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Key Considerations for Implementing KYC Software for Your Business

Key Considerations for Implementing KYC Software for Your Business

by | Sep 26, 2023 | Blog, KYC, News & Events, Uncategorized

Key Considerations for Implementing KYC Software for Your Business

With businesses facing the ongoing challenge of operating in a digital landscape that welcomes an increasing amount of users (source) each year, the need for robust Know Your Customer (KYC) processes has become integral for security and crime prevention. The Financial Industry Regulatory Authority (FINRA) has identified cybercrime as one of the greatest global risk factors for criminal activity in 2023 (source), and businesses can expect evolving mandates to expand the current regulatory demands faced by banks, financial, legal, and other related institutions.

Knowing how to choose the right KYC software for your specific needs is integral when it comes to streamlining your operations as well as staying compliant with all jurisdictional requirements. Below, we’ll take a closer look at some of the key factors to consider when viewing and implementing prospective KYC software, as well as the benefits of partnering with iComply. Read on to learn more!

Compliance is Essential

Know Your Customer protocols are more than just a box that needs to be checked to avoid fines (though this is certainly integral to their implementation). KYC processes and legislation are required to combat threats posed by a wide variety of criminal activities, including money laundering (AML), counter-terrorist funding (CTF), fraudulent activity, and the use of money for illicit means, including the drug and human trafficking trades. While KYC mandates may present inconveniences to businesses in terms of the need for altered and more secure operations, they are designed to prevent the very real, harsh realities faced by victims of crime all across the globe.

In order to make sure you find the best fit for your industry, as well as your jurisdiction, you must ensure that you are aware of all existing requirements and that your chosen solution performs as necessary to remain compliant in the fight against financial crime.

Did you know? iComply’s KYC solutions seamlessly integrate mandates from 250 jurisdictions and counting!

User Experience

In addition to being fully compliant with all relevant measures, your chosen KYC software should be easy to use for any individuals and/or departments involved. Your KYC platform should provide a user-friendly interface for both customers and your internal teams and guide them through every step of the verification process with clear instructions and a streamlined approach. Once data is submitted, it is essential that the software is able to accurately analyze and report core data points and provide comprehensive reporting and analytics features for your team to review as needed.


Security and Data Protection

KYC protocols call for the safe and efficient handling of sensitive customer information, including personal and financial data. Data security, therefore, must be a top priority when selecting a KYC software provider. Look for solutions that employ robust encryption protocols, secure storage systems, and regular security audits. As with the first point, you must ensure that your software is compliant with all relevant privacy mandates, and adheres to all related regulations.

Flexibility and Customization

Every business has distinct needs when it comes to fulfilling KYC protocols. Your chosen software should be flexible and allow you to customize it as needed for your specific industry. iComply’s modular suite of solutions, for example, makes it easy to stay compliant and integrate all necessary details but also gives you the opportunity to enhance your current practices with the full power of all elements being configured to your exact needs.

Why Partner with iComply?

iComplyKYC takes pride in revolutionizing the field of compliance with the help of our industry-leading KYC and due diligence solutions. Our comprehensive platform leverages edge computing, empowering users to process their sensitive data directly on their own devices, eliminating the risks associated with storing data in the cloud or relying on unverified third-party vendors. iComply’s modular suite of programs keeps you compliant with regulations from almost 250 jurisdictions worldwide, enabling your company to significantly reduce overhead costs by up to 80% in KYC operations.

Whether you’re seeking to streamline your hiring process, evaluate your existing customer database, or establish a strong operational foundation for the future, iComplyKYC provides an unrivalled level of safety and security. Our intelligent and customizable platform can be effortlessly set up within minutes and takes a streamlined approach to make it as easy as possible to screen for risks like AML, conduct Enhanced Due Diligence and implement ongoing monitoring, all within a single platform.

