As part of the strategy of Česká spořitelna (hereinafter “ČS”) we attempt to eliminate risks such as money laundering or financing of terrorism and detect all possible undesirable activities that arise from them.
What obligations must ČS meet to its customers to eliminate the risk of money laundering or financing of terrorism?
- customer identification
- customer due diligence
- data retention, bank secrecy,
duty of confidentiality
How can we contact you
for mandatory data updates?
What information on prevention of money laundering, financing of terrorism and international sanctions could interest you?
- account owner natural person;
- account owner legal entity, members of the customer’s statutory body and its parent companies, customer’s beneficial owner, person acting on behalf of the customer;
- third party (not an account owner in ČS), who makes a one-off deposit in the account of a ČS customer;
- person handling funds in the account of a ČS customer.
Subsidiaries of ČS (Stavební spořitelna Česká spořitelna, a.s., Factoring Česká spořitelna, a.s., Česká spořitelna - penzijní společnost, a.s., Leasing Česká spořitelna, a.s.) may delegate to ČS the legal obligation to update identification and verification data of their clients, the so-called KYC check. The scope and frequency of regular KYC checks are the same, regardless of whether you are a client of ČS or its subsidiary. And how can ČS contact you for mandatory updates if you are a client of its subsidiary? More information on the channels through which we can contact you can be found below:
a) a natural person, who is or was in a prominent public functions with nation-wide or regional responsibilities, such as a head of state, prime minister, minister, their deputy or assistant minister or a state secretary, member of parliament, member of governing bodies of political parties, leading representative of local government, member of the Supreme Court, Constitutional Court and any other high-level judicial body, decisions of which are not subject to remedies, except in irregular circumstances, member of a central bank board, high-ranking military officer, member or representative of a member of a governing body of a publicly owned business corporation, ambassador or chargé d’ affairs, and/or a natural person who holds or was holding a similar position in another state or in a European Union’s institution, and/or in an international organisation,
b) a natural person, who is
- a close person to the person pursuant to paragraph a),
- business partner or a beneficial owner of the same legal person or a trust as the person pursuant to paragraph a) or who is known to the obliged entity to be a person in any close business relationship to the person pursuant to paragraph a), or
- a beneficial owner of a legal person or a trust known to the obliged entity as incorporated to the benefit of the person pursuant to paragraph a).
On the website of the Financial Analysis Office, the List of National Significant Public Functions and the Consolidated List of Significant Public Functions in the EU and International Organisations with PEP status are available in Methodological Instruction No. 7 of 17.07.2024.
So, for example, a politically exposed person is: the mayor of a municipality with extended powers, the wife of a senator. The law stipulates the obligation of ČS to gain information on the origin of the assets of a politically exposed person. Therefore, ČS requests a customer who is a politically exposed person to fill in a questionnaire on the origin of his/her assets.
On the contrary, a politically exposed person is not for example: a regular member of a political party, a judge of a district court, a mayor of a municipality without extended powers.
Identification is the process when ČS verified your identity according to the submitted identity card, compares that your appearance matches the photograph on your identity card and registers the identification data and data on the identity card in its systems.
Identification data are
a) for a natural person all names and surnames, birth (ID) number, and if not allocated, the date of birth and gender, also the place of birth, permanent or other residence and nationality; if a natural person doing business, also his/her business name, differentiating suffix or other designation, registered office and person’s identification number,
b) for a legal entity
- basic identification data of legal entity that are business names or names, including a differentiating suffix or other designation, registered office and identification number of the legal entity or similar number allocated abroad,
- data for establishing and verifying the identity of a natural person who is a member of its statutory body, and basic identification data of the legal entity which is a member of its statutory body, and data to establish and verify the identity of a natural person who is a member of the statutory body of this legal entity or which this legal entity has authorised to represent it in the statutory body,
c) for a trustits designation and the identification data of its trustee in the scope according to a) and b).
