The advance of technology has extended far into almost every aspect of work and home life but its use in terms of due diligence is currently limited, despite the fact that the benefits could be significant. However, things look all set to change for 2016. The JFSC is currently in a consultation process looking at proposals to provide additional guidance on electronic CDD and in a progressive move forward, last month saw the GFSC issue new annexes to the Handbooks for Financial Services Businesses and Prescribed Businesses on Countering Financial Crime and Terrorist Financing, which have paved the way for businesses to have greater confidence when using technologies.
According to the GFSC, the changes which have been made to the rules and guidance in the Handbooks provide for, ‘the use of technologies such as digital signatures and electronic verification in the client take-on process and when due diligence documentation has to be updated, including where this technology is delivered through the internet or by tablet and smartphone applications.’
What does this mean for businesses?
Demand from industry for alternative, cost effective and customer friendly options has been growing and now companies can begin to make the most of the development and implementation of a variety of alternative technical options that capture and deliver due diligence components through the internet, tablets or smart phone applications.
This exciting step from the GFSC and consideration from the JFSC means that companies across the Channel Islands could soon all have positive affirmation that implementing new technologies, such as using digital signatures, is not only a valid way of doing business, but they are also expected to be a much bigger and more important element of the due diligence process.
Channel Islands at the forefront
Digital signature solutions have been available for many years and their ability to improve business processes, reduce waste and dramatically reduce costs are well proven. Importantly, the use of a digital signature also validates the authenticity and integrity of an electronic document, which will evidence if that electronic document has been altered in any detail. Traditionally they have been delivered as “on-premise” solutions that have been relatively expensive and difficult to justify for the small to medium sized businesses. More recently online cloud solutions have been provided, but these are based either in the United States or Europe. This introduced the issue of data being stored in those jurisdictions.
Channel Islands company and Jersey Chamber of Commerce member, SignOff, has been leading the way for the Channel Islands in this sector. It has developed the world’s first offshore, cloud-based digital signature service. Launched in both Guernsey and Jersey and in partnership with A O Hall, Legal Specialists and Guernsey Digital Green house, this new technology is working to ensure the Channel Islands keep up with the latest global offerings and legal changes as the use of technology changes the traditional process of industry.