Book a demo with our team today to learn more about iComplyKYC and how our platform can be used for your specific needs and applications.

learn more

Is your AML compliance too expensive, time-consuming, or ineffective?

iComply enables financial services providers to reduce costs, risk, and complexity and improve staff capacity, effectiveness, and customer experience.

Request a demo today.

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Ensuring KYC Compliance: Best Practices for the Legal Industry

Ensuring KYC Compliance: Best Practices for the Legal Industry

by | Sep 20, 2023 | Blog, KYC, News & Events

Ensuring KYC Compliance: Best Practices for the Legal Industry

When we think of Know Your Customer (KYC) and AML protocols, most people tend to associate the terms (and practice) with businesses involved in the financial sector, and for good reason. Banks, digital vendors, and other forms of financial institutions are beholden to strict international regulations in order to protect against money laundering (AML), counter-terrorist financing (CTF), fraud, and other illicit activities. While financial institutions may be one of the most visible industries that utilize KYC protocols, multiple other sectors handle sensitive information that leaves clients and the public vulnerable to attack without the proper measures in place.

The legal industry is a sector that demands confidentiality and security, with due diligence (CDD and EDD) becoming essential to the protection of all involved parties. Legal enterprises face unique challenges where KYC is concerned, and with major firms running the risk of interacting with sanctioned individuals, politically exposed persons (PEPs), and other risk-prone customer profiles, knowing who you’re partnering with is crucial to preventing criminal activity within in, or through the use of, your organization.

Below, we’ll take a closer look at some of the specific details businesses in the legal industry need to stay on top of to maintain KYC best practices, mitigate risk, and maintain the integrity of their operations.

Understanding Due Diligence

Due diligence (also known as CDD or EDD) refers to processes and checks in place that help businesses and institutionsconfirm the identity of and accurately assess the related risk associated with a specific individual or organization. For law firms, in particular, due diligence is vital when it comes to identifying potential conflicts of interest, reputational risks, financial viability, problematic associations (or sanctions), unethical practices, and more.

How KYC Aids in CDD For Law Firms

KYC is a critical aspect of due diligence for law firms. KYC incorporates multiple processes/procedures designed to verify the identity and assess the suitability of clients before initiating a business relationship. KYC regulations vary across jurisdictions, but it is a near-universal standard that adequate procedures must involve collecting and verifying core information like identity documents, proof of address (business and/or personal), and funding sources. Steps involved in conducting KYC generally entail the following:

Identification and Verification

The first step to accomplish the above goals is to obtain accurate identification information from clients. This entails collecting documents like full legal name(s), DOB, nationality, passport or valid government identification cards, and other related documents that comply with relevant jurisdiction-based regulations. Once information is collected, law firms may request additional information as needed to conduct Enhanced Due Diligence (EDD) and then will conduct verification to ensure all data is authentic and reliable in order to empower a trustworthy relationship moving forward.

Source of Funding

Law firms must be able to identify the source of their client’s funds to help prevent money laundering or other financial crimes. This also helps to protect against dangerous associations and ensures non-problematic transactions going forward. Clients may be asked to provide bank statements, tax returns, or other relevant financial documents. Law firms must also assess their clients’ overall wealth and financial background, including investments, activities, and transaction volume.

Risk Assessment

Once an entity or individual’s identity and funding have been verified, law firms (and other enterprises subject to KYC mandates) conduct a risk assessment to evaluate any potential hazards to conducting business with a specific client or the risk inherent with a specific transaction. Such assessments consider a wide variety of factors, including the client’s industry, geographical location, business reputation, political exposure, and any previous legal issues.

Clients that are determined to be high risk may require more extensive investigations (via EDD or other measures) and ongoing monitoring to ensure compliance with anti-money laundering (AML) and counter-terrorism financing (CTF) regulations.

Ongoing Monitoring

Law firms, just like any other business, must be aware that KYC is an ongoing obligation to maintain efficacy. Criminal activity is rarely a “one-time” risk, and thus those utilizing verification and risk assessment protocols must commit to the routine monitoring of clients to identify any suspicious activities or changes in the client’s circumstances. Monitoring includes reviewing client information, transaction patterns, and conducting periodic reviews of client relationships. In case of any red flags or anomalies, law firms are responsible for reporting them to the relevant authorities.