As part of the identification ČS also established whether the customer is a politically exposed person or whether the Czech Republic is imposing international sanctions against it.
If you wish to issue a CS Bank Identity as a means of electronic identification, i.e. for communication with third parties, e.g. government authorities, you must be identified in the CS in your physical presence or through a Bank Identity issued by another bank. The process of identification in physical presence is described in the section Customer identification.
- The value of a transaction exceeds the sum of EUR 1,000
- Each cash deposit made into or withdrawn from the customer’s account
- Establishment of a business relationship
- Suspicious transaction
How is the customer identified?
- The most common way is when the customer is physically present at a ČS branch. The customer’s identity is verified according to a valid identity card. New customers are most commonly verified according to national identity card or passport or residence permit, existing customers also according to a driving licence. The customer’s identity is verified with the establishment and during the course of a business relationship. A proper identification significantly reduces the misuse of the customer’s identity by a third party. There are also non-personal methods of identifying a customer such as identification arranged by a notary public or a public administration contact point, obtaining identification from another bank in the Czech Republic or from abroad, simplified identification, remote identification or identification using an electronic identification tool such as Bank Identity. All these identification methods are regulated by specific procedures for their execution as stipulated by the law.
- During identification a customer that is a natural person doing business submits an extract from the trade licensing or other register that is no older than 30 days.
- A customer that is a legal entity, a trust with its registered office in the Czech Republic, submits during identification an extract from the Commercial Register, an extract from the Trust Register that is no older than 30 days. A customer that is a legal entity, a trust with its registered office abroad, submits during identification an extract from the commercial or similar register in the country of its registered office that is no older than 6 weeks, translated into Czech or English, verified according to valid international treaties (apostille, superlegalization).
A suspicious transaction for ČS is a transaction that leads to suspicion of an attempt at the legitimisation of proceeds of crime or that the funds used in the transaction are intended to finance terrorism. However, this is a very general definition arising from the law.
In a business relationship with the customer ČS should simply monitor and review transactions made during this relationship to establish whether the transactions comply with what it knows about the customer and its business and risk profile. In general, suspicion may be aroused by whatever significantly deviates from the expected transaction profile (credit and debit transactions in accounts but also, for example, funds used to repay credit or for investments). In such case, ČS may request the customer to provide additional information and documents through branch/banker as part of the so-called Customer Due Diligence.
Customer Due Diligence, or KYC (Know Your Customer) due diligence, is a set of measures which ČS implements with regard to the evaluation of the customer’s risk in terms of money laundering, financing of terrorism and enforcement of international sanctions. ČS gains information for KYC due diligence from the customer’s answers in a so-called KYC questionnaire (natural person, enterpreneur, legal entity). This is above all establishing and evaluating the information on the purpose and intended nature of the transaction or business relationship, on the nature of the customer’s business activity, on establishing and verifying the identity of the customer’s beneficial owner, establishing the customer’s controlling and ownership structure, establishing the origin of the assets of a politically exposed person, establishing whether international sanctions are enforced against the customers or persons in its controlling and ownership structure. In specific cases, ČS performs enhanced identification and due diligence, when it required more information from the customer and documents on the origin of funds, on the customer’s business activity in the Czech Republic. In this context it produces scans of documents, for example when identifying aliens.
When is KYC due diligence performed?
- always before entry into a business relationship
- in the course of an existing business relationship
When is enhanced customer due diligence performed?
- at any time for the duration of the business relationship during the review of the customer’s specific transactions or during a suspicious transaction;
- during a deposit made by a third party in a ČS customer’s account.
Enhanced identification and due diligence related to a high-risk third country
In accordance with Section 9a of Act No. 253/2008 Coll., ČS shall perform enhanced customer identification and due diligence prior to a transaction made relating to a high-risk third country and for customers with the country of origin in a high-risk third country with the establishment of a business relationship and during its course and prior to the one-off transaction, if this person is a so-called third party (ČS non-customer). The list of high-risk countries is determined based on Commission Delegated Regulation (EU) 2016/1675 and the list of high-risk countries of the FATF.
