# iDenfy > --- ## Pages - [Identity Verification for Web Hosting and NIS2 Compliance](https://www.idenfy.com/nis2-compliance-web-hosting/): Learn about NIS2 compliance changes impacting web hosting providers and domain registrars starting in 2025. - [KYC Mobile SDK for Effortless Identity Verification](https://www.idenfy.com/kyc-mobile-sdk/): Integrate the KYC mobile SDK for your native applications, including support for Flutter, ReactNative, and other platforms. - [Email confirmation](https://www.idenfy.com/email-confirmation-kyb/): - [Create your kyb account](https://www.idenfy.com/create-your-kyb-account/): - [About us](https://www.idenfy.com/about-us/): iDenfy is a technology company that make the world better place to live: fraud prevention, identity verification, anti money laundering solutions. - [Identity Verification for Securing, Promoting & Monetizing Music](https://www.idenfy.com/identity-verification-for-music/): Verify musicians, ensure fraud-free subscriptions, convert more global artists and ensure secure music streaming using identity verification. - [Sole Proprietorship Verification Service](https://www.idenfy.com/sole-proprietorship-verification/): Learn about Sole Proprietorship Verification Service offered as part of KYB workflow to streamline business onboarding. - [Instant AI Company Data Crossmatch](https://www.idenfy.com/instant-ai-company-data-check/): Learn about iDenfy's AI powered company data crossmatch functionality used to find discrepancies, or correlations during business verification. - [Adverse Media Screening Service](https://www.idenfy.com/adverse-media-screening-service/): Learn about iDenfy's Adverse Media Screening Service as part of the full AML compliance software. - [Sanctions Screening Software](https://www.idenfy.com/sanctions-screening-software/): Learn about iDenfy's AML Sanctions Screening Software to continuously monitor your customers against worldwide watchlist and PEPs list. - [e-IDV Verification Service](https://www.idenfy.com/e-idv-verification-service/): Instantly verify customers with e-IDV verification service to match customers data across USA databases within 30 seconds. - [Pricing & Plans](https://www.idenfy.com/pricing-plans/): iDenfy pricing page with all KYC, AML and KYB features and according packages per different verification volumes. - [Bank Verification Service](https://www.idenfy.com/bank-verification-service/): Learn about Bank Account Verification services and how iDenfy's solution offers instant onboarding and an access to customer's spending history. - [Identity Verification for the Trading Industry](https://www.idenfy.com/identity-verification-for-trading/): Learn about how identity verification, AML services are used across trading industry in forex exchanges, instant trading, etc. - [Age Verification Software](https://www.idenfy.com/age-verification-software/): Learn about how to choose the best age verification service provider, by comparing age extraction methods, liveness verification. - [Identity Verification in Gambling](https://www.idenfy.com/identity-verification-for-gambling/): Learn about identity verification in gambling industry, how to choose the best KYC provider for iGaming companies. - [Why choose iDenfy vs. Onfido?](https://www.idenfy.com/idenfy-vs-onfido/): Learn about differences between iDenfy and Onfido, the KYC and AML vendors. Compare the identity verification pricing and software features. - [Why choose iDenfy vs. Trulioo?](https://www.idenfy.com/idenfy-vs-trulioo/): Learn about differences between iDenfy and Trulioo, the KYC and AML vendors. Compare the identity verification pricing and software features. - [Why choose iDenfy vs. Persona?](https://www.idenfy.com/idenfy-vs-persona/): Learn about differences between iDenfy and Persona, the KYC and AML vendors. Compare the identity verification pricing and software features. - [Why choose iDenfy vs. Veriff?](https://www.idenfy.com/idenfy-vs-veriff/): Learn about differences between iDenfy and Veriff, the KYC and AML vendors. Compare the identity verification pricing and software features. - [Perpetual KYB Solution](https://www.idenfy.com/pkyb-service/): Learn about Perpetual KYB (pKYB) services and how iDenfy's business verification solution meets compliance requirements. - [Know Your Patient (KYP) Verification](https://www.idenfy.com/know-your-patient-kyp-verification/): Learn about Know Your Patient (KYP) Verification services and how iDenfy's identity verification helps with age verification. - [One-Click UBO Verification Service](https://www.idenfy.com/ubo-verification-service/): UBO verification service to identify key shareholders, required for the Know Your Business verification. Know Your Business verification. - [Identity Verification for E-Commerce Platforms & Marketplaces](https://www.idenfy.com/identity-verification-e-commerce/): Learn about identity verification, AML verification solutions, required to build secure e-commerce marketplace. - [Utility Bill Verification Service with AI-Powered Precision](https://www.idenfy.com/utility-bill-verification-service/): Utility Bill Verification Service compares the provided data with extracted information for all non-latin languages. - [Careers v2](https://www.idenfy.com/careers-v2/): - [Bubble KYC Integration](https://www.idenfy.com/bubble-kyc-plugin/): Integrate the Bubble KYC plugin and start onboarding customers instantly without additional code. - [Advanced Customer Risk Assessment Service](https://www.idenfy.com/customer-risk-assessment-service/): Integrate customer risk assessment service for businesses. Set custom rules and use your workflow with Know Your Business onboarding. - [AML Screening & Ongoing Monitoring Software](https://www.idenfy.com/aml-screening/): AML Screening & Ongoing Monitoring service. Check manually or Get Notified Instantly via API. Company AML Screening Software included. - [Face Authentication service](https://www.idenfy.com/face-authentication-service/): Integrate Face Authentication to re-verify your existing customers after completing successful KYC verification. Takes 15 seconds on average. - [Careers](https://www.idenfy.com/careers/): We fight against money laundering, terrorism financing, and other fraudulent activities using the latest technologies. Join our team. - [Know Your Business Solution designed for compliance teams](https://www.idenfy.com/know-your-business-solution/): Try the Know Your Business solution with integrated custom forms creation, shareholders and UBOs extraction, and ongoing AML screening. - [Homepage v3](https://www.idenfy.com/): Identity verification service for user onboarding. Mitigate fraud with instant ID verification. Meet Know Your Customer, AML regulations. - [Try for free](https://www.idenfy.com/try-for-free/): - [Pricing](https://www.idenfy.com/pricing/): - [Talk to sales](https://www.idenfy.com/talk-to-sales/): - [Enhance your WooCommerce site with identity verification](https://www.idenfy.com/identity-verification-woocommerce/): Integrate identity verification for WooCommerce site within 5 minutes. - [Why choose iDenfy vs. Sumsub?](https://www.idenfy.com/idenfy-vs-sumsub/): Learn about differences between iDenfy and Sumsub, the KYC and AML vendors. Compare the identity verification pricing and software features. - [Consumer Agreement](https://www.idenfy.com/agreement/): Service Agreement Terms of services Definitions Scope of services Scope of data processing Representations and obligations Limitation of liability Financial... - [Customers](https://www.idenfy.com/customers/): Learn about iDenfy's identity verification solution, trusted by more than 500 customers worldwide. - [Email confirmation](https://www.idenfy.com/email-confirmation-aml/): - [My account](https://www.idenfy.com/my-account/): - [Checkout](https://www.idenfy.com/checkout/): - [Cart](https://www.idenfy.com/cart/): - [Revolutionize identity verification in the transport industry](https://www.idenfy.com/revolutionize-identity-verification-in-the-transport-industry/): Learn about identity verification in the transportation industry. We offer AML compliance, KYB, face authentication to complete fraud prevention. - [Customizable KYC for every streaming platform](https://www.idenfy.com/customizable-kyc-for-every-streaming-platform/): Learn about KYC and how it prevents online fraud for streaming services, by detecting deep fakes, face masks or fraudulent documents. - [Free ID Verification Service](https://www.idenfy.com/free-identity-verification-service/): Free identity verification service to maximize conversion and minimize fraud. Use free ID verification for quick users onboarding. - [Identity Verification for Gaming](https://www.idenfy.com/identity-verification-for-gaming/): ID verification for the Gaming. Learn how to use identity verification for age verification and prevent fraud effectively for your gamers. - [Identity Verification for Crypto, Blockchain & NFT Compliance](https://www.idenfy.com/identity-verification-crypto/): Whether you’re launching a crypto exchange, DeFi project, or token, iDenfy makes identity verification a breeze so you stay compliant. - [Report Abuse](https://www.idenfy.com/report-abuse/): At iDenfy, we take security very seriously and enforce measures to detect and prevent spam, phishing, illegal copyright, and trademark usage. - [Verify any proof of address document with ease](https://www.idenfy.com/proof-of-address-verification/): Perform address verification and confirm proof of address documents in seconds. Say goodbye to time-consuming customer onboarding. - [Identity Verification for Proxy Networks](https://www.idenfy.com/identity-verification-for-proxy-networks/): Protect your proxy networks from fraudulent activity and chargeback threats with identity verification. Don't Miss Out! - [Cyber Insurance](https://www.idenfy.com/cyber-insurance/): Insurance for all identity verification, fraud prevention, and anti-money laundering solutions iDenfy consistently takes many safeguards toward safety when it... - [Email confirmation](https://www.idenfy.com/email-confirmation/): - [ID verification in Your WordPress site](https://www.idenfy.com/id-verification-wordpress/): ID Verification in Your WordPress Site. Install Our Official App and Prevent Internet Fraud Starting Today! - [Freemium vs. Preemium](https://www.idenfy.com/freemium-vs-preemium/): Features Freemium Premium Supported documents 200 documents 2500+ documents Data storage time Maximum 30 days Up to 12 years MRZ... - [The Complete Identity Verification Solution](https://www.idenfy.com/identity-verification-service/): Identity verification services, automated and enforced with manual oversight. Verify the customer's identity quickly and securely. - [Business verification services with everything you need in one API](https://www.idenfy.com/business-verification-services/): All in one business verification services. Business verification using 180 global business registries and major credit bureaus. - [Download report: Fighting Fintech Fraud with Identity Verification](https://www.idenfy.com/fighting-online-fintech-fraud/): Download the report on how to fight online fraud in Fintech. Learn how to use ID verification and other fraud prevention systems in Fintech. - [Download report: Fighting Fintech Fraud with Identity Verification](https://www.idenfy.com/fighting-online-fintech-fraud/): Download the report on how to fight online fraud in Fintech. Learn how to use ID verification and other fraud prevention systems in Fintech. - [Identity Verification for Fintech Industry](https://www.idenfy.com/identity-verification-for-fintech/): ID verification for the Fintech industry. Learn how to use identity verification and prevent fraud effectively for Fintech company. - [Download report: Fighting Online Gaming Fraud with Identity Verification](https://www.idenfy.com/download-report-fighting-fintech-fraud-and-crime-with-identity-verification/): hbspt. forms. create({ region: "na1", portalId: "6082545", formId: "f231f2fd-3df3-474c-983c-30d0ef881992" }); - [Deep Phone Number Check & Validation](https://www.idenfy.com/phone-verification/): Phone verification and validation. Detect fraud patterns with phone verification by scanning multiple data points of the phone number. - [Filter customer’s IP with Proxy Detection Service](https://www.idenfy.com/proxy-detection-ip-insight/): Proxy detection Service. Real-time anonymous IP detection and scoring. Prevent fraud in its tracks with seamless intervention. - [NFC chip-based identity verification](https://www.idenfy.com/nfc-verification/): Near Field Communication (NFC) technology use for identity verification. Scan ePassports to to confirm authenticity and integrity with NFC. - [Assess Your Customer’s Risk Score](https://www.idenfy.com/fraud-scoring/): Fraud scoring system to detect and prevent fraudulent transactions. Customer evaluation solution to ensure legitimate transactions. - [Supported AML databases](https://www.idenfy.com/supported-aml-databases/): Supported Supported AML databases laundering databases. Politically Exposed Persons and Sanctions List, Watch List, Most Wanted List. - [Security and Compliance](https://www.idenfy.com/security/): Security and compliance are essential to our mission to ensure our clients' sensitive data are protected. ISO 27001 certified. GDPR compliant. - [AML Compliance](https://www.idenfy.com/aml-compliance/): AML Compliance : Achieve anti-money laundering AML compliance for online customer identity verification. Meet KYC, AML & GDPR regulations. - [Supported Documents](https://www.idenfy.com/supported-documents/): Thousands documents accepted for identity verification from over 200 countries and territories. Passport, driving licence, identity card. - [Book a Free Demo](https://www.idenfy.com/book-a-meeting/): Get a personalized free demo on how iDenfy can benefit you with identity verification and fraud prevention service. - [Book a Free Demo](https://www.idenfy.com/book-a-meeting/): Get a personalized free demo on how iDenfy can benefit you with identity verification and fraud prevention service. - [WHAT IS KYC?](https://www.idenfy.com/know-your-customer/): What is Know Your Customer? KYC refers to a process verifying the identity of your customers. How to meet KYC compliance in digital enviroment? - [Developers](https://www.idenfy.com/developers/): API and SDK integration documentation, tutorials. Integrate identity verification and fraud prevention service from iDenfy. - [](https://www.idenfy.com/get-started/): Create account and start using identity verification service, prevent fraud, comply with know your customer rules. - [Identity Verification for Sharing Economy](https://www.idenfy.com/sharing-economy/): Identity verification in the sharing economy industry. Prevent fraud, ensure customers' safety, build credibility. - [Identity Verification in Online Gaming](https://www.idenfy.com/online-gaming/): Identity verification for Online Casino, Gambling sites. Prevent fraud and ensure safety with automated identity verification. - [Identity Verification for Electronic Money Institutions](https://www.idenfy.com/electronic-money-institution/): Know your customer (KYC) & Anti-money laundering (AML) compliance is one of the essential requirements for your EMI license. - [Identity Verification for Digital Wallets](https://www.idenfy.com/digital-wallets/): Identity verification for electronic wallets, digital payments. Verify customers' identities, prevent fraud, ensure safety. - [Contactaţi-ne](https://www.idenfy.com/contactati-ne/): Contactați serviciul de verificare a identității iDenfy folosind e-mail, telefon sau poștă. - [](https://www.idenfy.com/contact-us/): Contact iDenfy's technical support, customer support or sales department. Send us a message here and we'll get back to you. - [Pricing](https://www.idenfy.com/identity-verification-price/): Price for online identity verification, ID check, anti-money laundering, and know your customer service. Verify identity online. - [Cookie policy](https://www.idenfy.com/cookie-policy/): This site uses cookies, which are tiny files that are downloaded to your computer, to improve your user experience in our website. - [Privacy policy](https://www.idenfy.com/privacy-policy/): Data protection is our top priority. Learn more how we process and manage data such as the name, address, e-mail address, or telephone number - [Newsroom](https://www.idenfy.com/press-media/): All the latest news and coverage from iDenfy. Read press releases, latest awards and achievements, download the media kit. - [Partner program](https://www.idenfy.com/partner-program/): Partner and affiliate program in identity verification and fraud prevention sector. Earn more and build safer tomorrow. - [Blog](https://www.idenfy.com/resources/): Identity verification, Know Your Customer, Anti Money Laundering and fraud prevention stories, tutorials, and discussions. --- ## Posts - [The Guide to KYB Onboarding ](https://www.idenfy.com/blog/the-guide-to-kyb-onboarding/): Learn about the KYB onboarding: what it is, why it matters, best practices, and other features for compliance and fraud prevention. - [Fraud Detection Using AI in Banking](https://www.idenfy.com/blog/fraud-detection-using-ai-in-banking/): Fraud detection - banks' need it. Check out the blog post about how fraud detection using AI could be used in banking. - [AML Case Management [Detailed Guide]](https://www.idenfy.com/blog/aml-case-management/): Look through the key steps of AML case management and learn how to simplify AML tasks for AML compliance analysts using automation. - [How to Prepare Business Formation Documents](https://www.idenfy.com/blog/business-formation-documents/): Learn the key types of business formation documents, and how to start your business operations legally in the US while complying with KYB. - [A Guide for Compliance Officers - Top Interview Questions in 2025 ](https://www.idenfy.com/blog/a-guide-for-compliance-officers/): Prepare for your compliance officer interview with expert tips, various interesting questions, and real-world advice to stand out. - [What is a Magic Link and How Does it Work?](https://www.idenfy.com/blog/what-is-a-magic-link/): Explore the topic of the Magic Link: how it's related to application security, authentication and identity verification in KYC compliance. - [Top 5 Compliance Automation Tools in 2025 ](https://www.idenfy.com/blog/top-compliance-automation-tools/): Learn about the top 5 compliance automation tools of 2025, which are leading today's market and keep most of the businesses compliant. - [Best Identity Verification Software Providers of 