A Trust is a legal entity which has a Trustee(s), Trust property and Beneficiaries. A Trustee owns and manages the Trust’s assets. They do this for the benefit of people known as the Beneficiaries. The person who establishes the Trust is called the Settlor.
To comply with AML/CFT legislation there are additional things that you need to do when a Trust is involved.
A ‘Trust Deed’ is a legal document that holds all the relationships together and defines how the Trustees with operate the Trust. Trusts are created as a way to separate and protect assets and to preserve wealth for others. For things like future generations or causes or purposes. For example a Trust can be created by grandparents who wish to allow their assets to be used for the benefit of their grandchildren.
Because Trusts can provide a level of anonymity to who is owning or controlling assets or money, a higher level of due diligence is required for Trusts. 2Shakes has been designed in to help you capture additional Trust information in line with the Department of Internal Affairs (DIA) Trust Fact Sheet.
If a Trust is your client or customer, add them as an organisation. The Trustee can be added as the main contact (not signing up as an individual). If it is an agreement that other Trustees need to sign, make sure that the Trust is the only entity on the agreement. Then you can add additional people to sign on the signatories and parties screen.
Under AML, when a Trust is the customer, you will need to capture additional information about the Trust. You should ask for a copy of the Trust deed in order to help you do this.
AML requires that you determine who the beneficiaries of the Trust are. You need to record different beneficiary information depending if a Trust is:
2Shakes has a Trust tab to help you record this information. You may also need to complete Customer Due Diligence on the Settlor, the Trustees or anyone else who is a Beneficial Owner of the Trust. You can also add these people for IDV from within the Trust tab. A Trust should elevate the Customer Due Diligence level to Enhanced. Find out how we help you perform Enhanced Customer Due Diligence.
When your customer is owned by a Trust you will need to determine any of the people involved with the Trust that you should identify. The Trustee, Beneficiaries and Settlors should all be considered as part of CDD. 2Shakes identifies possible Trusts who are shareholders and presents you with the information listed on Companies Office against the allocation of shares.
Use this link to find out more information about AML in 2Shakes.