CySEC AML · Chapter 6 · Topic 4 of 14

How do you verify an individual's identity and address?

What a firm collects from individual customers, which documents prove identity and address, and the extra steps for customers who live abroad.

By the ExamPass CY editorial teamLast reviewed 25 September 20264 min read

Tested inAML · Ch 6 Advanced · Ch 7 Basic · Ch 8

Short answer

Identity is verified against an original photo document, such as a passport or national identity card, issued by a reliable and independent source; the firm then keeps copies it certifies as true. The permanent address is verified separately, by a home visit recorded in a memo or by an original utility bill, local tax bill, bank statement or similar document no more than six months old. For customers living abroad, the firm also asks about public positions held in the last 12 months.

What the firm collects and checks

Item	Requirement
Basic details	Full name and any other names used, nationality, date and place of birth, permanent address with postcode, phone and email, and occupation, position and employer
Identity document	Original, issued by a reliable independent source, with the customer's photo, such as a passport or national identity card
Copies	The pages with the relevant details, certified by the firm as true copies of the originals
Proof of address	A home visit recorded in a memo, or an original utility bill, bank statement, local authority tax bill or similar document up to 6 months old
Customers living abroad	An identity document is always required, with certified true copies of the relevant pages kept; public positions held in the last 12 months, and whether they are a close relative or close associate of someone holding one
Doubtful foreign document	Check with the issuing country's embassy or consulate, or a reputable bank or financial institution in the country where the customer lives

Source: CySEC Directive for the Prevention and Suppression of Money Laundering and Terrorist Financing.

Why are identity and address verified separately?

An address is part of a person's identity, but it needs its own evidence. The same document or data may never be used to verify both the customer's identity and their home address. A passport proves who someone is; a recent bill, a bank statement or a visit to the home proves where they live.

Terms used in this note

Politically exposed person (PEP): Someone who holds or has held a prominent public function, together with their close family members and close associates. PEPs require enhanced due diligence.
Certified true copy: A copy confirmed as matching the original by an authorised person who has seen the original. For identity documents shown in person, the firm certifies its own copies.

What extra checks apply to customers who live abroad?

Customers who do not normally live in Cyprus must always provide an identity document, and the firm keeps certified true copies of the pages with the relevant details. The firm also asks about public positions held in the last 12 months, and whether the customer is a close relative or close associate of someone holding one, to find out whether the customer is a politically exposed person.

The document's number, issue date and issuing country, and the customer's date of birth, should be visible on the copies kept. That lets the firm screen the customer precisely against UN and EU financial sanctions lists.

Can an introduction help verification?

It can strengthen verification, never replace it. The check is reinforced when the customer is introduced by a reliable member of staff, or by a reliable existing customer whom a board member knows personally. The details of the introduction go into the customer's file.

How to think about it

Think original, photo, recent. Identity comes from an original photo document issued by a reliable, independent source, and the firm certifies its own copies. Address comes from separate, recent evidence: a home visit, or a bill or statement no older than six months. If a foreign document looks doubtful, check with that country's embassy or consulate, or a reputable bank in the country where the customer lives.

Common mistakes

Verifying a customer met in person against a photocopy. Verification is against the original, and the firm then certifies its own copies. Remote customers are verified by other approved means, such as electronic identification.
Using one document for both identity and address. Each needs separate evidence.
Accepting an address document older than six months. Utility bills, tax bills and bank statements must be recent.
Relying on an introduction instead of documents. An introduction reinforces verification but never replaces it.
Asking the customer to vouch for a doubtful foreign document. CySEC advises checking with the issuing country's embassy or consulate, or a reputable financial institution in the customer's country of residence.

Legal references

CySEC Directive for the Prevention and Suppression of Money Laundering and Terrorist Financing, as amended (opens in a new tab)
The Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2007 (Law 188(I)/2007), as amended (opens in a new tab)
Article 61(1)(a) (identifying and verifying the customer)
Law 58(I)/2016 on the implementation of UN Security Council sanctions and EU restrictive measures

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Topic 5How do you verify a company or other organisation?The entity, its directors, its beneficial owners and everyone who can operate the account.Topic 6What is a customer's economic profile?The expected pattern of activity that ongoing monitoring is measured against.Topic 9When is enhanced due diligence required?Extra measures for politically exposed persons, high-risk countries and other higher-risk cases.