2025](https://www.idenfy.com/blog/best-identity-verification-software/): Best Identity Verification Software Providers of 2025. Features and reviews of 5 Best Identity Verification Companies. - [KYC Requirements in the UK for 2025 [Updated]](https://www.idenfy.com/blog/kyc-uk/): KYC is a legal requirement in the UK. And with Brexit, EU's AMLDs, and industry-specifics, it becomes challenging to stay compliant. - [The Cost of Fraud](https://www.idenfy.com/blog/the-cost-of-fraud/): Do not wait for fraud attacks to hit the company - instead, use the various anti-fraud methods specified in this blog post. - [Case Study: TOPsport ](https://www.idenfy.com/use-cases/topsport-idenfy-study/): Learn how the leading iGaming platform, TOPsport, switched to a fully automated player onboarding process and AML screening for compliance. - [What is KYC](https://www.idenfy.com/blog/what-is-kyc/): Want to keep your business or company safe from fraud? Or are you just curious about KYC in general? Look no further, we've got you covered. - [Case Study: Liquid Noble](https://www.idenfy.com/use-cases/liquid-noble-idenfy-study/): Learn about tokenization in the precious metal industry and how AI-powered ID verification and AML screening solutions by iDenfy helped Liquid Noble. - [Best KYB (Know Your Business) Software Providers of 2025](https://www.idenfy.com/blog/best-kyb-software/): Best KYB (Know Your Business) Software Providers of 2025. Features and reviews of 5 Best Know Your Business Companies. - [How to Find Out Who Owns a Business [Guide]](https://www.idenfy.com/blog/find-out-who-owns-a-business/): Learn the key databases where you can lookup the company's ownership structure, finding out who owns a business online. - [Top 10 AML Software for Banks ](https://www.idenfy.com/blog/top-aml-software-for-banks/): The newest blog post about the top 10 AML software for banks will help you choose the best software for your bank. - [5 Online Casino Scams You Need to Know in 2025](https://www.idenfy.com/blog/online-casino-scams/): Find out what kind of schemes fraudsters use to cheat iGaming platforms and learn how they actually succeed with such online casino scams. - [Best KYC Software Providers of 2025](https://www.idenfy.com/blog/best-kyc-providers/): Best KYC Software Providers of 2025. Features and reviews of the 5 Best KYC Verification Companies. - [Best AML Software Providers of 2025](https://www.idenfy.com/blog/best-aml-software-providers/): Best AML Software Providers of 2025. Features and reviews of 5 PEPs, Sanctions, and Adverse media screening companies. - [How to Choose The Best KYC SaaS Platform for 2025](https://www.idenfy.com/blog/best-kyc-saas-platform/): Wondering how to choose the best KYC SaaS Platform for 2025? Idenfy got you covered. Learn what features represent the best platforms. - [Case Study: Proxyrack](https://www.idenfy.com/use-cases/proxyrack-idenfy-study/): Learn how Proxyrack optimized its KYC flow by integrating iDenfy's end-to-end ID verification software for improved conversion rates. - [Know Your Business (KYB) Service: Ultimate Compliance Guide](https://www.idenfy.com/blog/know-your-business-kyb/): Know Your Business (KYB) is the process of verifying the identification information provided by a company. And it's more complex than KYC. - [How to Check if a Company is Legitimate](https://www.idenfy.com/blog/check-if-a-company-is-legitimate/): Thinking of making a big purchase or signing an important business deal? It's okay to feel anxious. Learn how to check if a company is legitimate. - [Machine Readable Zone](https://www.idenfy.com/blog/machine-readable-zone/): Machine Readable Zone (MRZ) is a particular area in an ID document (passport, id card) that encloses the document holder's personal data. - [Machine Readable Zone](https://www.idenfy.com/blog/machine-readable-zone/): Machine Readable Zone (MRZ) is a particular area in an ID document (passport, id card) that encloses the document holder's personal data. - [KYC Verification [3 Main Components & More]](https://www.idenfy.com/blog/kyc-verification/): Learn all about KYC verification from the RegTech expert's perspective, focusing on the key KYC/AML components in different sectors. - [Best 8 Fraud Prevention Solutions in 2025](https://www.idenfy.com/blog/best-fraud-prevention-solutions/): Learn about how to be safe and choose the best fraud prevention solution that would fit your company in 2025. - [Case Study: Rebell Pay](https://www.idenfy.com/use-cases/rebell-pay-idenfy-study/): Find out how Rebell Pay integrated iDenfy's KYC and AML software to lower compliance costs by 15%, all thanks to automation and custom flows. - [Biggest Money Laundering Cases](https://www.idenfy.com/blog/biggest-money-laundering-cases/): Money laundering remains a significant issue today, and there have been even larger cases in the past. Check them out. - [EIN Verification in KYB Compliance [Dos & Don'ts]](https://www.idenfy.com/blog/ein-verification-in-kyb/): Find out how you can check EIN numbers online, what databases are appropriate, and how this is all tied to KYB verification. - [AI in Fraud Prevention](https://www.idenfy.com/blog/ai-in-fraud-prevention/): Learn how AI is helping with fraud prevention in businesses and companies all around the world and fighting cyber criminals. - [NIS2 KYC guide for Domain Name Service Providers](https://www.idenfy.com/blog/nis2-kyc-domain-servers/): Learn about the NIS2 directive and how to effectively utilize KYC and identity verification for domain name service providers. - [What is Social Security Number (SSN) Verification?](https://www.idenfy.com/blog/ssn-verification/): Explore the most common ways to perform SSN verification, and learn how this process can be used for a compliant KYC check. - [SOC 2 vs. ISO 27001: 6 Key Differences](https://www.idenfy.com/blog/soc-vs-iso/): Many companies don't know which to use when choosing between SOC 2 and ISO 27001. Learn about six key differences that will help you decide. - [How to Prevent Wire Transfer Fraud? [Top 5 Scams]](https://www.idenfy.com/blog/wire-transfer-fraud/): Access the latest insights on wire transfer fraud, including common scamming techniques, learning how to not get caught in such schemes. - [MLRO Work Responsibilities in 2025](https://www.idenfy.com/blog/mlro-work-responsibilities-in-2025/): As fraudulent activities are higher than ever, companies must somehow prevent them. This is where MLRO comes in - find out more about them. - [KYC Remediation](https://www.idenfy.com/blog/kyc-remediation/): Find out what KYC Remediation means, why it is important for your business, and how it helps you stay safe, compliant, and organized. - [eIDV: Electronic Identity Verification (Definition, Examples & More)](https://www.idenfy.com/blog/eidv-electronic-identity-verification/): Learn all about eIDV, or electronic identity verification, and how it combines multiple layers of verification, including database checks. - [Tax Avoidance vs Tax Evasion: Legality Aspects & Detection Measures](https://www.idenfy.com/blog/tax-avoidance-vs-tax-evasion/): Learn the legality aspects and key differences between tax avoidance and tax evasion, and find out if it's possible to detect both processes. - [KYC in Traditional Finance (TradFi)](https://www.idenfy.com/blog/kyc-in-traditional-finance/): KYC in TradFi - learn everything about its benefits, cons, its impact on operational security and legal compliance. - [How Fraudsters Continue to Succeed with Multi-Accounting in 2025](https://www.idenfy.com/blog/multi-accounting/): Learn why some cases of multi-accounting are more serious than others while reviewing solutions that can help identify this illicit practice. - [Cryptocurrency Regulations Around the World](https://www.idenfy.com/blog/cryptocurrency-regulations-around-the-world/): Cryptocurrency regulations are being implemented all around the world, iDenfy explains about these policies from various frameworks to taxes. - [Refund Fraud: Definition, Key Types & Ways to Stop It](https://www.idenfy.com/blog/refund-fraud/): Find out how criminals defraud major online stores and marketplaces by abusing return policies and mastering different refund fraud methods. - [KYC in the Metaverse: Trust in a Virtual World](https://www.idenfy.com/blog/kyc-in-metaverse/): Metaverse - exciting digital world but it is nothing without KYC, iDenfy explains everything you need to know about KYC in Metaverse. - [Beneficial Ownership Information (BOI) Reporting [Guide]](https://www.idenfy.com/blog/beneficial-ownership-information/): Access the main details about Beneficial Ownership Information (BOI) reporting requirements and FinCEN's stand on this new rule. - [How to Check if a Business is in Good Standing](https://www.idenfy.com/blog/check-if-a-business-is-in-good-standing/): Learn what compliance requirements are needed to maintain in good standing and how to check if other businesses have this certificate. - [Understanding KYC and MiCA](https://www.idenfy.com/blog/understanding-kyc-and-mica/): Learn about EU adopted regulatory framework of Markets in Crypto-Assets Regulation - MiCA. iDenfy explains full KYC compliance guide. - [Responsible Gaming: Does this Concept Actually Work?](https://www.idenfy.com/blog/responsible-gaming/): Responsible gaming measures seem pretty straightforward, but in practice, gambling platforms still struggle with certain measures. Learn why. - [KYC Risk Assessment: Automation Rules & Key Risk Factors to Consider](https://www.idenfy.com/blog/kyc-risk-assessment/): KYC risk rating or KYC risk assessment is one of the first steps in the company's AML risk assessment and due diligence processes. Learn why. - [The 6th Anti-Money Laundering Directive (6AMLD) [Simple Explanation]](https://www.idenfy.com/blog/anti-money-laundering-directive-6amld/): Access this ready-made guide on the 6th Anti-Money Laundering Directive (6AMLD), featuring FAQs and key AML compliance process examples. - [Proof of Income: Top 10 Document Types [& Verification Tips]](https://www.idenfy.com/blog/proof-of-income/): Learn the key types of proof of income documents and find out use cases with explanations o why you should provide data about your finances. - [Sole proprietorship vs LLC: Key Differences & KYB Nuances](https://www.idenfy.com/blog/sole-proprietorship-vs-llc/): Access the key information about the sole proprietorship structure and the difference between LLC, with a focus on KYB compliance. - [AML Compliance for Credit Unions: Top 3 Requirements](https://www.idenfy.com/blog/aml-compliance-credit-unions/): Discover what issues credit unions face when implementing AML compliance procedures and what steps are required to manage risks effectively. - [Case Study: FriendFinder Networks](https://www.idenfy.com/use-cases/friendfinder-networks-idenfy-study/): Find out how the major US-based social media and adult dating empire, FriendFinder Networks, integrated iDenfy's KYC/KYB and AML software. - [Bank Account Verification [Guide]](https://www.idenfy.com/blog/bank-account-verification-guide/): Explore the top ways on how companies can validate a user's financial background through a simple bank account verification flow. - [3 Stages of Money Laundering Explained](https://www.idenfy.com/blog/3-stages-of-money-laundering/): Luxury yachts, fancy cars, real estate empires or shell companies are only a few ways that criminals use in the 3 stages of money laundering. - [Case Study: Coinzilla](https://www.idenfy.com/use-cases/coinzilla-idenfy-study/): Explore how the crypto advertising platform, Coinzilla, chose a RegTech vendor for an automated KYC/KYB compliance workflow. - [The Main KYB Risk Factors You Should Know ](https://www.idenfy.com/blog/kyb-risk-factors/): Is KYB causing you headaches? We compiled a short list of the main risk factors (signals) that you should include to stay compliant. - [How to Spot a Fake ID in Different States? [With Examples]](https://www.idenfy.com/blog/spot-a-fake-id-in-different-states/): Learn the key security features that a legitimate ID document must have across different states from the KYC industry experts' view. - [Keywords in Adverse Media: Search & Screening Challenges](https://www.idenfy.com/blog/keywords-in-adverse-media/): What is the issue with adverse media? There isn't one. Except you need to know what keywords in this process you should use. Find out more. - [Merchant Onboarding: Steps, Required Documents & More](https://www.idenfy.com/blog/merchant-onboarding/): Learn how PSPs and banks deal with merchants, what documentation is needed for KYC/KYB, and how to ensure a swift merchant onboarding. - [What is an AML Risk Assessment? [With Examples]](https://www.idenfy.com/blog/aml-risk-assessment/): Find out the key examples and practical tips on how to perform an AML risk assessment while using AML compliance solutions. - [What is a Transaction Dispute? [Challenges for Merchants]](https://www.idenfy.com/blog/transaction-dispute/): Learn about why a cardholder might open a transaction dispute, what this process means for merchants and PSPs, and how to minimize disputes. - [Best Age Verification Software Providers of 2025](https://www.idenfy.com/blog/best-age-verification-software-providers-of-2024/): Best Age Verification Software Providers of 2024. Features and reviews of 5 Best Age Verification Solutions. - [What is a Sanctions List?](https://www.idenfy.com/blog/sanctions-list/): Find out what a sanctions list is, what regulatory bodies are responsible for sanctions compliance, and how to screen AML databases. - [Can You Combat Bonus Abuse in iGaming?](https://www.idenfy.com/blog/bonus-abuse/): Bots or proxies might be nothing new in a fraudster's agenda, but the iGaming industry has shown that bonus abuse still remains an issue. - [How to Spot a Fake Utility Bill?](https://www.idenfy.com/blog/fake-utility-bill/): Find out the main tactics fraudsters use to forge a utility bill, why it's a common practice in lending, and how to identify a fake document. - [What are Deepfakes? Good vs Bad Use Case Examples](https://www.idenfy.com/blog/what-are-deepfakes/): Get the latest scoop on the world's most famous deepfakes, their positive and notorious examples, and why ID verification is important here. - [What is Loan Fraud? Types and Prevention Tips [Business Guide]](https://www.idenfy.com/blog/loan-fraud/): Get updated with the latest loan fraud types and learn how to identify red flags pointing to potential fraudulent activities. - [Top 5 Identity Verification Measures [For Beginners]](https://www.idenfy.com/blog/identity-verification-measures/): Find out the most popular identity verification measures in the market today and look into the reasons why companies implement them. - [Age Verification in Online Dating: Why You Should Take it Seriously](https://www.idenfy.com/blog/age-verification-online-dating/): Find out if age verification is mandatory in online dating and dive into some notoriously dangerous details that dating apps try to hide. - [2024 Crypto Theft Statistics: The Imperative Role of KYC and AML in Preventing Digital Asset Fraud](https://www.idenfy.com/blog/crypto-theft-statistics/): Learn about recent crypto theft statistics and how KYC with AML software helps to combat potential exploits. - [Ensuring Compliance: The Role of KYC/AML in the Tokenization of Real-World Assets (RWAs)](https://www.idenfy.com/blog/rwa-tokenization-kyc/): Learn about Real-World Assets (RWAs) and how to build effective compliance process to combat money laundering in crypto. - [Global KYB Compliance: Top 3 Challenges and Solutions [With Examples]](https://www.idenfy.com/blog/global-kyb-compliance/): Learn about the key challenges companies face regarding global KYB compliance when scaling into new markets and check out how to avoid them. - [How to Securely Implement Data Migration For Your Business](https://www.idenfy.com/blog/data-migration-guide/): Data migration is a risky business, but you can protect your information with the right strategy. Learn how to securely implement data migration with our guide. - [AML Fraud: Types and Detection Measures](https://www.idenfy.com/blog/aml-fraud/): Find out how AI and digital assets have changed the AML fraud landscape while accessing the key tips on crime detection and AML automation. - [Domestic PEPs and Foreign PEPs — What You Need to Know](https://www.idenfy.com/blog/domestic-peps-and-foreign-peps/): Access AML insights on the different types of PEPs and learn about due diligence procedures for identifying domestic or foreign PEPs. - [How Does Student Identity Verification Work?](https://www.idenfy.com/blog/student-identity-verification/): Find out what kind of scams are the most common in the education sector and explore the benefits of automated student identity verification. - [How to Combat Document Forgery?](https://www.idenfy.com/blog/document-forgery/): Find out the tops ways fraudsters fake documents, and why automated document verification might be the best solution to stop forgery. - [Age Verification Law in Texas [2025 updated]](https://www.idenfy.com/blog/age-verification-law-texas/): Learn how to implement age verification procedure to comply with the Texas age verification law, passed on the 28th of April 2024. - [Customer Risk Assessment: How to Do it Right [Step-By-Step Guide]](https://www.idenfy.com/blog/customer-risk-assessment/): Explore the mandatory steps to determine the level of risk posed by a customer in this step-by-step guide for AML customer risk assessment. - [How Does AML Apply to Crypto? [With Examples]](https://www.idenfy.com/blog/aml-crypto/): Find the key AML rules specifically targeted at crypto exchanges and VASPs, which are now required to comply with the Travel Rule. and more. - [How Does Driver’s License Verification Work?](https://www.idenfy.com/blog/drivers-license-verification/): An in-depth explanation driver's license verification guide, providing concrete examples and the key perks of such document checks. - [Money Laundering in Forex Trading [AML Risk Guide]](https://www.idenfy.com/blog/forex-trading-aml/): Currencies are traded online in the biggest Forex trading market in the world, but with that, an even bigger issue arises — money laundering. - [Source of Funds (SOF) and Source of Wealth (SOW) Checks [Guide]](https://www.idenfy.com/blog/source-of-funds-sof-and-source-of-wealth-sow/): Compare Source of Funds (SOF) with the Source of Wealth (SOW) check and access the key steps for a proper AML and KYC compliance program. - [6 Steps to Conduct a KYB Verification Check [Guided Explanation]](https://www.idenfy.com/blog/kyb-verification-check/): Get an accurate overview of the KYB verification process for you to perform