How to Verify Your Customers Online - an introduction

Mitchell
MitchellJune 6, 2019

Share:

A simple self serve solution to your KYC/AML/CTF obligations

bronID online verification portal

Before we get started on verifying your customers and building upon Part B of a compliant AML/CTF program I suggest you read the AML Act, do your own research… thoroughly… and be sure to take notes, complying with this legislation is of the utmost importance to any successful business in the financial sector… see below…

Learn more about the Australian AML/CTF Act

Learn more about the International Governance

TLDR?

We have put together an easy to use, step by step starting point for an identity solution which will enable you to go above and beyond the requirements for KYC/AML/CTF compliance with both minimal efforts and for a reasonable cost.

bronID Self-Serve Verification Portal

  • Verify your user for KYC/AML/CTF electronically and instantaneously using two government-issued identity documents within a couple of minutes
  • Zero integration fees
  • Pay as you go solution
  • No lock-in contracts
  • Batch Verifications

Interoperability with the bronID app

  • Refer your customer to bronID so re-verification and AML risk compliance can become automated
  • Help create and request access to a dynamic risk profile for your customer
  • Respect the privacy of each individual’s PII (Personally Identifiable Information) and ensure its security by using the Bron API
  • Allow your users to create a persistent and portable verified identity they can share with a variety of financial services.

Why should I do AML/CTF compliance this way?

Identity verification systems are rarely the primary function of a business and yet they make up one of the more crucial steps to onboarding new customers in the digital economy.

Today we can automate much of the initial and ongoing AML compliance using an open identity protocol, APIs and an app.

The current system continues to place most of the responsibility for AML compliance on the business independently. This is inherently problematic, as it is difficult to maintain a high standard across such an array of financial products and services. Complexity among the AML requirements can also lead to knowledge gaps with regards to building a program deserving of the industry best practices. Causing businesses to either be satisfied with the bare minimum levels of compliance or even willing to accept a level of risk where their systems are inadequate.

Surely there can be better and more progressive outcomes when taking a risk-based approach to regulation.

As seen recently, the CBA AML/CTF Case in Australia shows that neglecting to use best compliance practices could have you run the risk of significant repercussions. Take the Royal Commission into the Australian banks over the past year as an example. We can see that even large and trusted organisations such as banks can forgo AML best practices if their priorities are not aligned with compliance and reporting.

An open identity verification standard and system which specialises in compliance offers a unique opportunity to improve the way business complies with these regulations. If such a system allows the individual to federate and maintain a persistent digital identity there is great potential for future ubiquity.

In such a system, businesses are able to collaborate and strengthening an individual’s digital identity. This builds a more comprehensive picture of a customer, making it far easier to attribute an accurate risk profile required for an effective AML/CTF program.

There has been a major shift in the way organisations perceive and treat the ownership of an individual’s data, representing a crucial step to such a system proliferating. With the changes in legislation such as Consumer Data Right and Open Banking to be introduced in the next year, we are beginning to see this move in the right direction, however, it is only the first step to a healthier system for identity governance, one which prioritises the individual and protects from fraud.

What does this mean for cryptocurrency?

“The Federal Government’s move to regulate digital currency exchange providers aims to close a major regulatory gap with respect to businesses involved in providing digital currency exchange services, ultimately reducing the money laundering and terrorism financing risks attached to this particular sector.”

Murray Deakin and Sara Liu in a PWC report on the updates to AML/CTF legislation for digital currency exchanges.

By design, digital currency is built for peer to peer transactions. Regulating exchanges is a good start as they are typically the initial access point for digital currency users, however, it doesn’t cover all bases. Achieving a holistic approach to compliance for digital currencies, therefore, requires an additional layer of verification for the individual to carry with them. A verified identity layer.

An open digital identity protocol and application offers a simple and elegant solution to AML compliance for digital currencies.

It empowers the individual to attain, store and share their persistent and verified identity. Reducing the cost of verification and re-verification, while at the same time building a more complete and dynamic risk profile, one federated by a variety of trusted actors.

Here is how AUSTRAC Introduces AML/CTF Obligations

The AML/CTF Act implements a risk-based approach to regulation. As listed by AUSTRAC, businesses must meet the minimum obligations set out in the AML/CTF Act and AML/CTF Rules, prioritising;

  • Enrolment: All regulated businesses need to enrol with AUSTRAC and provide prescribed enrolment details
  • Establishing and maintaining an AML/CTF program: To help identify, mitigate and manage the money laundering and terrorism financing risks a business faces
  • Customer Due Diligence: Identifying and verifying the customer’s identity, and ongoing monitoring of transactions
  • Reporting: Notifying authorities of suspicious matters, threshold transactions and international funds transfer instructions
  • Record keeping: Businesses are required to keep records of transactions, customer identification, electronic funds transfer instructions and details of AML/CTF programs.

Complete all of those steps and you are off to a good start to covering your AML/CTF obligations.

Complying with your AML obligations can be a complex process, and yet a crucial piece for proving a legitimate service.

bronID is constantly adding to our AML/CTF toolkit to help you execute on your each of your compliance obligations.

By signing up to the bronID Portal and following our knowledge centre guides we aim to help you automated your AML/CTF compliance obligations and make achieving industry best practices the bronID standard.

Follow us on Medium, Twitter, Facebook, and LinkedIn.

AML/CTFbronID PortalKYC/KYBCompliance SeriesOnline Verification

Share:

Mitchell
Written by

Mitchell

A catalyst for transforming legislation and governance into easy to use software. The personified pen of bronID.

Subscribe

Stay in the know

Keep up to date with the latest developments and regulatory changes.

Wave footer