Collecting records a statement
When a customer gives a name, address, ownership chart or explanation of a transaction, the business has collected information. That information may be useful, but its presence in a form does not mean the business has checked it. Verification is the separate work of testing relevant information against suitable evidence.
Section 28 distinguishes these actions. It requires collection appropriate to the customer's risk and verification using reliable and independent data as appropriate to that risk. The Rules also require policies to state the circumstances for collection and for collection with verification. Staff need to understand the difference.
- Anti-Money Laundering and Counter-Terrorism Financing Act 2006: Section 28(3)(c) to (d)
- AML/CTF Rules 2025: Section 5-2(2)
- Identify the matter
State the fact that needs to be established.
- Collect information
Record what the customer or other source supplies.
- Verify as appropriate
Use reliable and independent data appropriate to the risk.
- Resolve differences
Assess conflicting or missing information.
- Record the conclusion
Explain what was established and what remains uncertain.
From a statement to a checked conclusion
Collection and verification are different actions. The required evidence depends on the applicable duties and risk.
Follow the process from top to bottom.
Match the evidence to the fact
An evidence source can establish one fact without establishing another. A company record may help confirm existence while leaving a particular instruction unexplained. An identity check may concern the contact person but say nothing about authority to act for the customer.
The legal requirement is not satisfied merely by adding the word verified to a file. Identify what was checked, what evidence was used and how it relates to the matter being established. Apply the relevant customer-type requirements as well as the risk-based obligations. Do not assume every fact always needs the same evidence or method.
Worked example: a company chart
A customer supplies a chart showing two individual owners. The chart is collected information. A staff member compares it with other suitable records and finds that one holding passes through another company. The staff member asks about that link and examines the relevant information before recording a conclusion.
This example is not a compulsory sequence for every company. It illustrates why a customer-prepared chart and a checked ownership conclusion are different records. If the source is incomplete or outdated, the note should say so. Copying the chart into a second system does not create independent verification.
Make exceptions visible
A practical file can distinguish collected, checked, unresolved and not applicable matters. Those labels are useful only if their meaning is clear. For example, not applicable should have a reason tied to the customer's circumstances or an applicable provision. It should not be used to conceal missing evidence.
When a normal method fails, determine whether another appropriate method or a specific legal provision applies. Do not invent a successful result to keep the workflow moving. The aim is sufficient confidence in the relevant facts, supported by an explanation another reviewer can follow. More documents alone do not provide that confidence.