efficient checks on your corporate clients using KYB automation. - [Get Ready for Your AML Audit [Best Practice Guide]](https://www.idenfy.com/blog/aml-audit-guide/): Learn what processes should be included in your AML audit strategy and grab some tips for automation solutions to complete your AML program. - [What is the Crypto Travel Rule? An Overview](https://www.idenfy.com/blog/crypto-travel-rule/): Thresholds, numerous FATF recommendations and specific steps VASPs must consider if they want to stay compliant with the Crypto Travel Rule. - [Third-Party Money Laundering Risks Explained](https://www.idenfy.com/blog/third-party-money-laundering/): A deep dive into third-party money laundering risks, and what that means for businesses — from large-scale banks to small startups. - [How Can You Detect Arbitrage in Sports Betting? [Simple Guide]](https://www.idenfy.com/blog/arbitrage-sports-betting/): Explore the antics behind arbitrage in sports betting and learn how arbers try to avoid bookies and earn profit without getting blacklisted. - [eIDAS Regulation: What You Need to Know](https://www.idenfy.com/blog/eidas-regulation/): Learn about the eIDAS Regulation, its requirements, the impact on public and private sectors, as well as the history and meaning behind it. - [The Risks of Shell Companies in Money Laundering](https://www.idenfy.com/blog/shell-companies-money-laundering/): Learn how shell companies manage to launder millions, their key tactics for illegal activities, and what solutions identify such crimes. - [e-KYB Explained — A Comprehensive Business Verification Guide](https://www.idenfy.com/blog/e-kyb-business-verification/): The key steps and business verification solutions explained for you to switch from non-efficient KYB processes to an AI-powered e-KYB flow. - [Transaction Screening vs Transaction Monitoring [AML Guide]](https://www.idenfy.com/blog/transaction-screening-vs-transaction-monitoring/): Find out what steps are required for both an effective transaction screening and transaction monitoring processes in oder to comply with AML. - [An Overview of the Anti-Money Laundering Act of 2020 (AMLA)](https://www.idenfy.com/blog/anti-money-laundering-act-of-2020/): Find out the exact timeline and the key changes that the Anti-Money Laundering Act of 2020 (AMLA) brought to the US AML compliance landscape. - [Case Study: Payset](https://www.idenfy.com/use-cases/payset-idenfy-study/): Learn how Payset switched to a fully automated KYC flow tailored to the fintech sector, achieving 82% reduction in user onboarding time. - [Know Your Employee (KYE) Explained](https://www.idenfy.com/blog/know-your-employee/): Discover what it takes to build a compliant Know Your Employee (KYC) process and overcome issues like employee fraud or money laundering. - [AML for Neobanks: Compliance Challenges and Solutions](https://www.idenfy.com/blog/aml-for-neobanks/): We list some of the most popular neobanks, explain what AML for neobanks means - or differs from the traditional banking sector. - [Anti-Money Laundering (AML) Software: Explanation, Features & More](https://www.idenfy.com/blog/anti-money-laundering-aml-software/): Learn how to identify effective AML software, its main features, how to build custom rules through automation, and more on staying compliant. - [KYB vs KYC — What is the Difference? [Explanation Guide]](https://www.idenfy.com/blog/kyb-vs-kyc-difference/): Find out all details regarding KYB vs KYC and learn how to implement each process to make your business AML-compliant. - [Top 5 KYC Challenges and How You Can Overcome Them [In-Depth Explanation]](https://www.idenfy.com/blog/kyc-challenges/): Find out what KYC challenges business face and how you can solve them in practice through industry examples and ID verification tips. - [Transaction Monitoring Software in Fintech: How to Set it Up?](https://www.idenfy.com/blog/transaction-monitoring-software-in-fintech/): Learn how to set up transaction monitoring in fintech, specifically adapting to AML compliance requirements and industry specifics. - [AML Red Flags — Complete Breakdown](https://www.idenfy.com/blog/aml-red-flags/): Find a complete in-depth summary of the key AML red flags — warning signs of crime — according to the latest FATF recommendations. - [Address Verification Explained](https://www.idenfy.com/blog/address-verification-explained/): Learn what address verification is, its types, PoA documents, the best address verification flow options and challenges business face today. - [What is Ongoing Monitoring? [With Examples]](https://www.idenfy.com/blog/what-is-ongoing-monitoring/): Ongoing monitoring in AML requires multiple steps and RegTech tools - of course, only if you want to build an efficient and accurate process. - [Business Verification Solution in 2024 - Focusing on Automating Compliance Procedures](https://www.idenfy.com/blog/business-verification-solution-in-2024/): Business Verification solution in 2024. Focusing on automating compliance procedures with automations for AML, KYC checks. - [What is Reverification? Explanation Guide [2025 Edition]](https://www.idenfy.com/blog/what-is-reverification/): Reverification is crucial for swift ID document re-checks and selfie reverification with the bonus of minimizing account takeovers. - [Top 3 KYC Automation Benefits for Businesses](https://www.idenfy.com/blog/kyc-automation-benefits/): In the world of large data volumes, fast scaling efforts, compliance regulations and sophisticated fraudsters, KYC automation is the answer. - [What is a Politically Exposed Person (PEP)?](https://www.idenfy.com/blog/politically-exposed-person-pep/): PEP and KYC/AML rules constantly evolve, obliging companies to conduct screening on high-risk groups, including politically exposed persons. - [Chargeback Fraud Prevention: Key Strategies for Businesses](https://www.idenfy.com/blog/chargeback-fraud-prevention/): How bad are chargebacks for businesses and how to actually minimize chargeback fraud costs + more practical chargeback fraud prevention tips. - [KYC in Banking Explained](https://www.idenfy.com/blog/kyc-in-banking/): KYC, or Know Your Customer (KYC) in banking has its challenges, especially when it comes to the right level of due diligence and automation. - [Case Study: Cherry Servers](https://www.idenfy.com/use-cases/cherry-servers-idenfy-study/): Learn how Cherry Servers reduced fraudulent payment attempts when using iDenfy's AI-powered identity verification solution. - [KYC in Social Media: Less Anonymity = More Security?](https://www.idenfy.com/blog/kyc-in-social-media/): In the era where the verified badge matters for the users, we find out if social media platforms would integrate mandatory KYC verification. - [iDenfy Leads the G2 2024 Winter Batch of Identity Verification Solutions](https://www.idenfy.com/blog/g2-winter-2024-idenfy/): G2 Winter 2024 identity verification report, AML compliance market summary, and best identity verification software reviews. - [Ultimate Beneficial Owner (UBO): Verification Guide](https://www.idenfy.com/blog/ultimate-beneficial-owner-verification/): Identifying and mitigating Ultimate Beneficial Owner (UBO) risk requires accurate data verification. Find all FAQs to ensure compliance. - [Video KYC: What Does it Look Like in 2025?](https://www.idenfy.com/blog/video-kyc/): Forget visiting physical bank branches, or perhaps even video calls and lengthy KYC questionnaires. We explain the right Video KYC approach. - [What is Fraud Detection? [2025 Edition]](https://www.idenfy.com/blog/fraud-detection/): As fraud techniques evolve along with the wild use of AI, companies must find a way to balance out fraud detection and good user experience. - [What is Perpetual KYC (pKYC)?](https://www.idenfy.com/blog/what-is-perpetual-kyc/): Perpetual KYC or pKYC is the next big thing both for RegTech providers and companies that want to step up their KYC/AML compliance game. - [40 Recommendations of the FATF — Overview](https://www.idenfy.com/blog/40-recommendations-of-the-fatf/): 40 Recommendations of the FATF are a foundation for global AML/CTF frameworks, which are both crucial and beneficial for many businesses. - [What is Enhanced Due Diligence (EDD)? [With Examples]](https://www.idenfy.com/blog/enhanced-due-diligence/): Enhanced Due Diligence (EDD) is a set of measures for high-risk customers or transactions. Find a detailed explanation of all requirements. - [AML/KYC Guidelines for Fintech Companies](https://www.idenfy.com/blog/aml-kyc-fintech/): There are many automated AML/KYC tools in the market. But they aren't enough for fintech companies to stay compliant. Read the full guide. - [Virtual Asset Service Providers: The FATF Travel Rule Obligations](https://www.idenfy.com/blog/virtual-asset-service-providers/): Who are and who exactly aren't supposed to be virtual asset service providers (VASPs)? We explore AML and FATF's Travel Rule requirements. - [KYC for Forex Trading: Importance and Challenges](https://www.idenfy.com/blog/kyc-forex-trading/): Forex trading has many users who want to stick to its decentralized roots and leave KYC out of it. But the industry has become regulated. - [AML Compliance in Spain ](https://www.idenfy.com/blog/aml-compliance-in-spain/): Explore the key AML compliance requirements in Spain and learn how to avoid fines and reputational damage with automated RegTech tools. - [Age Gating vs Age Verification: Protecting Minors Online](https://www.idenfy.com/blog/age-gating-age-verification/): We know those pop-ups that appear when confirming our age - asking to tick a box. But are age gates secure? Learn all about age verification. - [AML Compliance for the Luxury Goods Market](https://www.idenfy.com/blog/aml-luxury-goods/): The high value and easy transportation factors turn luxury goods into a great channel for money laundering, requiring robust AML compliance. - [AML Automation: Streamlined Compliance 101 for Businesses](https://www.idenfy.com/blog/aml-automation/): What seemed to be a dream a decade ago, is now a reality. Businesses can't live without AML automation. Why? Learn to ensure AML compliance. - [Financial Crime Compliance: Comprehensive Business Practices](https://www.idenfy.com/blog/financial-crime-compliance/): We've all heard of AML, but what about Financial Crime Compliance, or FCC? Read and find detailed, step-by-step insights to stay compliant. - [Case Study: HollaEx](https://www.idenfy.com/use-cases/hollaex-idenfy-study/): Find out how HollaEx managed to increase its sales by 15% after building a fully automated KYC plugin together with iDenfy's team. - [AML/CTF Compliance in Estonia [Guide]](https://www.idenfy.com/blog/aml-compliance-estonia/): See this detailed guide to learn about the latest regulations in Estonia regarding AML compliance. Find bonus solutions to stay in the loop. - [How Can RegTech Improve AML Compliance?](https://www.idenfy.com/blog/regtech-aml-compliance/): Can we imagine today's regulatory landscape without RegTech solutions? Probably not. Dive into the world of AML compliance and technology. - [Smurfing in Money Laundering Explained ](https://www.idenfy.com/blog/smurfing-in-money-laundering/): Learn how criminals use smurfing in money laundering to go undetected. Explore effective KYC and AML tools to combat this issue. - [What are the 3 Steps to KYC?](https://www.idenfy.com/blog/three-steps-to-kyc/): KYC can be a hassle-free complex... Only if you do it right. We explain the 3 steps to KYC and how to achieve compliance with the right tools - [What is the Difference Between KYC and CDD?](https://www.idenfy.com/blog/kyc-and-cdd/): While KYC and CDD both are vital components of a robust AML program, they have distinct features that businesses must know to stay compliant. - [Money Services Business (MSB) — AML Compliance Guide](https://www.idenfy.com/blog/money-services-business-msb-aml/): As a money services business (MSB), you must follow BSA and AML regulations. This guide shows what companies are MSBs and how they can comply - [Examples of Money Laundering and Prevention Methods](https://www.idenfy.com/blog/examples-of-money-laundering/): Cashing out winnings in a casino, obtaining funds from drugs, or structuring money to avoid AML triggers — meet examples of money laundering. - [What are the Key AML Laws in the US? [Business Guide]](https://www.idenfy.com/blog/aml-laws-us-guide/): While the BSA was introduced in the 1970s, a lot has changed in the modern landscape of AML laws in the US, which poses major challenges. - [DEXs and KYC: Addressing Compliance Challenges](https://www.idenfy.com/blog/dexs-and-kyc/): Decentralized exchanges (DEXs) have been in the talks for quite a while now due to the anonimity and no-KYC policy. But it's about to change. - [What is an NFC Tag? A 2025 Guide](https://www.idenfy.com/blog/what-is-an-nfc-tag/): NFC tag is an ultimate connectivity tool for communication over radio waves. But in the modern world, this tiny thing holds more power. - [What You Should Know About Selfie Identity Verification](https://www.idenfy.com/blog/selfie-identity-verification/): Explore the key factors that make selfie identity verification, a KYC process where users take a selfie, a frictionless, yet safe experience. - [Top 5 Use Cases of Biometrics in Banking](https://www.idenfy.com/blog/biometrics-in-banking/): Facial recognition, fingerprint, iris scans, and more... These biometrics in banking are just the beginning. Explore the top use cases. - [What is the Difference Between CIP and KYC? Examples & FAQs](https://www.idenfy.com/blog/cip-and-kyc/): Both CIP and KYC are vital to prevent your business from fraud and stay compliant. However, there are certain requirements that differ. - [What is Identity Proofing? Complete Security Guide with Examples](https://www.idenfy.com/blog/identity-proofing-guide/): Explore what identity proofing is all about and learn the key ways for a frictionless ID verification process while ensuring KYC compliance. - [What are the Five Pillars of AML Compliance?](https://www.idenfy.com/blog/five-pillars-of-aml-compliance/): Designated compliance officer, training, independent auditing, and CDD are only a part of the five AML compliance pillars. Learn more. - [What is a Customer Identification Program (CIP)?](https://www.idenfy.com/blog/customer-identification-program-cip/): A customer identification program (CIP) requires verifying data provided by your customers. Find the general requirements to stay compliant. - [What are the EU's Anti-Money Laundering Directives (AMLDs)? Complete History Overview](https://www.idenfy.com/blog/eu-anti-money-laundering-directives-amlds/): Explore how EU started the AMLDs era, and how its evolving came to cybercrime or “aiding and abetting” considered as money laundering crimes. - [What is a Risk-Based Approach to AML?](https://www.idenfy.com/blog/risk-based-approach-to-aml/): Learn how a risk-based approach (RBA) can complete an AML compliance program, helping assess business risks and customer risk levels easier. - [New Account Fraud: Alarming Red Flags and Ways to Fight Back](https://www.idenfy.com/blog/new-account-fraud/): New account fraud is a dangerous illegal activity, which can result in severe consequences not only for financial institutions. Learn more. - [Case Study: Neobridge](https://www.idenfy.com/use-cases/neobridge-idenfy-study/): Discover how iDenfy's identity verification, AML screening and PEP/Sanctions checks helped Neobridge save costs on compliance operations. - [How to Improve KYC Verification? Tips For a Frictionless User Experience](https://www.idenfy.com/blog/kyc-verification-tips/): It's one thing to know what KYC verification is, but it's completely another one when it comes to building a frictionless KYC experience. - [What is Watchlist Screening?](https://www.idenfy.com/blog/watchlist-screening/): Learn how to complete an AML compliance program by building a frictionless watchlist screening flow that scans multiple databases with ease. - [Know Your Patient (KYP): How to Prevent Fraud in Healthcare?](https://www.idenfy.com/blog/know-your-patient-kyp/): Know Your Patient (KYP) is a term to describe the Know Your Customer (KYC), or identity verification, process in the healthcare sector. - [What is AML Screening?](https://www.idenfy.com/blog/what-is-aml-screening/): Explore the vital component in every robust AML compliance program, aka AML screening and implement its key practices to stay compliant. - [Case Study: GOAT Finance](https://www.idenfy.com/use-cases/goat-finance-idenfy-study/): Learn how GOAT Finance enhanced its KYC process with iDenfy's automated ID verification, minimizing friction and improving the success rate. - [What is Chargeback Fraud?](https://www.idenfy.com/blog/what-is-chargeback-fraud/): Chargeback fraud, known as friendly fraud, happens more often than you think. Learn how you can avoid such never-ending dispute claims. - [KYC in Online Gaming (iGaming Guide 2025)](https://www.idenfy.com/blog/kyc-in-online-gaming/): KYC in online gaming involves ID verification, source of funds verification, and address verification. Get the latest industry insights. - [How Does Age Verification in the Adult Industry Actually Work?](https://www.idenfy.com/blog/age-verification-adult-industry/): Identity verification, or age verification in particular, is a must when it comes to age-restricted sectors, such as the adult industry. - [Top 5 Marketplace Fraud Examples You Should Know](https://www.idenfy.com/blog/marketplace-fraud-examples/): Learn the top 5 examples of marketplace fraud, how to avoid getting scammed online, and how to stop fraudsters from damaging your platform. - [The Role of AML Requirements for Payment Processors](https://www.idenfy.com/blog/aml-requirements-payment-processors/): Anti-Money Laundering (AML) requirements are spreading into many jurisdictions, regulating more payment processors that need to be secured. - [What is the Bank Secrecy Act (BSA)?](https://www.idenfy.com/blog/what-is-the-bank-secrecy-act/): Congress set the Bank Secrecy Act (BSA) in 1970, but today it's still a crucial law against money laundering and a way to stay AML-compliant. - [How to Use an Age Verification System? A Guide for Businesses](https://www.idenfy.com/blog/age-verification-system-guide/): An age verification system, or an age gate, is a security measure and a part of ID verification (KYC), crucial for various online businesses. - [A Quick Guide to Simplified Due Diligence (SDD)](https://www.idenfy.com/blog/simplified-due-diligence/): Simplified due diligence (SDD) is the lowest level of customer due diligence that you can apply when verifying and onboarding customers. - [Structuring