What two words can strike fear in the hearts of chief compliance officers and their staff? Compliance audit. However, when compliance teams prepare ahead and put the right systems in place, there’s no need for a sense of dread.
In Canada, entities that must report their compliance with anti-money laundering (AML), know your customer (KYC), and counter-terrorist financing (CTF) regulations are:
- Notaries (British Columbia only)
- Dealer in precious metals and stones
- Financial entities
- Life insurance
- Money services businesses
- Real estate
- Securities dealers
Other jurisdictions have similar requirements. PwC provides a helpful guide with information on the AML and KYC regulations for countries around the world.
Let’s begin with what regulators look for in a compliance audit. FINTRAC, Canada’s financial intelligence unit, has provided recommendations for reviewing your business’s compliance regime every two years. The goal of the review is to test the effectiveness of a company’s AML and KYC systems in terms of policies and procedures, risk assessment and control, and training of staff.
One of the key areas that must be examined in a company’s compliance review is its record keeping procedures for records that must be kept. When carrying out customer due diligence (CDD), the ability to give evidence of identity verification (IDV) transaction records is essential.
GlobalGateway, Trulioo’s instant online IDV portal and Normalized API, offers a powerful and versatile feature that companies can easily use during an audit in order to show proof of regulatory compliance. The feature is called “Transaction Review” and here is an example of how it works:
When a GlobalGateway portal user selects the Transaction Review tab, as shown above, they can search for an IDV transaction based on a number of different criteria: transaction record ID, first and last name, account, user, country, and date range. There is also the ability to look for watchlist searches as well as searches that did not match any data source.
You can search for all countries or for only a specific country. In this example, the user is searching for Australia IDV transactions performed by all users.
A date range can be set to limit the search to a specific time period. Now that the criteria have been set, the user clicks on the Search button.
In the Transactions search results, you can see that only the transactions from the given date range are returned.
You can search on a specific first and last name within a specific date range. Transaction Review returns only the records specified. Let’s take a closer look at a specific record that’s been highlighted above.
When looking at the transaction record detail, you can find out precisely which fields matched on which data source. This can be very helpful for showing proper KYC compliance and also for refining or customizing match rule sets.
Transaction Review can help your business to ensure that it’s ready for an enhanced compliance audit. Check out our online resources to find out more about how GlobalGateway can streamline your AML/KYC process or contact our sales team to book a live product demonstration.