The client authentication is carried out according to the policy on the prevention of money laundering on the basis of the law of the 4th European Union anti-money laundering Directive (AMLD IL) on June 5, 2015 with the observance of the rules of combating money laundering in the UK
The KYC rule for assessing potential risks
One of the ‘soft’ international benchmarking is the rule KYC – Know Your Client, an established translation of which into Russian language is formulated as ‘Know your customer!’. In accordance with the practice of this principle it would be better to translate into Russian as ‘the Rules for selection of customers.’ Its essence boils down to the need to provide a potential customer of the financial organization of documents containing regulated information about his identity.
What documentation identificeret personality in the system of the KYC
A set of standardized documents for legal entities and individuals and its composition is determined by the nature of the procedure. For example, to open a Bank account you will need along with the filled application form submit:
- a notarized copy of important (with photo and signature) pages of the passport;
- roof of residency (it can be a certified translation of the passport of a resident with a photo, signature and place of residence or, for example, a certified copy of the accounts for the provided utilities);
- recommendation from a Bank where the applicant already has an account, or a letter of recommendation or a lawyer or a chartered accountant the accompanying activities (it should describe the status of the relationship).
How does KYC
The system performs several functions. On the one hand, KYC financial structure gives an opportunity to protect their interests:
- it certifies the identity of the client;
- allows security to determine the degree of risk of customer involvement in illegal activities (a priori it is considered that such a risk is subject to each individual client);
- allows you to manage your own risk to install the filter, regulating the type and number of transactions for a specific customer;
- allows you to monitor unusual client transactions and, if necessary, to initiate their investigation.
On the other hand, in most cases, KYC plays into the hands and to the client. They provided truthful information will help the Bank employee to give him such an account that will meet real needs – whether they support the business or asset protection. Broker of a stock exchange, knowing the financial situation of his client and the specificity of its activity, will give him the most suitable investment advice, and financial Advisor will select the best solution for asset management.
Thus, the policy customer identification KYC is a kind of protective mechanism and for clients and accompanying them to activities of business entities. It clearly structures the admissibility of relevant financial transactions and protects both parties from possible penalties