Discover the iComply Advantage Today

Knowing that you have access to trusted, automated verification and security protocols is essential for legal firms and other industries governed by KYC mandates. iComply’s suite of innovative, modular-based KYC programs is designed to simplify compliance and adapt seamlessly to evolving legislation, meaning you can easily stay on top of conducting due diligence. Our software leverages cutting-edge AI and blockchain technology to ensure complete regulatory compliance across 245 jurisdictions worldwide and allows you to effortlessly construct fully automated workflows tailored to unique client types, jurisdictional requirements, and more, all with minimal disruption.

Empower your organization with a comprehensive 360º view of KYC data and set your legal firm up for success with iComply’s digital identity verification solutions today!

Ready to take the next step?

Contact us today to explore iComply’s comprehensive, modular compliance solutions or to book a demo with one of our experienced product specialists.

learn more

Is your AML compliance too expensive, time-consuming, or ineffective?

iComply enables financial services providers to reduce costs, risk, and complexity and improve staff capacity, effectiveness, and customer experience.

Request a demo today.

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Simplifying KYC Compliance with iComplyKYC

Simplifying KYC Compliance with iComplyKYC

by | Sep 20, 2023 | Blog, KYC, News & Events

Simplifying KYC Compliance with iComplyKYC

Today’s business and commerce markets are moving faster than ever, and with a rapidly evolving landscape, knowing that you have the best protocols and tools in place to stay compliant with Know Your Customer (KYC) and Anti-Money Laundering (AML) standards is essential. 2022 saw nearly $5 billion levied against businesses globally for counter fraud infractions, and with cyber security remaining a chief concern amongst global regulatory boards, staying on top of KYC is no longer a nicety, it is an absolute necessity.

In order to create a streamlined approach that meets the demands of all jurisdictional mandates, utilizing a proven KYC software like the suite of multi-faceted solutions offered by iComplyKYC is one of the best ways to stay on track and ensure you have everything you need to stay compliant and efficient.

Below, we’ll take a closer look at the importance of KYC procedures, as well as the benefits of partnering with a vetted industry leader like iComply. Read on to learn more.

Why KYC Matters

As we enter to a cultural and socio-economic shift that sees more consumers and businesses moving their operations online and into the digital world, the risk of criminal activity in increasingly decentralized markets is higher than ever before. Identity theft, fraudulent claims and misappropriation of funds are on the rise, and due diligence legislation has become vital to circumvent criminal activity. In addition to hindering multiple illegal ventures, KYC also allows your business to establish trusted customer identities, and accurate risk profiles, and avoid accidental association with those who may have ties to illicit activity like money laundering, human trafficking, terrorist funding, and more.

The iComply Approach

iComply believes in establishing trust in every transaction and removing the barriers that often keep companies from creating streamlined anti-fraud systems. Our unique modular suite of KYC software makes it easy to integrate our platform into your existing system, and leverages advanced technologies such as edge computing, machine learning, and refined algorithms to provide a seamless end-to-end experience. Backed by industry partners like Microsoft and Deloitte, iComplyKYC offers users the following:

Real-Time Monitoring and Risk Identification

As recent world events have reminded us, customer profiles and associated risks can change rapidly in the face of evolving conflicts and previously undiscovered associates. Being able to consistently evaluate and seamlessly reassess the known risk of your user base is essential to preventing criminal activity, and failure to identify new, problematic details, can spell disaster for businesses.

iComplyKYC gives you access to real-time monitoring of over 150 million data sources, including sanctions lists, watchlists, regulatory bodies, and adverse media. This comprehensive coverage enables businesses to stay up-to-date with potential risks and promptly identify any suspicious activities.