in Money Laundering Explained](https://www.idenfy.com/blog/structuring-in-money-laundering/): Structuring, or splitting a transaction into smaller sums, is a form of money laundering. With smurfing, they can indicate illegal activity. - [How to Check if Someone Is Using Your Identity? Identity Theft Prevention Guide](https://www.idenfy.com/blog/how-to-check-if-someone-is-using-your-identity/): Unfamiliar activity on your credit report, suspicious health insurance records, newly created accounts - sings someone's using your identity. - [How to Choose the Best KYC Compliance Software in 2025?](https://www.idenfy.com/blog/kyc-compliance-software/): As identity verification becomes vital, companies search how to reduce costs and upgrade efficiency through automated KYC compliance software. - [Case Study: Beera Station](https://www.idenfy.com/use-cases/beera-station-idenfy-study/): Learn how Beera Station integrated iDenfy's age verification solution and ensured global scaling by onboarding users in less than 60 seconds. - [PEPs and Sanctions Checks Explained](https://www.idenfy.com/blog/peps-and-sanctions-checks/): Learn why businesses integrate onboarding and reputational controls, starting with PEPs and sanctions checks for complete AML compliance. - [Customer Due Diligence Solutions — How to Build CDD Compliance?](https://www.idenfy.com/blog/customer-due-diligence-solutions/): Customer due diligence involves various steps: ID and UBO verification, monitoring, etc. Thankfully, using AI solutions helps simplify CDD. - [Account Takeover (ATO): Meaning, Examples, and Fraud Prevention Tactics](https://www.idenfy.com/blog/account-takeover-ato/): Discover the alarming rise of account takeover (ATO) and how it puts the user's or the company's sensitive information at risk. - [Case Study: Mano Bank](https://www.idenfy.com/use-cases/manobank-idenfy-study/): See how Mano Bank transformed its customer onboarding process and ditched inconvenient video calls to biometric identity verification. - [Document Verification: How Does the Process Work?](https://www.idenfy.com/blog/document-verification-process/): Document verification tells if a document is authentic or not. That's why many businesses use it for fraud prevention and KYC/AML compliance. - [Case Study: June](https://www.idenfy.com/use-cases/june-idenfy-study/): Discover how iDenfy helped June and 500+ businesses reduce customer onboarding time and minimize costs with full-stack identity verification. - [Corporate KYC: How to Verify and Onboard Businesses](https://www.idenfy.com/blog/corporate-kyc-business-verification/): Learn how corporate KYC goes beyond verifying people to verifying the legitimacy of a whole business. Discover how it benefits the B2B field. - [KYC Onboarding: How to Achieve Complete Compliance?](https://www.idenfy.com/blog/kyc-onboarding/): Check out insights on the importance of KYC onboarding, best practices, and how to streamline the process for a seamless customer experience. - [What is the Difference Between CDD and EDD?](https://www.idenfy.com/blog/cdd-and-edd/): Looking to understand the difference between CDD and EDD? Learn how to mitigate financial crime risks with a robust compliance program. - [E-commerce Fraud: Guide to Preventing Money Laundering with Identity Verification](https://www.idenfy.com/blog/e-commerce-fraud/): Learn the key factors about e-commerce fraud to protect your business and customers from potential legal and reputational damage effectively. - [Case Study: Residenture](https://www.idenfy.com/use-cases/residenture-idenfy-study/): Check out the testimonial from Residenture to see how iDenfy's KYC solution helped build a fully automated customer onboarding from scratch. - [DAC7 Directive: How Online Marketplaces Should Collect, Verify, and Report Their Data](https://www.idenfy.com/blog/dac7-directive/): The EU's DAC7 Directive has enforced stricter obligations for various digital platforms with the need to collect, verify and report data. - [The Complete Sanctions Screening Guide [Updated 2025]](https://www.idenfy.com/blog/sanctions-screening-guide/): Sanctions screening can prevent fraud, cybercrime, or money laundering for firms. But the geopolitical landscape changes, and so do sanctions. - [KYC in Real Estate: Here's Your Compliance Checklist to Prevent Money Laundering](https://www.idenfy.com/blog/kyc-aml-real-estate/): KYC is the main part of the AML compliance and an obligatory requirement for real estate, a sector very attractive to money launderers. - [Case Study: SupplierPlus](https://www.idenfy.com/use-cases/supplierplus-idenfy-study/): Discover how iDenfy helped SupplierPlus digitize its compliance workflow with powerful AML screening and monitoring tools. - [GPT-4: OpenAI Introduced a New Version of ChatGPT, But What's Different?](https://www.idenfy.com/blog/chat-gpt-4/): GPT-4 is 10 times more advanced than the previous ChatGPT model. It accepts text and image inputs, aces tests, calculates taxes, and more. - [What is Adverse Media Screening? Effective Practice for AML Compliance](https://www.idenfy.com/blog/adverse-media-screening/): Adverse media screening, or negative news, is crucial. But beyond compliance, checking different media is beneficial for managing risks. - [KYC vs AML: Key Differences in Compliance [Updated]](https://www.idenfy.com/blog/kyc-aml-compliance/): From verifying customer identity to checking sanctions and PEP lists. Learn the key differences and find out how KYC and AML work together. - [Identity verification in Shopify with Zapier](https://www.idenfy.com/blog/identity-verification-in-shopify-with-zapier/): Learn how to integrate identity verification into e-commerce powered by Shopify and the automation tool - Zapier. - [AML Compliance Program: 5 Steps that You Need to Take in 2025](https://www.idenfy.com/blog/aml-compliance-program/): AML compliance program defines your actions towards meeting AML requirements. However, effective AML checklist includes multiple steps. - [Is ChatGPT Secure? Here’s Everything You Need to Know ](https://www.idenfy.com/blog/chatgpt-security/): ChatGPT can be a security threat, and malicious attackers already mastered the tricks that pave the way to fraud. But is it actually that bad? - [A Definitive Guide on KYC for Crypto [Updated]](https://www.idenfy.com/blog/kyc-for-crypto/): Access the latest insights on KYC for crypto, the Travel Rule, EU's AMLDs and the related FAQs that blockchain enthusiasts want to know. - [Proxy Network: Use Cases and Identity Verification Tips](https://www.idenfy.com/blog/proxy-security/): Discover the best proxy practices for protecting your network and sensitive information with identity verification. - [Case Study: The Everset](https://www.idenfy.com/use-cases/the-everset-idenfy-study/): Find out how iDenfy is revolutionizing the fraud prevention landscape and helping The Everset save costs with identity verification. - [The Guide to Decentralized Identity in 2023](https://www.idenfy.com/blog/the-guide-to-decentralized-identity-in-2023/): Learn about the history of decentralized identity, integration with blockchain, and its impact on our biometric data. - [Identity Verification WordPress Plugin Setup Guide](https://www.idenfy.com/use-cases/identity-verification-wordpress-plugin-setup-guide/): A short guide on how to get started with identity verification on website powered by WordPress. Read More in Our Blog! - [Understanding Web3 and its Security Measures](https://www.idenfy.com/blog/web3-security-verification/): From Web1 to Web3. It seems that the possibilities are endless and so are the security challenges. That's why we have identity verification. - [iDenfy Through Adomas’ Eyes: Motivation, Challenges, and All That Jazz](https://www.idenfy.com/blog/adomas-product-owner/): Meet our Product Owner, Adomas Vitkauskas! He talks about the essence of communication, collaboration, and the overall life at the startup. - [How Identity Verification is Helping Combat Cryptocurrency Crimes](https://www.idenfy.com/blog/identity-verification-helping-combat-cryptocurrency-crimes/): Learn more about how identity verification helps to combat cryptocurrency crimes. IDenfy is Here to Share Their Knowledge! - [AML Regulations in the USA: Everything You Should Know as a Business Owner](https://www.idenfy.com/blog/aml-regulations-in-the-usa/): Learn about AML regulations in the USA and compliance processes with ongoing customer due diligence (CDD) procedures. - [Case Study: IPRoyal](https://www.idenfy.com/use-cases/iproyal-idenfy-study/): Learn how IPRoyal is successfully verifying thousands of customers per month with iDenfy's AI-powered identity verification solution. - [Frauds in NFTs And The Need For KYC](https://www.idenfy.com/blog/frauds-in-nfts-and-the-need-for-kyc/): Learn about NFTs and why identity verification powered prevents online fraud and builds trust. Click to find more. - [How to Verify Proof of Address in 2025? Here’s the Complete Guide](https://www.idenfy.com/blog/proof-of-address-poa/): What are acceptable forms of proof of address? How to verify your proof of residency? We answer all these questions in our guide to PoA. - [Case Study: PROFI CREDIT](https://www.idenfy.com/use-cases/profi-credit-idenfy-study/): Check out how, with iDenfy, PROFI CREDIT managed to enhance customer onboarding and shorten the verification time via an AI-powered solution. --- ## Glossary - [Know Your Seller (KYS)](https://www.idenfy.com/glossary/know-your-seller-kys/): Learn about Know Your Seller (KYS) verification, common types of seller fraud, popular marketplace scams, and how to prevent them. - [Telemedicine Verification](https://www.idenfy.com/glossary/telemedicine-verification/): Learn about telemedicine verification to find out how it's linked to a standard KYC process, helping prevent fraud while ensuring security. - [Know Your Vendor (KYV)](https://www.idenfy.com/glossary/know-your-vendor-kyv/): Access the key FAQs linked to the Know Your Vendor (KYV) process and find out how this sort of due diligence helps protect your supply chain. - [Decentralized Finance (DeFi)](https://www.idenfy.com/glossary/decentralized-finance-defi/): Learn all about Decentralized Finance (DeFi): if it's a safe option, how it differs from CeFi and the endless opportunities that come with it. - [Magic Link](https://www.idenfy.com/glossary/magic-link/): Discover what a Magic Link is, how it works, and how this feature helps automate user onboarding and other identity verification processes. - [Real-World Assets (RWAs)](https://www.idenfy.com/glossary/real-world-assets-rwas/): Physical or tangible assets can be tokenized, and this is how the concept of Real-World Assets (RWAs) was born. Access the key FAQs. - [Bank Verification API](https://www.idenfy.com/glossary/bank-verification-api/): Look through the main functionalities and benefits of popular bank account verification API solutions, and why this approach might be useful for you. - [Fraud Scoring](https://www.idenfy.com/glossary/fraud-scoring/): Learn how a fraud scoring system works, why it's vital for different industries, and how AI lets you calculate fraud scores more accurately. - [Liveness Detection](https://www.idenfy.com/glossary/liveness-detection/): Learn all about liveness detection, the difference between passive and active liveness checks, and how it's part of the biometric verification. - [SSN Verification](https://www.idenfy.com/glossary/ssn-verification/): Learn why people misuse SSNs for fraud, how they're linked to money laundering, and why SSN verification goes along with other KYC methods. - [Chip Dumping](https://www.idenfy.com/glossary/chip-dumping/): Find out all about chip dumping, its use cases in poker, multiple account fraud, bonus abuse, and other vital nuances, such as if this scheme is legal. - [Rug Pull](https://www.idenfy.com/glossary/rug-pull/): Find out what a rug pull is, how crypto scammers trick investors, and why does this scheme continue to be popular in the digital asset space. - [Collusion in iGaming](https://www.idenfy.com/glossary/collusion-in-igaming/): Learn how player collusion works in iGaming, which online games are used for fraudulent schemes most, and what kind of tools are used for prevention. - [Company Verification](https://www.idenfy.com/glossary/company-verification/): Learn what kind of checks should be included in your company verification process, a vital tool for determining another company's legitimacy. - [Optical Character Recognition (OCR)](https://www.idenfy.com/glossary/optical-character-recognition-ocr/): Learn all about Optical Character Recognition (OCR), where it's used, how different industries implement this technology, and how it's linked to KYC. - [MRZ Code](https://www.idenfy.com/glossary/mrz-code/): Explore the key insights regarding the MRZ code, its use cases, how such encrypted data is linked to identity verification, and more. - [Age Assurance](https://www.idenfy.com/glossary/age-assurance/): Learn about the age assurance process, its requirements in different jurisdictions, and which factors make it unique compared to estimation. - [Employment Verification](https://www.idenfy.com/glossary/employment-verification/): Learn about the process of employment verification, and how it can negatively affect entities that don't use proper ID verification measures. - [End-to-End KYC Process](https://www.idenfy.com/glossary/end-to-end-kyc-process/): Learn what makes end-to-end KYC so special and how it differs from the traditional KYC or identity verification process in different sectors. - [VAT Validation](https://www.idenfy.com/glossary/vat-validation/): Access the main facts about VAT validation, finding out why financial institutions in the EU use this lookup method in KYB verification. - [KYC Verification](https://www.idenfy.com/glossary/kyc-verification/): Learn about KYC verification, what measures are commonly used by banks, and why some institutions require more stringent checks than others. - [Rental Fraud](https://www.idenfy.com/glossary/rental-fraud/): Learn how rental fraud works, why it's vital to have a tenant screening process, and how not to get caught in this sort of scam. - [Employer Identification Number (EIN)](https://www.idenfy.com/glossary/employer-identification-number-ein/): Learn about Employer Identification Number (EIN), its verification practices, why EINs are a big part of KYB compliance, and more. - [Tax Fraud](https://www.idenfy.com/glossary/tax-fraud/): Learn the deceptive practices individuals and businesses use to hide their income and find out how they succeed with tax fraud. - [NIS2 Directive](https://www.idenfy.com/glossary/nis2-directive/): Access the latest insights regarding the EU's new cybersecurity framework, the NIS2 Directive, and see all FAQs in one place. - [Tax Identification Number (TIN)](https://www.idenfy.com/glossary/tax-identification-number-tin/): Learn the structure and factors that make up a valid TIN, or Tax Identification Number, required for US-based entities and individuals. - [Argentina Age Verification](https://www.idenfy.com/glossary/argentina-age-verification/): Curious about the foreign country age verification system? Argentina's age verification law is quite interesting. - [Asset-Referenced Token (ART)](https://www.idenfy.com/glossary/asset-referenced-token/): Learn all about asset-referenced tokens - a cryptocurrency whose value is tied to fiat currency and does not change. - [First-Party Fraud](https://www.idenfy.com/glossary/first-party-fraud/): Explore the main forms of first-party fraud, and find out how it differs from other, more traditional forms of fraud, like identity theft. - [Digital Services Act (DSA)](https://www.idenfy.com/glossary/digital-services-act-dsa/): Access the latest insights on one of EU's laws, or the Digital Services Act (DSA), and know the steps that will help you to stay compliant. - [Email Verification](https://www.idenfy.com/glossary/email-verification/): Learn how email verification works, why it's linked to Know Your Customer (KYC) compliance, and how it's safer than simple passwords online. - [Sanctions Check](https://www.idenfy.com/glossary/sanctions-check/): Learn why it's important to do a sanctions check and screen different sanctions databases before starting a new business relationship with any client. - [Know Your Investor (KYI)](https://www.idenfy.com/glossary/know-your-investor-kyi/): Discover what qualifies someone for specific investor statuses and learn about the Know Your Investor (KYI) verification process. - [Suspicious Transaction Report (STR)](https://www.idenfy.com/glossary/suspicious-transaction-report-str/): Learn what a Suspicious Transaction Report (STR) is, how it differs from other documents, and what reporting requirements you should follow. - [Digital Operational Resilience Act (DORA)](https://www.idenfy.com/glossary/digital-operational-resilience-act-dora/): See the latest details about the Digital Operational Resilience Act (DORA), and how it impacts EU's reporting entities' compliance tasks. - [Money Laundering Reporting Officer (MLRO)](https://www.idenfy.com/glossary/money-laundering-reporting-officer-mlro/): Learn what kind of education and qualifications a Money Laundering Reporting Officer (MLRO) should have, what are their daily tasks, and more. - [Financial Intelligence Unit (FIU)](https://www.idenfy.com/glossary/financial-intelligence-unit/): See a detailed definition explaining what a Financial Intelligence Unit (FIU) is and see concrete examples of FIUs and their responsibilities. - [Card-Not-Present (CNP) Fraud](https://www.idenfy.com/glossary/card-not-present-cnp-fraud/): Yes, card-not-present (CNP) fraud is a challenge due to high chargeback rates and hidden identities of criminals using this scheme. Read more. - [Biometric Authentication](https://www.idenfy.com/glossary/biometric-authentication/): Learn about biometric authentication, its key types, how it actually improves security, and why industries like crypto might want to use it. - [Credit Card Fraud](https://www.idenfy.com/glossary/credit-card-fraud/): Access FAQs people want to find out about credit card fraud, who is responsible for covering the costs, and how to avoid getting scammed. - [Subscription Fraud](https://www.idenfy.com/glossary/subscription-fraud/): Find out how bad actors and users who abuse free trials get tangled up in subscription fraud, leading to chargebacks and other issues. - [Charity Fraud](https://www.idenfy.com/glossary/charity-fraud/): Find out how criminals use charity fraud, if it's possible to detect it in real-time, and how often people actually succeed with it. - [Matched