- Performing KYC due diligence before the establishment of a business relationship
- Performing regular KYC due diligence during business relationship
- Performing non-cash transactions – ČS has, among other things, the obligation to review transactions made during the business relationship with the customer to establish whether the transactions comply with what it knows about the customer. The customer may be contacted by the branch or other unit of ČS with a request to explain specific transactions. Given that in specific cases the customer’s statement may not be enough, the customer may be asked to present the relevant documentation as proof of the purpose of making the transaction or the origin of the funds he obtained. The customer is obliged by law to provide ČS cooperation in the scope set out by ČS. The relevant documentation means contracts, invoices as well as other types of documents that are specific to this transaction. You can find an illustrative list of this documentation in a special section below..
- Data update – even with a regular update of data that ČS records about the customer there may be a request arising from the customer due diligence. An example may be a request for a close description or proof of the ongoing or expected transaction flow in the customer’s account maintained at ČS.
- Cash operations – The customer KYC due diligence of cash transactions includes, in certain cases, the provision of relevant documentation on the purpose of the transaction and the source of the funds, and, if the cash being deposited was imported from a non-EU country, then in certain situations, the provision of a customs declaration on the import of cash across EU borders. In the case of a cash deposit made by a "non-client" of the CS, the client's cooperation in the due diligence is the provision of information and documents on the purpose of the transaction and the source of the funds. In the case of a transaction carried out by a 'non-client' of a CS natural person doing business, the due diligence includes the provision of information on the nature of its business activity and, in the case of a 'non-client' of a CS legal entity, documentation on its management and ownership structure and beneficial owner.
If the customer stated the facts given below as the source of the funds, ČS can request, for example, the following additional information and documents to verify them:
In case that the customer is a legal entity or trust, ČS is obliged to establish its ownership and controlling structure and beneficial owner. The controlling structure is the customer’s statutory body and in so-called second controlling level the statutory body of all its parent companies. The ownership and controlling structure as well as the beneficial owner need to be verified by a trustworthy source, i.e. most commonly from the extract from a public register kept in the Czech Republic or in another country from the annual report and list of shareholders. In the case of a branch office, ČS establishes the ownership structure and beneficial owner of the legal entity which is its founder.
As part of customer due diligence, ČS is obliged to establish the identity of the beneficial owner and take measures to verify its identity from trustworthy sources. This can be established for example from an extract from a public register kept in the Czech Republic or in another country, annual report, list of shareholders, usually no older than 1 year. In case that the customer is subject to the obligation to register in the Register of Beneficial Owners or similar register, ČS must verify the beneficial owner always at least from this register or a similar register and one other source, while also taking into account acting in concert.
ČS is obliged to verify with persons in the customer’s ownership and controlling structure and with the beneficial owner whether they are a sanctioned entity or politically exposed person.
Every customer is obliged at the request of ČS to provide information, which are necessary for performing due diligence, including submission of the relevant documents. If the customer does not provide such cooperation or it is not possible to perform customer due diligence for a different reason, ČS shall proceed as stated below in the section “Rejection of Transaction”.
Rejection of Transaction
As we have already stated above, the obligation of ČS to perform customer due diligence is stipulated by the law. Likewise, the customer is obliged to provide ČS when performing customer due diligence.
In view of these facts, the law also stipulates that ČS is obliged declines a transaction or refuses to enter into a business relationship, if the customer, among other things, refuses to provide the necessary cooperation during due diligence. ČS will refuse to make a transaction or establish a business relationship even in that case, when it has doubts about the veracity of the information provided by the customer or the veracity of submitted documents. If the customer subsequently insists on making a transaction or establishing a business relationship, he has no alternative but to provide ČS with appropriate cooperation. In case that ČS were to make a transaction or establish a business relationship even without the cooperation of the customer, it itself becomes open to regulatory sanctions.
