What is a UBO report?
A UBO report from CreditorWatch is the more efficient way to comply with regulations and identify the beneficial owners of your customers. CreditorWatch customers can download a UBO report directly from their dashboard with a click of a button.
Our sophisticated software scans ASIC reports and calculates ownership percentages to generate an easy-to-read PDF report.
- Easily identifies non-individual customers
- Identifies risk posed by the beneficial owners of your customers
- Simple, easy-to-read report for quick reference
- An efficient way to comply with the AML/CTF Act
- Saves time and money
Who is a beneficial owner?
A beneficial owner is an individual or non-individual who controls or owns at least 25% or more of a company’s shares. It’s essential to identify the beneficial owners of your customers to meet the requirements of AUSTRAC’s AML/CTF legislation.
There can be multiple beneficial owners within a company and these can include individuals and/or other holding companies. This can make it time-consuming and complicated to identify the beneficial owners yourself. CreditorWatch’s UBO report does this for you.
Individual X is a beneficial owner because they directly own 25% of Customer PTY LTD.
Individual G is a beneficial owner because they hold 80% of the units in C Trust (a unit trust) which in turn owns 80% of A PTY LTD, which owns 50% of Customer PTY LTD (meaning Individual G has an indirect .8 x .8 x .5 = 32% ownership of Customer PTY LTD).
Individual Y is a beneficial owner because they have two interests that collectively amount to an indirect 25% of Customer PTY LTD:
- The first is their 20% interest in A PTY LTD, which owns 50% of Customer PTY LTD (providing an indirect .2 x .5 = 10% ownership of Customer PTY LTD).
- The second is their 60% interest in B PTY LTD, which owns 25% of Customer PTY LTD (providing an indirect .6 x .25. = 15% ownership of Customer PTY LTD).
- Adding these together, Individual Y has a 10% + 15% = 25% interest in Customer PTY LTD.
Why is it essential to identify beneficial owners?
Some businesses have an obligation to meet the KYC (Know Your Customer) requirements of AUSTRAC’s AML/CTF program. By identifying and verifying your customers and their financial activities, you can mitigate risk of money laundering and terrorism financing.
It is crucial for businesses in certain industries to comply with KYC/AML (anti-money laundering) regulations. To comply, you need to:
- 1. Assess the money laundering/terrorism risk posed by the beneficial owners of your customers
- 2. Determine the identity of the beneficial owner(s) of your non-individual customers
- 3. Collect and take reasonable measures to verify each beneficial owner’s identification information such as full name, date of birth and residential address.
- 4. Keep records of the beneficial owner identification processes to comply with Division 3 of Part 10 of the AML/CTF Act 2006
- 5. Document how you will fulfil your obligations in the AML/CTF program