The Complete and Ultimate Guide to Know Your Client (KYC)

This course is a complete, basic to advanced, walkthrough for the KYC process, going from entity types, due diligence types, risk types, name list screening and adverse media, politically exposed persons, adoptions, regular reviews, event triggered reviews, but also a more in depth view of certain business specific KYC requirements for Money Service Businesses, Gambling companies, SPVs, CIS, Correspondent Banking, Underlying Principals and much, much more!

Once you have completed the entire course, you can request your personalized Certificate of Completion issued by The Elite Compliance Group.

I will provide you in 48 hours the .pdf version (which includes the unique QR code) and the personalized URL where your certificate will be published. Other electronic formats are available on request.

This Certificate is provided in addition to the one offered by Udemy.

Below you can find the full course index.

The course also contains small questionnaires for you to check your acquired knowledge for some of the sections.

Full Course Index:

What is Know Your Client?

• KYC Concepts

• What is the KYC End to End Process?

KYC Requirements

• Step 1 - Entity Type

  • Establishing the Status of the Client

    • Parent or Holding Company

    • Subsidiary Company

    • Branch

• Entity Types

  • Natural Person

  • Government and State Owned Entity (SOE)

  • Recognized Regulated Entity or Branch

  • Recognized Listed Entity

  • Private Entity

  • Special Purpose Vehicle

  • Private Investment Vehicle (PIV)

  • Collective Investment Scheme

  • Trust Entity

  • Foundation Entity

  • Charities and Political/Religious Associations

  • Financial Technology, Gambling, Money Service Businesses

• Step 2 Determining Client Risk Rating and Due Diligence Level

  • Risk Types

  • Due Diligence Types

  • Initial Risk Rating

  • Due Diligence Level

  • Per Se and Additional Risk Factors

    • Per Se Risk Factors

    • Additional Risk Factors

• Step 3 Client Due Diligence

  • Identification

  • Verification

  • Plausibility

  • Validation

  • Acceptable Information Sources

    • Audited Annual Report

    • Government Issued Identification Documents

    • External Professional Attestation

    • Use of Third Party Service Providers

    • True Copy Certification (TCC) Requirements

  • RR, EDR and Re-Activation of Client Relationships

  • Language/Translation Requirements

  • KYC Requirements - Identifying and Understanding the Client

    • Gathering Client Information and Determining Legal Form

    • Confirm the Capacity in which the Client Acts

    • Client’s Address

    • Guarantors

    • Legal Entity Identifiers

      • Which products are in scope for LEI?

    • Nature of Business and Purpose of Relationship

      • Understanding the Nature of Business

      • Holding Company

      • Understanding the Purpose of Relationship

      • Business Restrictions and Prohibited Industries

    • Source of Funds

      • Identifying the Source of Funds

        • Normal Business Activity

        • Activities other than Normal Business

      • Verifying the Source of Funds

      • Assessing the Source of Funds

    • Client Senior Managers

      • Identifying and Verifying Client Senior Managers

      • Non-natural Person Client Senior Managers

      • Client Senior Managers with “Significant Control”

        • Definition of “Significant Control”

        • Indicators of “Significant control”

        • Example: How to form an assessment of a CSM with significant control

      • Client Senior Managers Identified as Politically Exposed Persons

      • Risk Indicators

    • Other Relevant Parties

      • Persons Acting on Behalf of the Client

        • Broker relationships

        • Market Infrastructure and other service providers

        • Research services

        • Collateral Arrangements

        • Securities Services

    • Ownership and Ultimate Beneficial Owners

      • Beneficial Ownership Drilldown Requirements

        • Beneficial Ownership Drilldown for Special Entity Type Client or IBO

        • Share Types (excluding Bearer Shares)

        • Bearer Shares

        • Ownership Structure during a Merger and Acquisition

      • Creating an Ownership Chart

      • Application of Accumulation and Domination Calculation Methodologies

        • Accumulation Methodology

        • Domination Methodology

    • Source of Wealth

      • Identifying the Source of Wealth

      • Verifying the Source of Wealth

      • Assessing the Source of Wealth

    • Name List Screening

      • Entities and/or Individuals to Screen

        • Reviewing and Discounting Hits - Validating Hits

        • Materiality of Hits

    • Politically Exposed Persons

      • Identification of a PEP

        • Identification of a RCA

        • CSM PEPs in Governments and State Owned Entities (SOEs)

      • PEP Requirements

      • Assessment of a PEP’s Role

      • Reclassification as a non-PEP

Adoptions, Extensions and Reviews

• New Client Adoption

  • Abandonments

• Cross Jurisdictional and Multi-Jurisdictional Adoption

  • Cross Jurisdictional and Divisional Adoption

  • Multi-Jurisdictional Adoption

• New Product Extension

• Regular Review

• Event Driven Review

• Client Exit Protocol

Business Specific KYC Procedures

• Money Services Business and FinTech (Financial Technology)

  • Definition of a MSB

  • Definition of a FinTech

  • The FinTech/MSB Review Panel

• Gambling

  • Definition

  • KYC Requirements

• Special Purpose Vehicles

  • Definition

  • KYC Requirements

• SPV Relevant Party Key Considerations

• Common Orphan SPVs types

  • KYC requirements for Orphan SPV

• Documentation Requirements

• Correspondent Relationships

• Syndicated Lending and Secondary Loan Trading

• Guarantors

  • Definition

  • KYC Requirements

• Correspondent Banking

  • Definition

  • KYC Requirements

• Agent and Underlying Principal Relationships

  • Definition

  • General Due Diligence Requirements for UPs (CIS and Mandates)

    • Investment Manager Due Diligence Requirements

    • Investment Manager Regulated Status

    • Investment Advisor Due Diligence Requirement

    • Sub-Investment Advisors / Managers KYC Requirement

  • CIS Summary Due Diligence Requirements

    • Parties to a CIS Relationship

    • Recognized Regulated / SEC Registered IM

    • Non Recognized Regulated / Non-SEC Registered IM / Due Diligence Local Product specific Requirements

    • Due Diligence Requirements when CIS is acting as Principal

      • Broadly Distributed Option

      • Reliance Letter Option

      • Email Confirmation Option

      • Where there are no UBO’s identified

  • Mandate Summary Due Diligence Requirements

    • Recognized Regulated / SEC Registered IM and UP is a Mandate

    • Non Recognized Regulated / Non-SEC Registered IM

Final notes

• Waivers

• Red Flags

Glossary

Instructors

Ramona Spinu – Responsable de operaciones y compliance - sector financiero