How long does ČS retain information and documents?
The data retention period is regulated in relevant legislation that applies to the activity of ČS.
If a business relationship is established, ČS processes data including personal data throughout the business relationship as well as information and documents obtained during customer identification and due diligence.
ČS processes these data for 10 years after termination of the last business relationship with the customer or transaction outside the business relationship.
If a business relationship is not established (there was interest in a product or service, but no contract/agreement was concluded), ČS processes the data, including personal data for a maximum of 1 year.
In the data protection section on the ČS website you can find the Principles of Personal Data Processing in ČS, where you can become acquainted in more detail under what conditions ČS processes personal data required for providing products and services. The document can be also downloaded in pdf.
Bank secrecy and duty of confidentiality
Bank secrecy and duty of confidentiality are regulated by the relevant legislation that applies to ČS and its employees.
Bank secrecy applies to all bank transactions, bank cash services, including account balances. Bank secrecy may be breached only in exceptional cases. For example, such exceptions are made for law enforcement authorities, for administrative authorities, the regulator, etc.
All ČS employees are obliged to maintain confidentiality in matters applying to customers, even after the termination of their employment or other relationship in ČS.
International sanctions are restrictive measures that international communities (UN) and EU use as an instrument to maintain or restore international peace and security, to protect fundamental human rights and to combat terrorism. They are adopted by a resolution of the UN Security Council (UN SC), a decision of the EU Council and regulation of the EU Council or European Commission respectively. Individual states can issue their own sanctions (such as the USA).
International sanctions in the Czech Republic are regulated by Act No. 69/2006 Coll. (Act on Carrying out International Sanctions).
When executing payments with countries that are subject to certain restrictions, the bank may perform due diligence of individual payments to rule out breach of international sanctions.
Countries and specific measures that are subject to international sanctions or embargoes are found in the EU sanctions map.
Apart from international sanctions declared by the UN and EU, ČS also observes sanctions declared by the United States of America. These sanctions are administered by the Office of Foreign Assets Control (OFAC). For more information visit the website of this office.
When trading with a country that is subject to sanctions or embargoes or with a country considered high risk we recommend that customers increase their vigilance and preparedness. This particularly concerns the provision of relevant documents at the request of the bank in accordance with Section 9 of Act No. 253/2008 Coll. The bank needs these documents to assess whether international sanctions and embargoes are being breached.
For more information on the enforcement of international sanctions visit the web site of the Financial Analytical Office responsible for enforcing international sanctions in the Czech Republic.
In the area of prevention of money laundering, financing of terrorism and international sanctions, ČS, as the obliged party, follows the following regulations:
- Act No. 253/2008 Coll., on Selected Measures Against Legitimisation of Proceeds of Crime and Financing of Terrorism, as amended
- Act No. 37/2021 Coll., on Registration of Beneficial Owners, as amended
- Act No. 69/2006 Coll., on Carrying out of International Sanctions, as amended
- CNB Decree No. 67/2018 Coll., on Selected Requirements for the System of Internal Rules, Procedures and Control Measures Against Legitimisation of Proceeds of Crime and Financing of Terrorism, as amended
and other, for example:
The supervisory authority for the proper supervision of compliance of ČS obligations stipulated by Act No. 253/2008 Coll. is the Financial Analytical Office and the Czech National Bank. The Financial Analytical Office also performs due diligence of whether there is legitimisation of proceeds of crime or financing of terrorism.
- Wolfsberg Group Correspondent Banking Due Diligence Questionaire (CBDDQ) v1.3
- Statement of Česká spořitelna On the Policy on Anti-Money Laundering and Combating the Financing of Terrorism
- Banking Licence
- Commercial Registry Board of Directors
- CRS Statement & FATCA General Information
- Form W8BEN-E
- Erste Group Bank AG - Shareholder Structure Development
- UBO Declaration_shareholder structure of CS