Betting](https://www.idenfy.com/glossary/matched-betting/): Review our explanation of matched betting, why it's considered to be a good investment, and why bookmakers don't want you to use this tactic. - [Embezzlement](https://www.idenfy.com/glossary/embezzlement/): Learn all about embezzlement - one of the most serious forms of financial fraud through reading multiple answers to common questions. - [Corporate Transparency Act (CTA)](https://www.idenfy.com/glossary/corporate-transparency-act/): Access the key FAQs regarding the Corporate Transparency Act (CTA) and Beneficial Ownership Information (BOI) reporting requirements for various entities. - [Secretary of State (SOS)](https://www.idenfy.com/glossary/secretary-of-state-sos/): Access the most popular FAQs regarding the Secretary of State (SOS), how to file, what information or documents are needed in diferrent states, and more. - [Articles of Incorporation](https://www.idenfy.com/glossary/articles-of-incorporation/): Find out who needs to file Articles of Incorporation, why it's important for different types of entities, and what data is required to get approved. - [Certificate of Good Standing](https://www.idenfy.com/glossary/certificate-of-good-standing/): Learn which types of businesses can get a certificate of good standing, why it's important to all companies working in the US, and how to stay compliant. - [Aiding and Betting](https://www.idenfy.com/glossary/aiding-and-betting/): Learn which crimes are often linked to aiding and betting, what it means in the context of gaming and AML compliance, and why you should care about it. - [Customer Due Diligence (CDD)](https://www.idenfy.com/glossary/customer-due-diligence-cdd/): Learn about customer due diligence (CDD), its role in KYC/AML compliance, and why it's important to manage risks and maintain accurate risk profiles. - [AML Geographic Risk](https://www.idenfy.com/glossary/aml-geographic-risk/): Access the key FAQs regarding a company's risk assessment and find out why the AML geographic risk plays a big part in it. - [Crypto-Asset Service Provider (CASP)](https://www.idenfy.com/glossary/crypto-asset-service-provider-casp/): Learn how the MiCA regulation impacted every Crypto-Asset Service Provider (CASP), and learn its key requirements in the digital asset sector. - [Smurfing](https://www.idenfy.com/glossary/smurfing/): Learn how smurfing in money laundering and iGaming differs, and why criminal gangs use this technique to successfully avoid getting caught. - [Know Your Employee (KYE)](https://www.idenfy.com/glossary/know-your-employee/): Stolen details, forged documents or attempts to hide a criminal record are all legitimate reasons why companies verify new hires via Know Your Employee. - [Multi-Factor Authentication](https://www.idenfy.com/glossary/multi-factor-authentication/): Find out all about MFA, or Multi-Factor Authentication, a popular security measure and access control among remote businesses and online platforms. - [Promotion Abuse](https://www.idenfy.com/glossary/promotion-abuse/): Promotion abuse, or promo abuse, is a type of fraud where a user exploits a platform’s (often in iGaming and... - [Device Fingerprinting](https://www.idenfy.com/glossary/device-fingerprinting/): Learn what device fingerprinting is and how it can be used to detect fraud, unusual patterns, including bad actors conducting ATO attacks. - [Personally Identifiable Information (PII)](https://www.idenfy.com/glossary/personally-identifiable-information/): Find out what sort of data is considered Personally Identifiable Information (PII) and why you might be asked to provide sensitive data online. - [Gnoming in Betting](https://www.idenfy.com/glossary/gnoming-in-betting/): Learn how players abuse betting and iGaming sites to their advantage when claiming welcome bonuses and using gnoming, matched betting & more. - [Online Gambling Fraud](https://www.idenfy.com/glossary/online-gambling-fraud/): Look through the most popular tactics in online gambling fraud, getting into the depths of how scammers actually score their winnings in iGaming. - [Third-Party Fraud](https://www.idenfy.com/glossary/third-party-fraud/): Look through some common third-party fraud types and learn how criminals succeed with these types of scams online, focusing on how to protect your identity. - [Bulk Cash Smuggling](https://www.idenfy.com/glossary/bulk-cash-smuggling/): Find out all about bulk cash smuggling, how it works, why criminal networks still use this method for money laundering, and more - all in the form of FAQs. - [Trade-Based Money Laundering](https://www.idenfy.com/glossary/trade-based-money-laundering/): Learn what trade-based money laundering is, and what schemes criminals use to hide their dirty cash without getting caught. - [Digital Identity](https://www.idenfy.com/glossary/digital-identity/): Find out how your digital identity is used online, and why many businesses ask their customers to complete various identity verification procedures. - [Ongoing Due Diligence (ODD)](https://www.idenfy.com/glossary/ongoing-due-diligence/): Learn what ongoing due diligence (ODD) is, and how it is related to continuous monitoring and other due diligence measures required for KYC/AML compliance. - [Proof of Funds](https://www.idenfy.com/glossary/proof-of-funds/): Learn what type of documents can be accepted of proof of funds (POF), and when companies are required to follow this verification process. - [Australia’s Social Media Ban](https://www.idenfy.com/glossary/australias-social-media-ban/): Learn about the latest restrictions for social media users who are underage, and how this social media ban would look i practice according to Australia. - [Proof of Income](https://www.idenfy.com/glossary/proof-of-income/): Explore the key documents that are considered to be proof of income and learn why companies might ask you to complete this verification process. - [MiCA Regulation](https://www.idenfy.com/glossary/mica-regulation/): Access the latest news regarding the Markets in Crypto Assets, or the MiCA regulation in one place and learn how to comply with this framework in the EU. - [NFC Verification](https://www.idenfy.com/glossary/nfc-verification/): Learn what NFC technology is, and how it can be used in NFC verification, similarly to Apple Pay and other applications that are powered by it. - [Forex (FX) Trading](https://www.idenfy.com/glossary/forex-trading/): Learn what forex trading, or FX trading is by debunking common misconceptions and risks through simple and concise FAQs in our glossary. - [Database Verification](https://www.idenfy.com/glossary/database-verification/): Find all the latest FAQs regarding the database verification process in one place and learn why this KYC method is more considered to be more secure. - [Responsible Gaming](https://www.idenfy.com/glossary/responsible-gaming/): Find out what measures iGaming, gambling, casino and other gaming establishments implement to secure their players and ensure responsible gaming. - [Identity Verification](https://www.idenfy.com/glossary/identity-verification/): Access the key FAQs that both businesses and users have towards the identity verification process and its different forms that can still cause confusion. - [Virtual Asset](https://www.idenfy.com/glossary/virtual-asset/): Learn about the key qualifications that a virtual asset (VA) should have, FATF's standpoint, the regulations that VASPs face, and more FAQs in one place. - [Integration in Money Laundering](https://www.idenfy.com/glossary/integration-in-money-laundering/): Learn about the third stage of money laundering - integration - and found out the main tactics criminals use to clean dirty cash without getting caught. - [Neobank](https://www.idenfy.com/glossary/neobank/): Do you know the definition of a neobank? Or what's the difference between neobanks and online banking service providers? We provide the key insights. - [Multi-Accounting](https://www.idenfy.com/glossary/multi-accounting/): Learn why many are tempted to get involved in multi-accounting, and how it has became a common practice for promo abuse in industries like iGaming. - [Know Your Business (KYB)](https://www.idenfy.com/glossary/know-your-business-kyb/): Learn the latest news about Know Your Business (KYB) and access FAQs on how to onboard other companies and comply with ever-evolving regulations. - [eIDV](https://www.idenfy.com/glossary/eidv/): Find out about eIDV, or Electronic Identity Verification, and access the key FAQs that you should know for both an effective and compliant KYC flow. - [Phone Verification](https://www.idenfy.com/glossary/phone-verification/): Access all the FAQs regarding Phone Verification in once place, focusing on simple explanations regarding the process, and why it's important. - [Bank Verification](https://www.idenfy.com/glossary/bank-verification/): Learn all about the Bank Verification process, its key components, and what kind of institutions conduct this extra verification step on their users. - [Adverse Media](https://www.idenfy.com/glossary/adverse-media/): Access a brief explanation of what adverse media is, and why companies sometimes need to screen such negative news to find out links to crime. - [Non-Doc Verification](https://www.idenfy.com/glossary/non-doc-verification/): Learn what non-doc verification is and how it can be used as a more streamlined approach to both identity verification and address verfication. - [Know Your Customer (KYC)](https://www.idenfy.com/glossary/know-your-customer/): Access the main definition of Know Your Customer, also known as KYC verification, and scroll through the main FAQs linked to this topic. - [Sole Proprietorship](https://www.idenfy.com/glossary/sole-proprietorship/): Learn what a sole proprietorship is, how taxes are calculated in this case, and how it differs from LLCs in terms of KYC/KYB compliance regulations. - [Online Casino Verification](https://www.idenfy.com/glossary/online-casino-verification/): Learn why online casino verification is a mandatory KYC/AML requirement in many countries for a secure gaming environment and a fraud-free system. - [Transaction Monitoring](https://www.idenfy.com/glossary/transaction-monitoring/): Find a concentrated guide on transaction monitoring by exploring the key FAQs linked to AML compliance requirements and FATF recommendations. - [Bank Account Verification](https://www.idenfy.com/glossary/bank-account-verification/): Learn why banks need to check ID documents, bank statements and other personal details when opening a bank account — all through simple FAQs. - [AI Fraud](https://www.idenfy.com/glossary/ai-fraud/): Find out what kind of scams and deceptive practices fall into the "AI fraud" category and explore the key tactics where AI can be used against people. - [Age Gating](https://www.idenfy.com/glossary/age-gating/): Learn all about an age gate, find out if it's easily bypassed, why certain platforms have this function and other key FAQs linked to this topic. - [Know Your Merchant (KYM)](https://www.idenfy.com/glossary/know-your-merchant-kym/): Learn about the key Know Your Merchant (KYM) measures and access FAQs linked to merchant onboarding and KYC/KYB/AML regulatory requirements. - [Vending Machine Age Verification](https://www.idenfy.com/glossary/vending-machine-age-verification/): Learn how businesses found a new niche - vending machines - and find out the main age verification points that age-restricted sellers should know. - [Romance Scam](https://www.idenfy.com/glossary/romance-scam/): Remember the Tinder Swindler? Learn how a romance scam can actually be successful, and how both users and platforms can prevent such fraud. - [Synthetic Identity Fraud](https://www.idenfy.com/glossary/synthetic-identity-fraud/): Find out about synthetic identity fraud and discover how fraudsters create these false personas to max out credit cards, access loans and more. - [Payment Fraud](https://www.idenfy.com/glossary/payment-fraud/): Explore the different types of payment fraud and learn the negative effects that can happen when fraudulent transactions slip under the radar. - [Face Authentication](https://www.idenfy.com/glossary/face-authentication/): Understand the main principles behind Face Authentication and access the key FAQs regarding this concept in identity verification. - [Mississippi Age Verification Law](https://www.idenfy.com/glossary/mississippi-age-verification-law/): Learn what is Mississippi Age Verification Law (SB 2346), and how it helps to protect children from pornographic media exposure. - [Triangulation Fraud](https://www.idenfy.com/glossary/triangulation-fraud/): Learn what is triangulation fraud, how it affects marketplaces, and what kind of red flags should users look out for when shopping online. - [Ultimate Beneficial Owner (UBO)](https://www.idenfy.com/glossary/ultimate-beneficial-owner/): Learn the criteria, which makes a person an ultimate beneficial owner, or UBO, and access FAQs regarding to a company's ownership structure. - [Money Mule](https://www.idenfy.com/glossary/money-mule/): Find a simple definition explaining what a money mule is, how a person can be recruited to become an accomplice to money laundering, and more. - [The Kids' Online Safety Act (KOSA)](https://www.idenfy.com/glossary/the-kids-online-safety-act-kosa/): Learn about The Kids' Online Safety Act (KOSA) as a new U.S. regulation with concrete questions answered by iDenfy. - [Louisiana Age Verification Law](https://www.idenfy.com/glossary/louisiana-age-verification-law/): Find out the latest updates and FAQs regarding Louisiana's Age Verification Law, Secure Online Child Interaction and Age Limitation Act. - [Arkansas Social Media Safety Act](https://www.idenfy.com/glossary/arkansas-social-media-safety-act/): All frequently asked questions, concise definition and more context about the Arkansas Social Media Safety Act explained in one place. - [Protection and Electronic Documents Act (PIPEDA)](https://www.idenfy.com/glossary/protection-and-electronic-documents-act/): Access the definition and the key insights on the Protection and Electronic Documents Act (PIPEDA) and related questions in one place. - [Proof of Address (PoA)](https://www.idenfy.com/glossary/proof-of-address/): Find out which documents are accepted as proof of address (PoA) and which companies are required to conduct address verification checks. - [Utility Bill](https://www.idenfy.com/glossary/utility-bill/): Learn what makes a utility bill a valid form of Proof of Address (PoA) and explore the key FAQs regarding these types of documents. - [KYC Risk Rating](https://www.idenfy.com/glossary/kyc-risk-rating/): Learn why KYC Risk Rating is important, access related FAQs, and find out the key KYC/AML requirements in one place. - [UK Online Safety Bill](https://www.idenfy.com/glossary/uk-online-safety-bill/): See the most important FAQs regarding the UK Online Safety Bill, which involves more stringent age verification requirements for online platfroms. - [Generative AI Fraud](https://www.idenfy.com/glossary/generative-ai-fraud/): Find out what generative AI fraud really is and learn about new, highly sophisticated deepfake attacks, fraudulent methods to fake ID documents, and more. - [Federal Trade Commission (FTC)](https://www.idenfy.com/glossary/federal-trade-commission-ftc/): Find out what is the exact role f the Federal Trade Commission (FTC), its mission and updates linked to the use of AI, data protection, and more. - [Online Safety Act 2023](https://www.idenfy.com/glossary/online-safety-act-2023/): Find out the key FAQs and recent updates regarding the UK's Online Safety Act 2023, including the measures regulated online platforms should take. - [Deepfake](https://www.idenfy.com/glossary/deepfake/): Find out the antics and the specifics behind deepfake technology, getting a quick glimpse into its history, definition, and more burning FAQs. - [Gambling Act 2005](https://www.idenfy.com/glossary/gambling-act-2005/): Access the main questions and answers regarding the most important gambling and iGaming regulation rule set in the UK, the Gambling Act 2005. - [Virginia Age Verification Law](https://www.idenfy.com/glossary/virginia-age-verification-law/): Access the new information and the most common FAQs regarding the Virginia Age Verification Law, requiring companies to check users' IDs and age. - [Utah Age Verification Law](https://www.idenfy.com/glossary/utah-age-verification-law/): Find out the recent updates and FAQs regarding Utah's Age Verification law, requiring age-restricted service providers integrate identity verification. - [Beneficial Owner](https://www.idenfy.com/glossary/beneficial-owner/): Explore the key FAQs regarding beneficial ownership and learn why it's important to identify a company's beneficial owner and corporate structure. - [USA Patriot Act](https://www.idenfy.com/glossary/usa-patriot-act/): After the shocking 9/11 attack, regulators knew they needed to focus more on the terrorism and similar offences, presenting the USA Patriot Act of 2001. - [Know Your Supplier (KYS)](https://www.idenfy.com/glossary/know-your-supplier/): Discover what it really means to "know" and verify your third-party partners using a due diligence measure known as Know Your Supplier (KYS). - [Age Verification System](https://www.idenfy.com/glossary/age-verification-system/): Age gates? How about a proper age verification system, where both document verification and biometric selfie checks are combined. Explore more tips. - [AML Screening Software](https://www.idenfy.com/glossary/aml-screening-software/): Cross-checking users against different PEPs and sanctions lists, global watchlists, adverse mediacan be all done with AML screening software. - [Travel Rule](https://www.idenfy.com/glossary/travel-rule/): Find what the FATF's Travel Rule actually means for virtual asset service providers (VASPs) and more about the key crypto AML compliance measures. - [CDD Final Rule](https://www.idenfy.com/glossary/cdd-final-rule/): The CDD Final Rule presents stricter beneficial ownership aimed at detecting criminals who exploit companies for their illegal activities. - [Suspicious Activity Report (SAR)](https://www.idenfy.com/glossary/suspicious-activity-report-sar/): Identify a potential fraud case or suspect money laundering? Yes, as per FinCEN, you must file a Suspicious Activity Report (SAR). - [Office of Foreign Assets Control (OFAC)](https://www.idenfy.com/glossary/office-of-foreign-assets-control-ofac/): Office of Foreign Assets Control (OFAC) administers and enforces different sanctions programs, but this isn't the only area of work they do. - [Financial Crimes Enforcement Network (FinCEN)](https://www.idenfy.com/glossary/financial-crimes-enforcement-network-fincen/): Explore FAQs linked to the Financial Crimes Enforcement Network (FinCEN): its ways for tracking suspicious activity, AML measures, and more. - [Financial Action Task Force (FATF)](https://www.idenfy.com/glossary/financial-action-task-force-fatf/): Learn about the key players in the policy-making world, the Financial Action Task Force (FATF), and its biggest impact on regulatory reforms. - [Enhanced Due Diligence (EDD)](https://www.idenfy.com/glossary/enhanced-due-diligence-edd/): Enhanced due diligence (EDD) is more than just the highest level of due diligence performed for your risk-based approach to AML. Find out why. - [Document Check](https://www.idenfy.com/glossary/document-check/): Learn what a document check is in the context of identity verification and why it's a key tool to ensure Know Your Customer (KYC) compliance. - [Currency Transaction Report (CTR)](https://www.idenfy.com/glossary/currency-transaction-report-ctr/): Learn what information to include in a Currency Transaction Report (CTR) for effective anti-money laundering (AML) compliance in the US. - [Anti-Money Laundering (AML)](https://www.idenfy.com/glossary/anti-money-laundering-aml/): What is AML in simple terms? Anti-money laundering (AML) refers to the laws and regulations governments create to detect and prevent crime. - [Business Verification](https://www.idenfy.com/glossary/business-verification/): How to get your partners and all corporate entities onboarded? Explore the basics of Business Verification and KYB automation opportunities. - [California Consumer Privacy Act (CCPA)](https://www.idenfy.com/glossary/california-consumer-privacy-act-ccpa/): Can you actually simplify your compliance processes? Yes, but for starters, you should learn about the California Consumer Privacy Act (CCPA). - [AMLID](https://www.idenfy.com/glossary/amlid-2/): Get a glimpse into AMLID, or the Anti-Money Laundering International Database, its definition, purpose and other related FAQs. - [AML Risk Assessment](https://www.idenfy.com/glossary/aml-risk-assessment/): Looking for a clear definition? Learn what measures actually complete a proper and compliant anti-money laundering (AML) risk assessment. --- # # Detailed Content ## Pages ### Identity Verification for Web Hosting and NIS2 Compliance > Learn about NIS2 compliance changes impacting web hosting providers and domain registrars starting in 2025. - Published: 2025-02-26 - Modified: 2025-02-28 - URL: https://www.idenfy.com/nis2-compliance-web-hosting/ --- ### KYC Mobile SDK for Effortless Identity Verification > Integrate the KYC mobile SDK for your native applications, including support for Flutter, ReactNative, and other platforms. - Published: 2025-02-12 - Modified: 2025-03-21 - URL: https://www.idenfy.com/kyc-mobile-sdk/ --- ### Email confirmation - Published: 2025-01-15 - Modified: 2025-01-15 - URL: https://www.idenfy.com/email-confirmation-kyb/ --- ### Create your kyb account - Published: 2025-01-15 - Modified: 2025-01-15 - URL: https://www.idenfy.com/create-your-kyb-account/ --- ### About us > iDenfy is a technology company that make the world better place to live: fraud prevention, identity verification, anti money laundering solutions. - Published: 2025-01-15 - Modified: 2025-05-19 - URL: https://www.idenfy.com/about-us/ --- ### Identity Verification for Securing, Promoting & Monetizing Music > Verify musicians, ensure fraud-free subscriptions, convert more global artists and ensure secure music streaming using identity verification. - Published: 2024-11-26 - Modified: 2025-01-20 - URL: https://www.idenfy.com/identity-verification-for-music/ --- ### Sole Proprietorship Verification Service > Learn about Sole Proprietorship Verification Service offered as part of KYB workflow to streamline business onboarding. - Published: 2024-11-05 - Modified: 2024-11-13 - URL: https://www.idenfy.com/sole-proprietorship-verification/ --- ### Instant AI Company Data Crossmatch > Learn about iDenfy's AI powered company data crossmatch functionality used to find discrepancies, or correlations during business verification. - Published: 2024-10-31 - Modified: 2025-03-04 - URL: https://www.idenfy.com/instant-ai-company-data-check/ --- ### Adverse Media Screening Service > Learn about iDenfy's Adverse Media Screening Service as part of the full AML compliance software. - Published: 2024-10-16 - Modified: 2024-10-17 - URL: https://www.idenfy.com/adverse-media-screening-service/ --- ### Sanctions Screening Software > Learn about iDenfy's AML Sanctions Screening Software to continuously monitor your customers against worldwide watchlist and PEPs list. - Published: 2024-10-13 - Modified: 2024-10-17 - URL: https://www.idenfy.com/sanctions-screening-software/ --- ### e-IDV Verification Service > Instantly verify customers with e-IDV verification service to match customers data across USA databases within 30 seconds. - Published: 2024-10-13 - Modified: 2025-04-09 - URL: https://www.idenfy.com/e-idv-verification-service/ --- ### Pricing & Plans > iDenfy pricing page with all KYC, AML and KYB features and according packages per different verification volumes. - Published: 2024-10-10 - Modified: 2024-12-17 - URL: https://www.idenfy.com/pricing-plans/ --- ### Bank Verification Service > Learn about Bank Account Verification services and how iDenfy's solution offers instant onboarding and an access to customer's spending history. - Published: 2024-10-09 - Modified: 2024-11-08 - URL: https://www.idenfy.com/bank-verification-service/ --- ### Identity Verification for the Trading Industry > Learn about how identity verification, AML services are used across trading industry in forex exchanges, instant trading, etc. - Published: 2024-09-30 - Modified: 2024-10-02 - URL: https://www.idenfy.com/identity-verification-for-trading/ --- ### Age Verification Software > Learn about how to choose the best age verification service provider, by comparing age extraction methods, liveness verification. - Published: 2024-09-30 - Modified: 2024-10-17 - URL: https://www.idenfy.com/age-verification-software/ --- ### Identity Verification in Gambling > Learn about identity verification in gambling industry, how to choose the best KYC provider for iGaming companies. - Published: 2024-09-30 - Modified: 2024-10-02 - URL: https://www.idenfy.com/identity-verification-for-gambling/ --- ### Why choose iDenfy vs. Onfido? > Learn about differences between iDenfy and Onfido, the KYC and AML vendors. Compare the identity verification pricing and software features. - Published: 2024-09-04 - Modified: 2024-09-04 - URL: https://www.idenfy.com/idenfy-vs-onfido/ --- ### Why choose iDenfy vs. Trulioo? > Learn about differences between iDenfy and Trulioo, the KYC and AML vendors. Compare the identity verification pricing and software features. - Published: 2024-09-04 - Modified: 2024-09-04 - URL: https://www.idenfy.com/idenfy-vs-trulioo/ --- ### Why choose iDenfy vs. Persona? > Learn about differences between iDenfy and Persona, the KYC and AML vendors. Compare the identity verification pricing and software features. - Published: 2024-09-04 - Modified: 2024-09-04 - URL: https://www.idenfy.com/idenfy-vs-persona/ --- ### Why choose iDenfy vs. Veriff? > Learn about differences between iDenfy and Veriff, the KYC and AML vendors. Compare the identity verification pricing and software features. - Published: 2024-09-03 - Modified: 2024-09-04 - URL: https://www.idenfy.com/idenfy-vs-veriff/ --- ### Perpetual KYB Solution > Learn about Perpetual KYB (pKYB) services and how iDenfy's business verification solution meets compliance requirements. - Published: 2024-08-19 - Modified: 2024-10-17 - URL: https://www.idenfy.com/pkyb-service/ --- ### Know Your Patient (KYP) Verification > Learn about Know Your Patient (KYP) Verification services and how iDenfy's identity verification helps with age verification. - Published: 2024-08-09 - Modified: 2024-09-12 - URL: https://www.idenfy.com/know-your-patient-kyp-verification/ --- ### One-Click UBO Verification Service > UBO verification service to identify key shareholders, required for the Know Your Business verification. Know Your Business verification. - Published: 2024-08-09 - Modified: 2024-10-21 - URL: https://www.idenfy.com/ubo-verification-service/ --- ### Identity Verification for E-Commerce Platforms & Marketplaces > Learn about identity verification, AML verification solutions, required to build secure e-commerce marketplace. - Published: 2024-08-09 - Modified: 2024-08-21 - URL: https://www.idenfy.com/identity-verification-e-commerce/ --- ### Utility Bill Verification Service with AI-Powered Precision > Utility Bill Verification Service compares the provided data with extracted information for all non-latin languages. - Published: 2024-07-17 - Modified: 2024-10-17 - URL: https://www.idenfy.com/utility-bill-verification-service/ --- ### Careers v2 - Published: 2024-07-04 - Modified: 2024-07-04 - URL: https://www.idenfy.com/careers-v2/ --- ### Bubble KYC Integration > Integrate the Bubble KYC plugin and start onboarding customers instantly without additional code. - Published: 2024-07-04 - Modified: 2024-10-18 - URL: https://www.idenfy.com/bubble-kyc-plugin/ --- ### Advanced Customer Risk Assessment Service > Integrate customer risk assessment service for businesses. Set custom rules and use your workflow with Know Your Business onboarding. - Published: 2024-04-30 - Modified: 2024-10-17 - URL: https://www.idenfy.com/customer-risk-assessment-service/ --- ### AML Screening & Ongoing Monitoring Software > AML Screening & Ongoing Monitoring service. Check manually or Get Notified Instantly via API. Company AML Screening Software included. - Published: 2024-04-04 - Modified: 2025-05-02 - URL: https://www.idenfy.com/aml-screening/ --- ### Face Authentication service > Integrate Face Authentication to re-verify your existing customers after completing successful KYC verification. Takes 15 seconds on average. - Published: 2024-02-05 - Modified: 2024-09-11 - URL: https://www.idenfy.com/face-authentication-service/ --- ### Careers > We fight against money laundering, terrorism financing, and other fraudulent activities using the latest technologies. Join our team. - Published: 2024-01-31 - Modified: 2024-07-30 - URL: https://www.idenfy.com/careers/ --- ### Know Your Business Solution designed for compliance teams > Try the Know Your Business solution with integrated custom forms creation, shareholders and UBOs extraction, and ongoing AML screening. - Published: 2024-01-09 - Modified: 2025-02-06 - URL: https://www.idenfy.com/know-your-business-solution/ --- ### Homepage v3 > Identity verification service for user onboarding. Mitigate fraud with instant ID verification. Meet Know Your Customer, AML regulations. - Published: 2023-10-19 - Modified: 2025-04-01 - URL: https://www.idenfy.com/ --- ### Try for free - Published: 2023-10-18 - Modified: 2025-03-06 - URL: https://www.idenfy.com/try-for-free/ --- ### Pricing - Published: 2023-10-18 - Modified: 2024-05-29 - URL: https://www.idenfy.com/pricing/ --- ### Talk to sales - Published: 2023-10-18 - Modified: 2024-05-29 - URL: https://www.idenfy.com/talk-to-sales/ --- ### Enhance your WooCommerce site with identity verification > Integrate identity verification for WooCommerce site within 5 minutes. - Published: 2023-10-17 - Modified: 2024-10-18 - URL: https://www.idenfy.com/identity-verification-woocommerce/ --- ### Why choose iDenfy vs. Sumsub? > Learn about differences between iDenfy and Sumsub, the KYC and AML vendors. Compare the identity verification pricing and software features. - Published: 2023-10-16 - Modified: 2024-10-18 - URL: https://www.idenfy.com/idenfy-vs-sumsub/ --- ### Consumer Agreement - Published: 2023-06-12 - Modified: 2025-05-12 - URL: https://www.idenfy.com/agreement/ Service Agreement Terms of services Definitions Scope of services Scope of data processing Representations and obligations Limitation of liability Financial conditions Validity of the agreement Confidentiality Force majeure Final conditions Service Level Agreement Conditions Management of incidents Data Processing Agreement Agreement Regulatory compliance Obligations of company Obligations of service provider Audit Liability and indemnity Law applicability Resolution of disputes Termination Variation of this agreement Brexit Subprocessors Categories of personal data Data retention periods Data breach notification Security controls Document Control Document history Download agreement PLEASE, READ THESE SERVICE AGREEMENTS, INCLUDING TERMS OF SERVICES, SERVICE ORDER FORM, INVOICE, SERVICE LEVEL AGREEMENT, AND THE DATA PROCESSING AGREEMENT THAT IS PART OF THIS SERVICE AGREEMENT, VERY CAREFULLY. BY DOWNLOADING, ACCESSING, OR USING THE "iDenfy" MATERIALS, CUSTOMER AGREES TO BE BOUND BY THIS GENERAL AGREEMENT AND ALL TERMS INCORPORATED BY REFERENCE. IF CUSTOMER DOES NOT AGREE TO ALL OF THE BELOW TERMS, OR IF YOU ARE NOT ENTITLED TO REPRESENT THE CUSTOMER, DO NOT USE THE "iDenfy" MATERIALS AND/OR SERVICES. iDenfy, company registration number 304617621, address Barsausko g. 59, LT-51423, Kaunas, Lithuania represented by the CEO Domantas Ciulde (hereinafter referred to as the ''Service Provider/iDenfy") and the client (details of the client shall be provided in the Service Order Form. The client, hereinafter referred to as the "Client/Service Recipient/Customer"), hereinafter collectively referred to as the Parties and individually as the Party, have entered into this agreement, hereinafter the Terms, Service Order Form, Invoice, Service Level Agreement, and the Data Processing Agreement shall be referred to as the Agreement/Contract: Terms of Service The Terms of Service ("Terms") apply to your access to, and use of, the websites, mobile applications, software development kits, and other products and Services that have been linked to these Terms offered by "iDenfy". These Terms do not alter the terms or conditions of any other agreement you may have with "iDenfy" for products, services, or otherwise. If you are using the Services on behalf of any entity, you represent and warrant that you are authorised to accept these Terms on such entity's behalf and that such entity agrees to be responsible to us if you violate these Terms. "iDenfy" reserves the right to amend or modify these Terms at any time at its sole discretion. Any such changes shall be communicated to the Client via the email address (such notification will be sent to the same email as the invoice) no later than thirty (30) calendar days before the effective date of the amendments. If the Client does not agree to the amended Terms, the Client may terminate this Contract by providing written notice to "iDenfy" before the effective date of the changes. Continued use of the Services after the effective date shall constitute acceptance of the amended Terms. Definitions In this Agreement, including its preamble, these capitalized terms have the following meanings: The ServiceThis means all the services selected by the Service Recipient as established and described in the Service Order Form and provided by the Service Provider either directly... --- ### Customers > Learn about iDenfy's identity verification solution, trusted by more than 500 customers worldwide. - Published: 2023-05-31 - Modified: 2025-03-06 - URL: https://www.idenfy.com/customers/ --- ### Email confirmation - Published: 2023-05-02 - Modified: 2023-05-02 - URL: https://www.idenfy.com/email-confirmation-aml/ --- ### My account - Published: 2023-03-27 - Modified: 2023-03-27 - URL: https://www.idenfy.com/my-account/ --- ### Checkout - Published: 2023-03-27 - Modified: 2023-03-27 - URL: https://www.idenfy.com/checkout/ --- ### Cart - Published: 2023-03-27 - Modified: 2023-03-27 - URL: https://www.idenfy.com/cart/ --- ### Revolutionize identity verification in the transport industry > Learn about identity verification in the transportation industry. We offer AML compliance, KYB, face authentication to complete fraud prevention. - Published: 2023-03-16 - Modified: 2023-06-24 - URL: https://www.idenfy.com/revolutionize-identity-verification-in-the-transport-industry/ --- ### Customizable KYC for every streaming platform > Learn about KYC and how it prevents online fraud for streaming services, by detecting deep fakes, face masks or fraudulent documents. - Published: 2023-03-16 - Modified: 2023-06-13 - URL: https://www.idenfy.com/customizable-kyc-for-every-streaming-platform/ --- ### Free ID Verification Service > Free identity verification service to maximize conversion and minimize fraud. Use free ID verification for quick users onboarding. - Published: 2023-03-03 - Modified: 2025-03-06 - URL: https://www.idenfy.com/free-identity-verification-service/ --- ### Identity Verification for Gaming > ID verification for the Gaming. Learn how to use identity verification for age verification and prevent fraud effectively for your gamers. - Published: 2022-12-01 - Modified: 2023-10-31 - URL: https://www.idenfy.com/identity-verification-for-gaming/ --- ### Identity Verification for Crypto, Blockchain & NFT Compliance > Whether you’re launching a crypto exchange, DeFi project, or token, iDenfy makes identity verification a breeze so you stay compliant. - Published: 2022-11-11 - Modified: 2024-09-05 - URL: https://www.idenfy.com/identity-verification-crypto/ --- ### Report Abuse > At iDenfy, we take security very seriously and enforce measures to detect and prevent spam, phishing, illegal copyright, and trademark usage. - Published: 2022-10-29 - Modified: 2024-11-04 - URL: https://www.idenfy.com/report-abuse/ At iDenfy, we take security very seriously and enforce measures to detect and prevent any illegal activity or unethical behavior. This form is the fastest way to report a case of abuse. hbspt. forms. create({ region: "na1", portalId: "6082545", formId: "f2675a3c-d6d5-443c-9f3e-663b07838974" }); --- ### Verify any proof of address document with ease > Perform address verification and confirm proof of address documents in seconds. Say goodbye to time-consuming customer onboarding. - Published: 2022-10-19 - Modified: 2025-04-24 - URL: https://www.idenfy.com/proof-of-address-verification/ --- ### Identity Verification for Proxy Networks > Protect your proxy networks from fraudulent activity and chargeback threats with identity verification. Don't Miss Out! - Published: 2022-10-10 - Modified: 2023-10-31 - URL: https://www.idenfy.com/identity-verification-for-proxy-networks/ --- ### Cyber Insurance - Published: 2022-08-04 - Modified: 2024-07-29 - URL: https://www.idenfy.com/cyber-insurance/ Insurance for all identity verification, fraud prevention, and