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What is KYC?

Know your customer (abbreviated as KYC) is a term of banking and exchange regulation for financial institutions and bookmakers, as well as other companies that work with private money, meaning that they must identify and establish the identity of the counterparty before conducting financial transaction. This requirement extends to obtaining reasonably complete information about counterparties-legal entities, the nature of their business and individual business transactions, to ensure which a financial transaction is carried out.This practice is believed to discourage money laundering, terrorist financing and tax evasion. Currently, the requirements and standards aimed at the implementation of this principle are established at the level of national legislation, regulatory documents of banking regulators and international organizations. Consistent implementation of the “know your customer” principle has led to a gradual ban on the maintenance of anonymous bank accounts.

KYC — is part of AML (Anti-Money laundering) — Combating money laundering from illegal activities. AML consists in monitoring customer accounts in order to detect suspicious cash movements. It is used in banks, exchanges, poker rooms, etc.

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26.09.2022, 00:48