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Customer knowledge or KYC

MODULE CONTENTS

This module explores the importance of KYC (Know Your Customer), a key procedure in the fight against money laundering and the financing of terrorism (LCB-FT). It explains how companies, particularly in the financial and banking sectors, need to verify the identity of their customers in order to detect suspicious transactions. The module covers the different aspects of the KYC procedure, from on-boarding to remediation, and highlights the importance of innovation and automation in these processes, while respecting data protection regulations.

LEARNING OBJECTIVES

  • Understand the fundamental role of KYC in the fight against money laundering and terrorist financing
  • Learn how to identify risks linked to customers and their transactions through verification checks
  • Understand the different stages of KYC, from on-boarding to ongoing remediation.
  • Recognize the importance of automation in KYC processes to increase efficiency
  • Familiarize yourself with companies' legal KYC obligations and the consequences of non-compliance

Know Your Customer (KYC): A pillar in the fight against money laundering

KYC, or "Know Your Customer", is an essential procedure in the fight against money laundering and the financing of terrorism (LCB-FT). It enables companies, and financial institutions in particular, to verify the identity of their customers in order to detect atypical or suspicious transactions. KYC applies to both individuals and legal entities, with in-depth checks to ensure the identity of the beneficial owners behind a company.

KYC comprises several stages, starting with on-boarding, when a customer first enters into a relationship, where supporting documents are requested to validate identity. This process continues throughout the business relationship, with regular remediation to ensure that information is always up to date. The aim is to prevent any business relationship with individuals or entities linked to terrorism, corruption or money laundering.

KYC procedures can be carried out online or physically, and automation plays a crucial role in improving customer experience and business efficiency. By automating certain checks, companies can detect suspicious behavior more quickly and stop illegitimate transactions. However, it is essential that these processes comply with data protection regulations.

Failure to comply with KYC obligations can have serious consequences, such as fines or damage to a company's reputation. KYC procedures are therefore essential for guaranteeing the security of financial transactions and helping to protect citizens' rights and freedoms.