Generally, the first step of identifying the beneficial owner (BO) as referred to in "…situations in which ownership or control is exercised through a chain of ownership.." is by identifying the shareholders and directors, not the individuals appointed as executives e.g. CEO, CFO, COO, unless these executives are also the shareholders or directors.

The "chain" here is in relation to parent-subsidiary situations which extend across several levels, where the reporting institutions will need to review the entire chain of companies and subsidiaries to determine who is the ultimate beneficial owner of a particular customer that the reporting institution is dealing with.

However, reporting institutions should be aware that for BO of a legal person, if the natural person cannot be identified through the controlling ownership interest, then the senior management of that legal person e.g. CEO, CFO, COO or similar position is to be identified as the BO.

Details on the above sequential process to identify the BO can be found in the following paragraphs of the Policy Document:

1. Banking and DTIs -  paragraph 14A.9.6
2. Insurance and Takaful - paragraph 14B.11.12
3. MSB - paragraph 14C.10.7
4. NBIs - paragraph 14D.9.6

For further details on beneficial owner, please refer to the “Guidance on Beneficial Ownership” issued by Bank Negara Malaysia.

GLCs refer to entities where the government is:

1. the majority shareholder; or
2. the single largest shareholder; and / or
3. has the ability to exercise and / or influence major decisions such as appointment of board members and senior management.

The definition would also be applicable in instances where the government is not a single largest shareholder but is able to exercise control e.g. through golden shares (where the government is entitled to certain special rights).

This may also include state-owned corporation (SOC) which is a body formed by the government through legal means to be able to take part in activities of a commercial nature. As activities of a state-invested entity (SIE) also involve investment on behalf of the government, they may be treated the same as SOCs and GLCs.

PCT is defined in paragraph 6.2 of the Policy Document and refers to any natural person conducting or purporting to act on behalf of the customer, such as person depositing into another customer’s account or person undertaking a transaction on behalf of another person.

Examples of PCT may include the following:

1. a third party conducting money services transactions on behalf of the customer e.g. an employer remitting on behalf of foreign employees / workers or a travel agent exchanging monies on behalf of tour groups;
2. a company representative making payments on behalf of the company; or
3. a third party paying on behalf of an account holder or policy holder e.g. a parent or guardian performing a transaction on behalf of the child who is the account holder or policy holder or a third party making repayment to loan accounts.

A nominee is a person that the insured person under an insurance policy or takaful certificate chooses or nominates to receive the policy moneys / takaful benefits from the insurance policy or takaful certificate, upon the death of the policy owner / takaful participant.

Nominee is included under the definition of “beneficiary” in paragraph 6.2 of the Policy Document.