Chapter 11: Freezing and Updating of the Accounts
Freezing of General Account at the Expiration of Validity of Identification Document(s)
126. As a rule, dealings between DTFCs and their customers and their relationship must start and continue in all aspects under valid ID documents, including dealings covered under the account definition or other contractual dealings or account related services.
127. All DTFCs must freeze all General Accounts of juristic entities after 90 days from the expiration date of the respective authorization to practice their activity (license, commercial registration, etc.) unless the customer provides a renewed authorization or any document.
128. All DTFCs must freeze all General Accounts of juristic persons whose documents of opening their accounts do not contain a validity date as of the date of opening the account or as of the date of last updating made on such accounts.
129. The validity of the ID cards of the directors and authorized signatories of the accounts of such persons and entities must be monitored, and their powers to operate the account only shall suspend, depending on their position as Saudis/non-Saudis, until renewal of their IDs. This requirement shall also be applicable to owners of private establishments and companies except Listed Joint Stock Companies and Government entities.
Specific General Account Freezing Rules
130. In the account opening form and contractual relationships and services, DTFCs must document that the DTFCs has the right to freeze the account upon the expiration of the customer's ID or when the account holder's data and information, addresses, incomes sources and signatures etc. are not updated.
131. All DTFCs must notify their customers of the date of freezing their respective accounts at least one month prior to the date of freezing, and must have adequate programs and processes in place to ensure the same with respect separately to each customer or authorized person acting on his behalf and that such policy and processes are documented.
132. Juristic persons and organizations (official and private) are allowed to close their own accounts, or any frozen accounts they are authorized to operate, by reason of the expiration of the validity of their IDs or failure to update them, provided that a written request for this purpose is submitted by the customer and the implementation related to closeting accounts.
133. Transferring the account to unclaimed balances means transferring it to a special database without closing it. Each DTFCs can follow its own policies and procedures that fit to its own operational needs and fulfill this requirement.
Term Deposit Account Freezing Rules
134. In case of a Term Deposit Account linked to a frozen General Account, DTFCs should continue the deal until maturity. Upon maturity, DTFCs must credit the full principle and profit amount (separately) to the frozen General Deposit Account.
135. DTFCs can book a new Term Deposit Deal or an automatic rollover Term Deposit from a frozen General Account based upon the instruction of the account holder keeping in mind that DTFCs will always credit the funds to the frozen General Account upon maturity of the Term Account.
Freezing Exceptions
DTFCs must not allow an account holder or it authorized managers to withdraw from the relevant frozen accounts in any form whatsoever except for the following conditions:
136. The customer existing obligations already effected by the DTFC in term of charges before the expiration of the ID (of account holder/ authorized representative).
137. Standing instructions from SAMA or Department of Justice relating to settlement of a case.
Updating Account Data
138. DTFCs must establish customer identification at the outset of relationship.
139. As a measure of control, DTFCs must require all their customers to update the database of their General Accounts with the DTFCs periodically based on the risk rating policies established with a maximum limit of five years.
140. Updating of the General Account must include personal information, address, signatures specimen and (major and additional) income sources of those who act on behalf of a customer or as his agent. DTFCs must establish procedures and policies in order to achieve the objectives relating to updating of the General Account.
141. For accounts opened under official approvals or letters, such as government accounts updating period must not exceed max. 5 years.
142. In case, there is any suspicion of money laundering or terrorist financing in any time relating to account holder or authorized persons, DTFCs must update the General Account with such information