification documents in banking. Driving licences obtained in Finland in exchange for a foreign driving licence are also not accepted, as they represent a certificate of the holder’s right to operate a vehicle rather than a document verifying his or her identity.
The identity of a natural person must be verified by means of reliable documentation, i.e. one of the following documents issued by the Finnish authorities:
- A driving licence (NB! for pre-1990 red paper licences, the person presenting the document must be identifiable from the photograph)
- An identity card issued by the Finnish police.
- A passport (including alien’s passports and diplomatic passports)
- A refugee travel document
- A Kela card with the holder’s photograph
The following valid documentation can be used to verify the identity of a natural person who is not a Finnish citizen:
- A passport issued by a foreign authority
- An EU identity card accepted in the Schengen area as a citizen’s travel document
The identity of a legal person must be verified by means of reliable documentation, such as:
- A trade register extract
- A corresponding extract from some other public register.
Natural persons acting on behalf of a legal person must be identified and their identity must be verified where necessary. In addition, the natural person’s right to represent the legal person must be verified by means of a trade register extract or power of attorney, and the beneficial owner must be determined. The beneficial owner must always be identified and the beneficial owner’s identity must be verified (Act on Detecting and Preventing Money Laundering and Terrorist Financing, Section 8).
More information: Finnish Financial Supervisory Authority
In addition to the verification of identity, customer due diligence requires that the bank has sufficient information on the customer’s financial status, business activities and the purpose of using banking services. This is why the bank asks, among other things, for information on the funds coming into and going out of the account, their source and purpose, as well as any international payments and their amounts.
When using our online banking services, you may come across our questionnaire that asks you to update your personal details as well as information related to your use of banking services. Among other things, the questions cover the respondent’s nationality, country of birth, country of taxation and the source of funds deposited or transferred into the account in Savings Bank. The questions are the same as those we use in face-to-face meetings at our branches. You can also submit your information online at your own initiative. A secure connection to online banking is a safe and convenient way for the customer to provide the necessary information.
The questions are answered securely on the online banking platform after user identification. When you use online banking services, you can confirm the website’s security and SSL encryption by clicking the padlock icon shown on the upper or lower bar of your browser software. We also want to remind you that we will never ask you for your personal banking codes, card information or personal ID code by e-mail or telephone.
We urge you to be vigilant when using online services or opening e-mail messages or links from unfamiliar sources. Exercise care in how you keep and use your banking codes. We advise against giving other people access to your accounts. You should also confirm that the device you use is protected, with up-to-date anti-virus software and a functional firewall.
The questions are answered securely on the online banking platform after user identification. When you use online banking services, you can confirm the website’s security and SSL encryption by clicking the padlock icon shown on the upper or lower bar of your browser software. We also want to remind you that we will never ask you for your personal banking codes, card information or personal ID code by e-mail or telephone.
We urge you to be vigilant when using online services or opening e-mail messages or links from unfamiliar sources. Exercise care in how you keep and use your banking codes. We advise against giving other people access to your accounts. You should also confirm that the device you use is protected, with up-to-date anti-virus software and a functional firewall.
Why does the bank ask for customer information via the online banking platform?
Banks have a legal obligation to know their customers and how their banking services are used.
We collect and update this information flexibly by using the channels preferred by our customers. A secure connection to online banking is a safe and convenient way for the customer to provide the necessary information.
Who will be asked to provide this information?
Information updates are requested from all customers who use our online banking services. We kindly request that all customers check their personal information and update it as necessary.
If there is a change to the information I have previously provided, do I need to complete the questionnaire again?
You can update your customer identification details on the online banking service. We also update this information when we meet you in person at our branches.
Will the questionnaire also be shown on the mobile banking platform?
While the questionnaire cannot be updated on the actual mobile versions of our online banking service, our online banking services are responsive websites that are easy to access on mobile devices.
Where can I get help? Who can I send feedback to regarding the online banking questionnaire?
In case of any problems or feedback, please contact your local Savings Bank.
The online banking codes used by Savings Bank constitute strong electronic identification pursuant to the Act on Strong Electronic Identification and Electronic Signatures. The law requires that the verification of the customer’s identity in conjunction with issuing online banking codes is based on a valid personal identification document of the type specified in the Act.
If the bank is unable to obtain sufficient information with respect to customer due diligence, the bank has a legal obligation to refuse to establish a customer relationship or carry out the customer’s transaction.
For these reasons, we will ask you certain questions when you become a Savings Bank customer and subsequently when you use our services at our branches, on our online banking service or by telephone. The information is handled confidentially in accordance with the Finnish regulations on banking secrecy.
Banks have a legal obligation to know their customers and how their banking services are used.
We collect and update this information flexibly by using the channels preferred by our customers. A secure connection to online banking is a safe and convenient way for the customer to provide the necessary information.
Who will be asked to provide this information?
Information updates are requested from all customers who use our online banking services. We kindly request that all customers check their personal information and update it as necessary.
If there is a change to the information I have previously provided, do I need to complete the questionnaire again?
You can update your customer identification details on the online banking service. We also update this information when we meet you in person at our branches.
Will the questionnaire also be shown on the mobile banking platform?
While the questionnaire cannot be updated on the actual mobile versions of our online banking service, our online banking services are responsive websites that are easy to access on mobile devices.
Where can I get help? Who can I send feedback to regarding the online banking questionnaire?
In case of any problems or feedback, please contact your local Savings Bank.
The online banking codes used by Savings Bank constitute strong electronic identification pursuant to the Act on Strong Electronic Identification and Electronic Signatures. The law requires that the verification of the customer’s identity in conjunction with issuing online banking codes is based on a valid personal identification document of the type specified in the Act.
If the bank is unable to obtain sufficient information with respect to customer due diligence, the bank has a legal obligation to refuse to establish a customer relationship or carry out the customer’s transaction.
For these reasons, we will ask you certain questions when you become a Savings Bank customer and subsequently when you use our services at our branches, on our online banking service or by telephone. The information is handled confidentially in accordance with the Finnish regulations on banking secrecy.
Sanctions are monitored in Savings Bank customer relationships and payment transactions. The subjects of sanctions can include specified countries as well as individuals and organisations deemed to be responsible for the activities that the sanctions are imposed against. Savings Bank monitors, among other things, the EU, UN and US sanctions lists as well as the national list of administrative decisions issued for the prevention of terrorism, which involves freezing the assets the decision concerns.
Finance Finland has published a PDF brochure entitled “Why does the bank ask these questions?” regarding customer due diligence on its website.