Know Your Customers (KYC)
Know Your Customer or Know Your Client is the process by which a business verifies the identity of its customers and clients. Due diligence and enhanced due diligence are Know Your Customer or KYC processes. The processes are in place to prevent identity theft, financial fraud, terrorist financing and money laundering – which businesses can fall foul of if they do not properly employ KYC procedures.
Money laundering regulations
Businesses also operate KYC procedures to ensure compliance with the law, particularly because the money laundering regulations are extremely harsh and stringent. In a lot of cases, you do not need to know what is going on to be guilty. If you end up handling or distributing criminal money because you haven’t done the proper checks, it’s possible to be convicted of a money laundering offence. Ignorance is not enough.
What are KYC processes?
Typical KYC checks include:
- the collection and analysis of your customer’s identity information
- checking your customer’s name against lists of known parties, e.g. a ‘politically exposed person’
- determination and monitoring of risks based on the customer’s previous and expected behaviour, and
- constant monitoring of the transaction with that customer.
Private investigators can help with KYC checks and due diligence, before and during your transactions with a customer. They can give you peace of mind that you know exactly who you are dealing with and that all of the money exchanging hands is clean. The private investigators at Global Investigations have years of experience doing identity investigations, background checks, due diligence and KYC checks relying on a huge multitude of sources. We do it firstly to make sure our clients are compliant with the money laundering regulations, and secondly because a client has expressed a particular concern about a potential customer.
So if you have concerns about your KYC compliance, you want to improve your compliance and reduce the risk in your dealings, or you are particularly suspicious about a new customer, give us a call.