Natural Language Processing

iComplyKYC employs sophisticated Natural Language Processing (NLP) powered by artificial intelligence for efficiency. NLP enhances identity verification by finessing and assessing core human traits (as well as identifying human users) through the understanding of speech patterns, named entity recognition, spam/bot detection, and more.

The integration of NLP into iComplyKYC allows our platform to quickly identify, aggregate, and adjudicate potential risk results, significantly enhancing the speed and accuracy of compliance processes while also reducing the risk of human error.

Customizable Compliance Workflows

Every jurisdiction has its unique regulatory requirements, and global regulatory boards often implement new mandates to correspond with the rising risks of specific criminal activity. iComplyKYC is designed to be adaptable and easily integrated with over 250 jurisdictions worldwide. Our team knows that the ability to pivot and restructure in real-time, alongside evolving laws, is key to avoiding fines and contributing to the effective elimination of financial crime globally.

iComply’s KYC software also offers fully integrated data visualization, empowering businesses with actionable insights and information precisely when they need it. This feature allows compliance teams to make informed decisions quickly and efficiently.

Creating a Better Path Forward

At iComply, we know KYC and AML protocols are one of the most important parts of creating a strong preventive foundation against fraud and other forms of finCrime. We know that staying on top of constantly evolving legislation can be tricky, but we believe that the key to reducing opportunities for crime lays in creating trusted and secure digital ecosystems that empower businesses to act with confidence (and compliance) through every stage of their interactions with clients and other institutions. Learn more about how we can help empower your KYC practices by contacting our team today.

learn more

Is your AML compliance too expensive, time-consuming, or ineffective?

iComply enables financial services providers to reduce costs, risk, and complexity and improve staff capacity, effectiveness, and customer experience.

Request a demo today.

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iComply Announces Security Token Patent and Prefacto Licensing Program

iComply Announces Security Token Patent and Prefacto Licensing Program

by | Sep 14, 2023 | Prefacto, Blog, In The News, News & Events

US Patent grants iComply exclusive rights to a pivotal security feature for tokenized assets and announces Prefacto™ licensing program

VANCOUVER, B.C. – September 14, 2023 – iComply, a global compliance technology provider, is pleased to announce a new licensing program for US patent US-20220103378-A1 System and Method for Off-chain Cryptographic Transaction Verification, an essential technology that ensures transactional compliance for financial institutions using blockchain.

Filed on July 18, 2018, this patent was the first to cover the key technology behind the industry’s issuance and trading of regulatory compliant security tokens, central bank digital currencies (CBDCs), non-fungible tokens (NFTs), and stablecoins.

Since 2018, the security token market has seen explosive growth, boasting a current value of over US $17B.  Leading consulting firm Security Token Advisors CEO Herwig Konings believes “that capital markets will move towards a natively-blockchain based asset and securities life cycle and use tokenized assets to reinvent the customer experience and back office administration.” Experts from premier global financial institutions project that by 2030, US $30T worth of tokenized assets will be in circulation, a staggering CAGR of 410%. 

“The scale at which the industry has already adopted Prefacto™ IP is exciting,” states iComply CEO Matthew Unger. “We are not only enhancing the standards of digital finance concerning security and liquidity but also streamlining blockchain transactions across diverse providers.”

Bridging Traditional Compliance with Blockchain Innovation

Today, consumers benefit from seemingly instantaneous authorization of credit card payments at millions of merchants globally. However, unseen complex processes behind each transaction often take several days to settle, particularly where existing traditional systems require a funds transfer between the customer’s bank and the merchant’s bank.

Prefacto™ leverages foundational blockchain technologies including whitelisting and transaction validators to enable instant settlement of transactions globally. Spearheading the program Peter Nieforth, SVP Licensing, states, “Prefacto™ dramatically reduces the operational costs of ensuring compliance, trust, and integrity in global financial transactions.”

The Future of Financial Transactions

iComply was founded with a vision to power trustworthy transactions for billions of people. The latest Prefacto™ patents and newly launched licensing program are key milestones in the company’s journey, creating the foundation for financial institutions, tokenization platforms, and trading facilities worldwide to join them on this mission.

