Know Your Client (KYC) procedures have been applied in the superyacht industry for over 10 years, but recent world events have put them back in the spotlight. The international yacht charter industry must adhere to international standards and regulations for Anti-Money Laundering (AML). Here we explain what is now required for chartering yachts, along with some recommended resources.
KYC refers to obtaining and verifying essential information about a Client to ensure compliance with regulations, prevent fraud, and manage risks. To complete the KYC process, the Charterer (the person paying for the charter), will be requested to provide official identification documents, proof of address, and other relevant personal information before signing the Charter Agreement.
Identity Verification for High-Value Transactions
| KEY COMPONENTS | DESCRIPTION |
| Client Identification | Verify YOUR identity and ensure authenticity through KYC activities. Example: (Picture ID) |
| Document Collection | Request documentation to support YOUR (the client’s) claims and transaction legitimacy. Example: (Utility Bill or showing legal residence address) |
| Sanction Check | Ensuring YOU (the client) or your CHARTER GUESTS are not listed on “sanction or frozen asset” lists. Sanctioned individuals can’t be on board the vessel, at all. They can’t charter in their name, and they can’t be guests. They are not allowed to enjoy or benefit in any way from the service being provided. |
| Purpose Assessment | Evaluating the intention behind the transaction to ensure it aligns with legal standards. |
| Source of Funds | Determine the origin of YOUR (the client’s) funds to prove licit financial activities. |
Thank you for helping us with this important process. Information we collect from you for transactions is held by us in a protected database and we share it only with the Stakeholders such as our escrow account bank and the Yacht Management Company that represents your intended yacht.
Additional Recommended Source: Three components of KYC include the customer identification program (CIP), imposed under the USA PATRIOT Act in 2001, customer due diligence (CDD), and ongoing monitoring or enhanced due diligence (EDD) of a customer’s account once it is established.