anti-money laundering solutions iDenfy consistently takes many safeguards toward safety when it comes to its clients. All iDenfy products are covered by Cyber insurance and Technology Errors & Omissions (Technology E&O) by – Lloyd's of London Coverholder. All iDenfy customers will be guaranteed that our insurers will compensate them for losses that are our fault. What does cyber insurance cover? For each and every claim and in the aggregate 500,000 € (costs inclusive): Technology professional liability Multimedia liability Third-Party Security and Privacy Liability Privacy Regulatory actions Privacy Breach Response, Customer Notification & Crisis Management Data Recovery and Business income losses Cyber extortion iDenfy products covered by insurance Products are covered by Lloyds insurance: Identity verification Business verification AML screening and monitoring NFC verification Proxy detection Fraud scoring Phone verification How to claim? Firstly, you need to register your claim with iDenfy. Please email your claim to info@idenfy. com. The iDenfy team will review it and register it for further processing with the cover holder at Lloyds. Insurance validity Current insurance validity is: 11th of July, 2024 till 11th of July, 2025 Certificate Download the insurance certificate here. Guaranteed by www. lloyds. com --- ### Email confirmation - Published: 2022-07-21 - Modified: 2022-07-21 - URL: https://www.idenfy.com/email-confirmation/ --- ### ID verification in Your WordPress site > ID Verification in Your WordPress Site. Install Our Official App and Prevent Internet Fraud Starting Today! - Published: 2022-07-15 - Modified: 2024-10-18 - URL: https://www.idenfy.com/id-verification-wordpress/ --- ### Freemium vs. Preemium - Published: 2022-07-15 - Modified: 2023-01-04 - URL: https://www.idenfy.com/freemium-vs-preemium/ Features Freemium Premium Supported documents 200 documents 2500+ documents Data storage time Maximum 30 days Up to 12 years MRZ verification Face matching Document reading Full OCR Template (document type) detection Unauthorized face detection AML check Negative news Fraud probability Global data source check IP proxy check Phone number validation LID Liveness Duplicated face and documents prevention Utility bill check 24/7 Human Supervision Account 1 Dashboard account Unlimited Dashboard accounts Attempts to pass the identity verification flow 2 Custom White-label Support Verification statistics Credits usage information Additional products AML check, AML monitoringKYB – Know Your BusinessBank Verification --- ### The Complete Identity Verification Solution > Identity verification services, automated and enforced with manual oversight. Verify the customer's identity quickly and securely. - Published: 2022-05-31 - Modified: 2025-04-30 - URL: https://www.idenfy.com/identity-verification-service/ --- ### Business verification services with everything you need in one API > All in one business verification services. Business verification using 180 global business registries and major credit bureaus. - Published: 2022-04-25 - Modified: 2025-04-23 - URL: https://www.idenfy.com/business-verification-services/ --- ### Download report: Fighting Fintech Fraud with Identity Verification > Download the report on how to fight online fraud in Fintech. Learn how to use ID verification and other fraud prevention systems in Fintech. - Published: 2022-03-07 - Modified: 2022-03-07 - URL: https://www.idenfy.com/fighting-online-fintech-fraud/ hbspt. forms. create({ region: "na1", portalId: "6082545", formId: "1a7c64cf-a3af-48cb-8d78-07b2b674c3c1" }); --- ### Download report: Fighting Fintech Fraud with Identity Verification > Download the report on how to fight online fraud in Fintech. Learn how to use ID verification and other fraud prevention systems in Fintech. - Published: 2022-03-07 - Modified: 2022-03-07 - URL: https://www.idenfy.com/fighting-online-fintech-fraud/ hbspt. forms. create({ region: "na1", portalId: "6082545", formId: "1a7c64cf-a3af-48cb-8d78-07b2b674c3c1" }); --- ### Identity Verification for Fintech Industry > ID verification for the Fintech industry. Learn how to use identity verification and prevent fraud effectively for Fintech company. - Published: 2022-03-07 - Modified: 2025-05-06 - URL: https://www.idenfy.com/identity-verification-for-fintech/ --- ### Download report: Fighting Online Gaming Fraud with Identity Verification - Published: 2022-02-22 - Modified: 2022-02-22 - URL: https://www.idenfy.com/download-report-fighting-fintech-fraud-and-crime-with-identity-verification/ hbspt. forms. create({ region: "na1", portalId: "6082545", formId: "f231f2fd-3df3-474c-983c-30d0ef881992" }); --- ### Deep Phone Number Check & Validation > Phone verification and validation. Detect fraud patterns with phone verification by scanning multiple data points of the phone number. - Published: 2021-11-05 - Modified: 2025-03-14 - URL: https://www.idenfy.com/phone-verification/ --- ### Filter customer’s IP with Proxy Detection Service > Proxy detection Service. Real-time anonymous IP detection and scoring. Prevent fraud in its tracks with seamless intervention. - Published: 2021-10-26 - Modified: 2025-03-03 - URL: https://www.idenfy.com/proxy-detection-ip-insight/ --- ### NFC chip-based identity verification > Near Field Communication (NFC) technology use for identity verification. Scan ePassports to to confirm authenticity and integrity with NFC. - Published: 2021-10-26 - Modified: 2024-08-21 - URL: https://www.idenfy.com/nfc-verification/ --- ### Assess Your Customer’s Risk Score > Fraud scoring system to detect and prevent fraudulent transactions. Customer evaluation solution to ensure legitimate transactions. - Published: 2021-10-22 - Modified: 2023-10-31 - URL: https://www.idenfy.com/fraud-scoring/ --- ### Supported AML databases > Supported Supported AML databases laundering databases. Politically Exposed Persons and Sanctions List, Watch List, Most Wanted List. - Published: 2021-04-28 - Modified: 2023-02-17 - URL: https://www.idenfy.com/supported-aml-databases/ Supported Politically Exposed Persons and Sanctions List  Politically Exposed Persons Internal PEPs list.   International  OICV-IOSCO, World Bank, United, Nations - Consolidated sanctions list, United Nations - Development, Programme / Ineligibility List, United Nations - Office for Project, Services / Vendor Sanctions, UE - European Bank for Reconstruction & Development, African Development Bank, Asian Development Bank, Pacific Islands - Most Wanted Fugitives, European Union - Consolidated list of sanctions, Interpol.   European Union  Europol: Europe Most Wanted.   France  Assurance Banque d'Epargne (Sites internet et Entités non autorisés), Registre des gels des avoirs (Consolidated with UN), Gel national des avoirs.   Germany  German Federal Criminal Police, German Police - Most Wanted.   Italy  Polizia Criminale Most Wanted, Banca d'Italia - Eurosistema (Sanction measures). Luxembourg  Most Wanted by Luxembourg Police, Ministry of Finance - Persons/Entities/Organizations targeted in implementation of the resolutions adopted by the UN.   Malta  Court of Magistrates / FIAU.   Netherlands  The Netherlands National Wanted List, Rijksoverheid.   Norway Norwegian Black List.   Russian Federation  Rosfin Monitoring Russia, Russian individuals, Russian Entities, Non-Russian organisations, Non Russian individuals, The Central Bank of the Russian Federation, Revoked licenses of professional securities market participants, Suspended licenses of professional securities market participants, Detected cases of the misuse of insider information and market manipulation (Market Abuse), Organizations and individuals involved in the proliferation of weapons of mass destruction, Individuals / Entities subject to special economic measures.   Singapore  Monetary authorities Singapore, Singapore Government TSOFA is direct link to United Nations. Switzerland  Sanctions & Embargos - SECO.   United Arab Emirates  Groups designated terrorist organisations by the UAE.   United Kingdom  United Kingdom HM Treasury Consolidated, Most Wanted of United Kingdom - National Crime Agency (NCA).   United States  FBI, U. S. Food & Drug Administration, US Marshalls, Denied persons list, Unverified list, Entity list, Non proliferation, Debarred parties, Penalty & Oversight Agreements, Diplomatic Security Service (DSS) Most wanted, Department of Treasury FinCEN, Dpt. Homeland Security-Immigration & Customs, US Drug Enforcement Administration, Commodity Futures Trading Commission "RED list", Terrorist Exclusion List, Bureau of ATF, Executive Office for Immigration Review, Inter American Development Bank, Financial Crime Enforcement Network - 311 Special Measures, Air Force's Most Wanted Fugitives, US Army's Most Wanted Fugitives, U. S. Coast Guard (Department of Homeland Security) Port State Control Division, Naval Criminal Investigative Service (Most Wanted), U. S. Securities and Exchange Commission - FCPA Cases, OFAC-SDN, FSE (OFAC Consolidated: FSE, SSI, Palestinians, Non-SDN, ... ).   Ukraine  Financial Monitoring Service (Same as United Nations), National Security and Defence Council of Ukraine - Individuals, National Security and Defence Council of Ukraine - Entities.   --- ### Security and Compliance > Security and compliance are essential to our mission to ensure our clients' sensitive data are protected. ISO 27001 certified. GDPR compliant. - Published: 2021-01-04 - Modified: 2025-01-20 - URL: https://www.idenfy.com/security/ Our Mission At iDenfy, security and compliance are essential to our mission to ensure our clients' sensitive data are protected. To accomplish this mission, we adopted best practices designed to mitigate risks to protect against unauthorized access to information. SOC2 Standards iDenfy has been audited and certified for SOC2 certification by the House of CPA. The audit is performed every 12 months. ISO Standards iDenfy has been audited and certified by TÜV Thüringen to ISO 27001 under certificate number TIC 1512120135 on 2020-03. The audit is performed every 12 months by TÜV Thüringen. GDPR Compliance iDenfy is fully GDPR compliant. More detailed information can be found in our Privacy Policy. eIDAS Requirements and ETSI standards iDenfy is a Trust Service Provider under eIDAS regulation. This repository also contains the documentation required by applicable eIDAS requirements and ETSI standards. iDenfy TRA Service performs remote unattended identity proofing using hybrid manual and automated operation. Documents in force NameVersionDate publishedValid fromPractice Statement1. 0. 02023-03-122023-03-12Terms and Conditions1. 0. 02023-03-122023-03-12Terms and Conditions (Romanian)1. 0. 02023-03-122023-03-12 iDenfy Trust Service NamePractice StatementTerms and Conditions iDenfy Insurance NameInsurance Certificate iDenfy Certification NameISO 27001 Certificate (2023)ISO 27001 Certificate (2022)ISO 27001 Certificate (2021)ISO 27001 Certificate (2020) Third-party Registers The registers are used in these countries during the identification procedure in the iDenfy Trust Service to verify the validity of the documents. NameCountryLost / Stolen Document RegisterLithuaniaNo registriesRomania Incidents and status Real-time status and incidents can be viewed and subscribed to via the iDenfy status page. Changes and updates Updated security documents will be published and notified via www. idenfy. com/security/ repository and by email to subscribers, customers, and supervisory bodies. History and previous versions DateName2023-06-02Added ISO 27001 certificate of 2023 --- ### AML Compliance > AML Compliance : Achieve anti-money laundering AML compliance for online customer identity verification. Meet KYC, AML & GDPR regulations. - Published: 2020-12-07 - Modified: 2021-01-22 - URL: https://www.idenfy.com/aml-compliance/ Also, know as Anti-money laundering. It’s been hitting the headlines of the news recently. A major financial worldwide problem. Regulation has never been stricter and businesses face ever-increasing pressure from government authorities. That’s why AML is part of our product: to assist businesses to achieve AML compliance. What is Anti-money laundering? Anti-money laundering refers to a set of laws, regulations, and procedures intended to prevent criminals from disguising illegally obtained funds as legitimate income. Though anti-money-laundering (AML) laws cover a relatively limited range of transactions and criminal behaviors, their implications are far-reaching. For example, AML regulations require that banks and other financial institutions that issue a credit or allow customers to open deposit accounts follow rules to ensure they are not aiding in money-laundering. How we help businesses meet AML compliance regulation We check government and Interpol databases to ensure a person is legit to proceed with financial operations. Did I mention instant and automatic? Yes, it all happens in a blink of an eye, allowing you to scale your operations. So to comply with AML and KYC regulations, we check the following databases: Sanctions (EU, UN, OFAC, SECO, HM Treasury)Politically exposed person listInterpol database Lost and stolen documentsFinancial crime All collected information is returned to you via API key and allows your Compliances officer to make an accurate decision, meet due diligence requirements, and comply with regulatory directives. 💡Key facts “The estimated amount of money laundered globally in one year is 2 – 5% of global GDP, or $800 billion – $2 trillion in current US dollars. Though the margin between those figures is huge, even the lower estimate underlines the seriousness of the problem governments has pledged to address. ” – united nations office. Read more about "what is know your customer" or KYC regulation? --- ### Supported Documents > Thousands documents accepted for identity verification from over 200 countries and territories. Passport, driving licence, identity card. - Published: 2020-12-03 - Modified: 2023-03-27 - URL: https://www.idenfy.com/supported-documents/ --- ### Book a Free Demo > Get a personalized free demo on how iDenfy can benefit you with identity verification and fraud prevention service. - Published: 2020-12-02 - Modified: 2024-08-01 - URL: https://www.idenfy.com/book-a-meeting/ --- ### Book a Free Demo > Get a personalized free demo on how iDenfy can benefit you with identity verification and fraud prevention service. - Published: 2020-12-02 - Modified: 2024-08-01 - URL: https://www.idenfy.com/book-a-meeting/ --- ### WHAT IS KYC? > What is Know Your Customer? KYC refers to a process verifying the identity of your customers. How to meet KYC compliance in digital enviroment? - Published: 2020-12-01 - Modified: 2022-11-30 - URL: https://www.idenfy.com/know-your-customer/ What is KYC? For anyone who is not familiar with this acronym – Know your customer regulation. How well do you know your customers and are you sure that they are not linked with any criminal or fraudulent activity? Know Your Customer refers to a process verifying the identity of your customers, be it beforehand doing business with them or during. What is it for? KYC regulation has been introduced to manage and tackle several very important threats in modern society, such as money laundering, corruption, terrorist funding or other illegal activities. Yeah, we know... all of these sounds pretty serious. Know Your Customer compliance is a rather simple process while done in “real life”. All you have to do is verify if that person is real and has a legally valid document. People have done it everywhere, when they went to the bank and opened an account or done any financial operations, interacting with government authorities, even when checking into a hotel or renting a flat. KYC compliance is widely applied around the globe. And while it was technical it was also rather simple when you have a person present. Simply checking if a person match with his ID was enough. But what happens when you never “see” your customers? When businesses moved into a digital environment, KYC compliance became a bit more difficult and the rise of the eKYC concept became more and more present. So what is eKYC? eKYC is a diligence process where you ensure that your business stays compliant with the legal framework and regulations on anti-money laundering in the digital environment. To do that you will need a trusted identity verification provider like us. How we can help? Employing AI-powered technical solutions alongside computer vision technology we help businesses to stay fully compliant with KYC regulations. Not only that, we made sure this process is user-friendly, quick to integrate and reliable. In other words, we got your back. Contact us to learn more. --- ### Developers > API and SDK integration documentation, tutorials. Integrate identity verification and fraud prevention service from iDenfy. - Published: 2020-12-01 - Modified: 2020-12-08 - URL: https://www.idenfy.com/developers/ Well done! We know, the legal bit is important and not always as straight forward as everyone wants it to be. You managed it like a true pro, huge kudos for that, now we can move to the fun part – Integration. Let’s get started!  