About iComply:

iComply Investor Services Inc. has been pioneering compliance technology since 2017 and is headquartered in Vancouver, Canada. Using artificial intelligence, blockchain, and edge computing, iComply’s Prefacto™ and iComplyKYC™ solutions are set to redefine the sector, enabling organizations to harness opportunities offered by digital transformation—without compromising compliance, privacy, or scalability. Learn more: www.icomplyis.com 

iComply Outlines Vision of a Trusted Digital Ecosystem in Newly Released White Paper

iComply Outlines Vision of a Trusted Digital Ecosystem in Newly Released White Paper

by | May 31, 2023 | News & Events

iComply Outlines Vision of a Trusted Digital Ecosystem in Newly Released White Paper

VANCOUVER, Canada, May 29, 2023 – iComply, a global leader in compliance technology, has released its white paper titled “The Importance of Digital Identity in the Modern World.” This comprehensive document scrutinizes the challenges and future potential of digital identity, reflecting the company’s mission to establish trust in every transaction.

The existing landscape of digital identity presents numerous obstacles, including fragmented identity management, centralized control as a potential single point of failure, incompatibility across different digital identity systems, and inadequacies in internet infrastructure. Such complexities can result in a disjointed user experience and heightened security risks.

However, the white paper also showcases iComply’s vision of pioneering a trusted and secure digital ecosystem that empowers individuals, businesses, and communities. Matthew Unger, CEO of iComply, explains, “Our vision is not only to navigate the challenges of today’s digital identity landscape but to create a transformative ecosystem that enables trust, ensures privacy, and fosters equity. We envision a future where every transaction is compliant, transparent, and secure.”

The document posits an optimistic future for digital identity, where advanced technology and industry collaboration can overcome current difficulties. It highlights potential improvements in security, privacy, and user convenience, signifying a future where every individual can thrive in a safe and equitable digital world.

“Reimagining digital identity isn’t just about solving current problems. It’s about catalyzing potential. By prioritizing trust, accountability, and privacy, we can build a digital world where everyone can access services, control their identities, and interact securely,” adds Unger.

“The Importance of Digital Identity in the Modern World” offers an insightful roadmap for anyone committed to fostering a secure digital future. The white paper is available for download on the iComply website.

About iComply Investor Services Inc.:

iComply Investor Services Inc., a global leader in compliance technology, is headquartered in Vancouver, Canada. Their vision is to pioneer a trusted and secure digital ecosystem that empowers individuals, businesses, and communities, enabling compliant, transparent, and secure transactions worldwide.

For further information, please contact:

Theodora Birch
[email protected]

Download White paper

Travel Rule Facts: What to Know About FATF’s Recommendation 16

Travel Rule Facts: What to Know About FATF’s Recommendation 16

by | May 3, 2023 | Blog, KYC, News & Events

Travel Rule Facts: What to Know About FATF’s Recommendation 16

Are you aware of the key details pertaining to the Financial Action Task Force (FATF)’s Travel Rule?

As a relative newcomer into the global securities and digital legislation field, the Travel Rule—also referred to as “FATF Recommendation 16”—has garnered significant attention as of late, particularly with 2022 closing the year with several alarming instances of crypto market-related security issues. While the Travel Rule has not been “formalized” into governing legislation, it is referenced as such because it closely resembles U.S. requirements pertaining to documenting both the originator and recipient identities of virtual asset transactions.

Recommendation 16 represents the understanding of both FATF and the global financial legislation community that the exchange of virtual currencies and assets like cryptocurrency opens new avenues for financial crime and corruption. Below, we’ll take a quick look at some of the basics of the Travel Rule, as well as what to anticipate from continued legislative efforts in the future.

What is the “Travel Rule”

The Travel Rule was introduced in 2019 as a way to establish better visibility and more consistent standards for transactions using virtual asset service providers (VASPs). As described above, the Travel Rule recommends that virtual exchanges attach a unique identifier to both the originating and destination wallet in order to verify and assess the known risk attached to involved entities.

By removing the “anonymous” nature of virtual exchanges and implementing a form of traceable accountability, the risk of fraud lowers and it becomes difficult for criminals to conduct illicit activities like money laundering, terrorist financing, and more.

At present, the guidelines suggested by the FATF predominately apply to transactions exceeding $1000 USD/ €1000, with exchanges under this amount only needing the name of the originator/beneficiary as well as the specific VA wallet or transaction code for each. If a transaction exceeds the $1,000 threshold, the following data points are recommended:

  • Originator/Beneficiary name
  • Account number of the Originator and Beneficiary (wallet address)
  • The geographical address of the Originator
  • National identity number (SSN or SIN) for all involved parties
  • The Customer ID number for the ordering institution
  • DOB and place of birth

While the Travel Rule is often discussed when pertaining to VASPs, it is also applicable to financial institutions when a transaction involves virtually masked parties (e.g. a wire transfer that ‘legitimizes’ the assumed value of cryptocurrency during cashout).

From Recommendation to Legislation

As mentioned earlier, the Travel Rule we know today remains more of an international recommendation rather than a globally upheld financial regulation. With that being said, the European Parliament is currently in the process of implementing a new bill designed to close known gaps in the current EU regulatory environment.

The Markets in Crypto-Assets (MiCA) is expected to be voted on in early 2023, with possible adoption in 2024, and aims to establish harmonized rules for crypto-assets handled within the European Union.

Under the current framework of MiCA, crypto-assets are defined as any “digital representation of a value or a right which may be transferred and stored electronically, using distributed ledger technology or similar technology” and regulated into 3 different categories:

  • Asset-Referenced Tokens (ARTs)
  • Electronic Money Tokens (EMTs)
  • Other

Under current guidelines, MiCA does not apply to security tokens, NFTs, or E-Money Directives.

Both the Travel Rule and MiCA play a vital role in the continued regulation and safekeeping of virtual asset exchanges. Digital and cyber-based crime is anticipated to become one of the most prevalent forms of fraud in the next few years (source); with this in mind, a continued commitment to compliance and security is essential for all institutions and entities that interact within the global marketplace.

Protection with Ease through iComply

At iComply, we know that staying on top of constantly evolving AML and KYC protocols can be challenging, especially with the rapid pace virtual assets continue to expand. We are proud to offer a one-of-a-kind end-to-end suite of KYC + KYB software that makes it simple to stay informed and compliant with the latest AML legislation, taking a strict stance against the harms caused by all forms of fincrime.

Our KYC software, iComplyKYC can be integrated into your existing framework within minutes and easily configured to match the regulatory guidelines of nearly 250 international jurisdictions, giving you safety and peace of mind when it matters most.

Learn how you can stay ahead of evolving AML and fraud standards, and discover why iComply is your leading choice for software solutions by talking to our team today!

DISCOVER ICOMPLYKYC

learn more

Is your AML compliance too expensive, time-consuming, or ineffective?

iComply enables financial services providers to reduce costs, risk, and complexity and improve staff capacity, effectiveness, and customer experience.

Request a demo today.

Exploring the Changing Landscape of Digital ID Verification
Exploring the Changing Landscape of Digital ID Verification

Nov 21, 2023

Robust identity verification has become an absolute necessity when combating the rapidly evolving nature of cybercrime. As technology continues to progress, mass usership and a rise in decentralized banking and other forms of cloud based services have brought...

Navigating FINRA Compliance: 5 Key Pillars for Financial Professionals
Navigating FINRA Compliance: 5 Key Pillars for Financial Professionals

Nov 6, 2023

With the financial sector moving faster than ever and encountering more unique circumstances due to decentralized competition at the helm, regulatory oversight has become paramount to safeguarding the integrity of the financial markets and protecting investors. The...