Right, here you will find everything you need for our solution integration. To start using our API you will need two things – API key and API secret. You can get both by contacting our team. Complete documentation can be found in GitHub repository Generate an identification token A token is used to identify your client with our services Read in GitHub Client redirection Redirect a client to our web or mobile platforms Redirection to WEB platform Redirection to WEB platform (iFrame) Receive callback Set a callback URL (to setup contact iDenfy team) to receive identification results Receive identification result callback Mobile SDK If you have your own mobile application, you can integrate iDenfy directly in your mobile application Mobile Android SDK Mobile iOS SDK User interface customisation Customize iDenfy platform to your brand WEB UI platform customisation Android SDK Customisation iOS SDK Customisation Security Data safety is very important, here you will find how you can add extra security Callback signing IP white-listing Extra Vocabulary API Error messages --- ### > Create account and start using identity verification service, prevent fraud, comply with know your customer rules. - Published: 2020-07-29 - Modified: 2024-06-21 - URL: https://www.idenfy.com/get-started/ iDenfy Ranked #1 ID verification solution for business in G2 Crowd (function { var on = window. addEventListener ? function (m,c) { window. addEventListener(m,c,false); } : function (m,c) { window. attachEvent('on'+m,c); } , r = function (e) { if (e. origin ! == "https://my. g2. com") { return; } var d = document. getElementById('g2-crowd-widget-testimonial-1051183'); if(d){d. style. height = e. data}; r = function {}; } ; on('message', r); }); iDenfy reviews sourced by G2 hbspt. forms. create({ portalId: "6082545", formId: "3e5c4d0d-baf2-48fb-af95-a34d747a83e7", onFormSubmit: function($form) { gtag('event', 'Goal-Form-Submission', { 'event_category' : 'Hubspot' }); } }); --- ### Identity Verification for Sharing Economy > Identity verification in the sharing economy industry. Prevent fraud, ensure customers' safety, build credibility. - Published: 2020-07-29 - Modified: 2025-04-14 - URL: https://www.idenfy.com/sharing-economy/ The new hot topic (Sharing Economy). Opportunities it brought are infinite. Reshaping not only the way we commute, borrow or even sleep (that is life. . ). While it opens doors to new market possibilities, it also brought a lot more risk. Fraud Protection for Sharing Economy On-boarding customers remotely while managing risks involved with identity theft is not an easy challenge. That’s why we developed a product that suits exactly those needs, from seamless integration to rigorous AI-powered screenings helping your business to scale at a peace of mind --- ### Identity Verification in Online Gaming > Identity verification for Online Casino, Gambling sites. Prevent fraud and ensure safety with automated identity verification. - Published: 2020-07-29 - Modified: 2022-03-04 - URL: https://www.idenfy.com/online-gaming/ Fighting Online Gaming Fraud with Identity Verification The increase in Internet usage and easy access to online casino gaming platforms is driving the market growth. The global reach has facilitated financial crime and fraud on account of the diversity of patrons and the high volume of cross-border transactions. Unchecked money laundering and fraud can have far-reaching economic consequences, and the online gaming industry is one of the latest to come under regulatory compliance. About this report Exposed to risks Gaming and gambling industries have always been centers of financial crime. In most countries, the gaming sector remains unregulated, making them channels of money laundering and illicit funding. It is in recent years when the gaming and gambling industry shifted online, that the risk exposure of the platforms increased significantly as online gaming can be accessed by players from any location over the Internet. Learn more Many challenges The online gaming industry is exposed to high risks of financial crime. Some of the common challenges faced by the gaming and gambling industry are identity theft, credit card fraud, document forgery, money laundering, and other cyber incidents. Crime can occur at any point along the service lifecycle. The use of mobile devices to monetize stolen credentials is the most common method, with cyberattacks on mobile payments occurring more than other transactions. The customer is also vulnerable to larceny and identity theft via his networked mobile device. Learn more The changing scenery The spread of the pandemic and enforced home isolation has accelerated the demand for online gaming. People increasingly use smartphones to place bets and access accounts online. With the number of gamers increasing every day, the industry became one of the most exposed sectors to newer fraud types, such as synthetic identity fraud, spoofing, and transaction scams. Criminals exploit security gaps at the point of customer authentication to commit fraud and evade economic or trade sanctions. They are known to falsify information, make use of stolen identities, or abuse the network for financial manipulation. Learn more --- ### Identity Verification for Electronic Money Institutions > Know your customer (KYC) & Anti-money laundering (AML) compliance is one of the essential requirements for your EMI license. - Published: 2020-07-29 - Modified: 2025-04-14 - URL: https://www.idenfy.com/electronic-money-institution/ Currently, we provide identity verification service for over 30 Electronic money institutions, not only that, we closely work with Lithuanian bank (LB) and help companies navigate the application process. But first, let’s cover: “what is electronic money institution and what they do? ” before we dig deeper into how we help these companies. Electronic money institutions are market participants with a right to issue electronic money. Electronic money (e-money) is a pre-paid monetary value issued into circulation by an electronic money institution, held on electronic devices and used for payment purposes. To have a right to issue Electronic money, companies need to receive an electronic money institution license also known as EMI. Electronic money institutions license in Lithuanian 2018-2019 has been a phenomenal success for Lithuania. Lithuanian central bank has granted over 50 new EMI licenses, including Fintech disrupters as Revolut. This has officially positioned the country as a FintechHub in financial Europe. Not only that but Lithuanian bank has been working to provide an extremely efficient application process, that helps businesses receive EMI licenses in efficient timelines. Opening doors for further Fintech expansion in Europe. While the application process is streamlined and effective, regulation is still strict. Compliance still remains as one of the most important focus for EMI license holders. KYC & AML compliance As a trusted provider and partner of LB, we will help you navigate the difficult compliance requirements and get approved in a fast and efficient way, delivering trusted and tested KYC/AML solutions. Know your customer (KYC) & Anti-money laundering (AML) compliance is one of the essential requirements for your EMI license. It’s paramount to choose a provider that is trusted & works closely with local authorities, yet provides you capabilities to scale and grow. iDenfy has been helping businesses since 2016 to comply with EMI license requirements, offering online identity verification solutions to meet regulations and effectively grow. Not quite convinced? Here’s “the cherry on the cake” we have partnered with +30 different EMI license “go-getters”, just like you. --- ### Identity Verification for Digital Wallets > Identity verification for electronic wallets, digital payments. Verify customers' identities, prevent fraud, ensure safety. - Published: 2020-07-28 - Modified: 2025-04-14 - URL: https://www.idenfy.com/digital-wallets/ Digital wallets are just simply great. Not only they help you be efficient in your daily life it also grants you freedom. From making a payment using NFC technologies to Verifying user’s age. Use cases are abundant. What is a digital wallet? A digital wallet is a system that securely stores users’ payment information and passwords for numerous payment methods and websites. By using a digital wallet, users can complete purchases easily and quickly with near-field communications technology (NFC). They can also create stronger passwords without worrying about whether they will be able to remember them later. As information provided on investopedia This allows your customers to proceed with payments quick and efficient while being less worried about potential fraud. Resulting in great user experience. Digital wallets have seen a rise in the last few years as user demand for fast and simple payment solutions has been on rising. Mobile payments & Digital Wallets Combined technologies allow users to complete a purchase from their mobile device. Digital wallet empowered by mobile payment solutions helps clients to pay for their goods with a quick tap. This further increases user satisfaction for speed and efficiency, driving your business further and building a relationship with your customer. Additionally, businesses can build engagement with their clients. By building a communication channel that will help increase loyalty and prolong lifetime value (LTV) of the customer, making them regular users of services. It also allows offering tailored made offers based on a user’s individual use of services further increasing the relationship between user and business. It’s a win-win scenario. Customers can benefit from speedier, safer transactions and more tailor-made offers to meet their needs, and businesses can increase their loyalty, prolong LTV and measure more accurately what works better for their customers. Identity Verification in Digital Wallets While Digital wallets offer great benefits to both sides – users and businesses, it also has some challenges. Companies that want to scale their operations using digital wallets, need to comply with basic Know Your Customer processes. Remote user onboarding means you need to identify your customers that will be using your services. Some sort of customer due diligence (CDD) processes needs to be implemented. And it can be tricky. Building legal compliance departments is not easy, but also can quickly become expensive and inefficient. To meet KYC/CDD standards you will have to conduct user verification. iDenfy solution helps Digital wallet / Mobile payment providers to meet those compliances by conducting online identity verification and helping to comply with KYC, AML & GDPR regulations. --- ### Contactaţi-ne > Contactați serviciul de verificare a identității iDenfy folosind e-mail, telefon sau poștă. - Published: 2020-07-27 - Modified: 2023-06-21 - URL: https://www.idenfy.com/contactati-ne/ Hai să vorbim Este întotdeauna mai bine să vorbim cu o persoană reală. Hai să ne cunoaștem mai bine și să vedem cum ne putem ajuta. Avem nevoie doar de câteva detalii despre tine și despre metoda preferată de comunicare. Așa că completează un formular și promitem să vă răspundem, cât mai curând posibil. . ! hbspt. forms. create({ portalId: "6082545", formId: "78f5ceb7-c1ce-4682-81ec-34e4a352c502", onFormSubmit: function($form) { gtag('event', 'Goal-Form-Submission', { 'event_category' : 'Hubspot' }); } }); --- ### > Contact iDenfy's technical support, customer support or sales department. Send us a message here and we'll get back to you. - Published: 2020-07-27 - Modified: 2024-12-10 - URL: https://www.idenfy.com/contact-us/ Locations United States iDenfy LLC8 The Green, Suite A Dover, 19901United States(+1) 207 4016220 United Kingdom iDenfy LTD71-75 Shelton Street London, WC2H 9JQUnited Kingdom(+44) 744 1443847 Lithuania iDenfy UABBarsausko 59Kaunas, 51423Lithuania(+370) 640 844 66 Connect with an Expert Discover how we can help you prevent fraud, meet global compliance standards, and lower customer acquisition costs. Need help with verification? Do you have complaints, disputes, or questions about your identity verification? Contact the support team. Report abuse? Need to report abuse or suspicious activity? Contact the security team. hbspt. forms. create({ portalId: "6082545", formId: "78f5ceb7-c1ce-4682-81ec-34e4a352c502", onFormSubmit: function($form) { gtag('event', 'Goal-Form-Submission', { 'event_category' : 'Hubspot' }); } }); --- ### Pricing > Price for online identity verification, ID check, anti-money laundering, and know your customer service. Verify identity online. - Published: 2020-07-23 - Modified: 2025-04-06 - URL: https://www.idenfy.com/identity-verification-price/ --- ### Cookie policy > This site uses cookies, which are tiny files that are downloaded to your computer, to improve your user experience in our website. - Published: 2020-07-19 - Modified: 2021-01-08 - URL: https://www.idenfy.com/cookie-policy/ This is the Cookie Policy for iDenfy, accessible from www. idenfy. com What Are Cookies As is common practice with almost all professional websites this site uses cookies, which are tiny files that are downloaded to your computer, to improve your experience. This page describes what information they gather, how we use it and why we sometimes need to store these cookies. We will also share how you can prevent these cookies from being stored however this may downgrade or 'break' certain elements of the site's functionality. For more general information on cookies see the Wikipedia article on HTTP Cookies. How We Use Cookies We use cookies for a variety of reasons detailed below. Unfortunately, in most cases, there are no industry standard options for disabling cookies without completely disabling the functionality and features they add to this site. It is recommended that you leave on all cookies if you are not sure whether you need them or not in case they are used to provide a service that you use. Disabling Cookies You can prevent the setting of cookies by adjusting the settings on your browser (see your browser Help for how to do this). Be aware that disabling cookies will affect the functionality of this and many other websites that you visit. Disabling cookies will usually result in also disabling certain functionality and features of this site. Therefore it is recommended that you do not disable cookies. The Cookies We Set Forms related cookies when you submit data through a form such as those found on contact pages or comment forms cookies may be set to remember your user details for future correspondence. Site preferences cookies in order to provide you with a great experience on this site, we provide the functionality to set your preferences for how this site runs when you use it. In order to remember your preferences, we need to set cookies so that this information can be called whenever you interact with a page that is affected by your preferences. Statistic and marketing cookies for statistics, marketing, and remarketing purposes. Necessary Cookies This site uses cookies that are necessary to deliver content and service. Third-Party Cookies In some special cases, we also use cookies provided by trusted third parties. This site uses Google Analytics which is one of the most widespread and trusted analytics solutions on the web for helping us to understand how you use the site and ways that we can improve your experience. These cookies may track things such as how long you spend on the site and the pages that you visit so we can continue to produce engaging content. For more information on Google Analytics cookies, see the official Google Analytics page. This site uses social media buttons and/or plugins on this site that allow you to connect with your social network in various ways. This site uses HubSpot cookies to track website visitors and contacts. For more information, see the official HubSpot page. This site uses Linkedin... --- ### Privacy policy > Data protection is our top priority. Learn more how we process and manage data such as the name, address, e-mail address, or telephone number - Published: 2020-07-19 - Modified: 2024-10-01 - URL: https://www.idenfy.com/privacy-policy/ We are very delighted that you have shown interest in our enterprise. Data protection is of a particularly high priority for the management of the UAB “iDenfy”. The use of the Internet pages of the UAB “iDenfy” is possible without any indication of personal data; however, if a data subject wants to use special enterprise services via our website, processing of personal data could become necessary. If the processing of personal data is necessary and there is no statutory basis for such processing, we generally obtain consent from the data subject. The processing of personal data, such as the name, address, e-mail address, or telephone number of a data subject shall always be in line with the General Data Protection Regulation (GDPR), and in accordance with the country-specific data protection regulations applicable to the UAB “iDenfy”. By means of this data protection declaration, our enterprise would like to inform the general public of the nature, scope, and purpose of the personal data we collect, use and process. Furthermore, data subjects are informed, by means of this data protection declaration, of the rights to which they are entitled. As the processor, the UAB “iDenfy” has implemented numerous technical and organizational measures to ensure the most complete protection of personal data processed through this website. However, Internet-based data transmissions may in principle have security gaps, so absolute protection may not be guaranteed. For this reason, every data subject is free to transfer personal data to us via alternative means, e. g. by telephone and to take personal responsibility to ensure transferred data safety. 1. Definitions The data protection declaration of the UAB “iDenfy” is based on the terms used by the European legislator for the adoption of the General Data Protection Regulation (GDPR) 2016/679. Our data protection declaration should be legible and understandable for the general public, as well as our customers and business partners. To ensure this, we would like to first explain the terminology used. In this data protection declaration, we use, inter alia, the following terms: Personal data – Personal data means any information relating to an identified or identifiable natural person (“data subject”). An identifiable natural person is one who can be identified, directly or indirectly, in particular by reference to an identifier such as a name, an identification number, location data, an online identifier or to one or more factors specific to the physical, physiological, genetic, mental, economic, cultural or social identity of that natural person. Data subject – Data subject is any identified or identifiable natural person, whose personal data is processed by the controller responsible for the processing. Processing – Processing is any operation or set of operations that are performed on personal data or on sets of personal data, whether or not by automated means, such as collection, recording, organization, structuring, storage, adaptation or alteration, retrieval, consultation, use, disclosure by transmission, dissemination or otherwise making available, alignment or combination, restriction, erasure or destruction. Restriction of processing – Restriction of processing is the marking of stored personal data with the aim... --- ### Newsroom > All the latest news and coverage from iDenfy. Read press releases, latest awards and achievements, download the media kit. - Published: 2020-07-19 - Modified: 2022-11-15 - URL: https://www.idenfy.com/press-media/ iDenfy's latest news. For more information about the company, logos, and product visuals, feel free to download a media kit here. Please contact press@idenfy. com for any press enquiries. Partnership announcements elink. io | See Original Press releases elink. io | See Original --- ### Partner program > Partner and affiliate program in identity verification and fraud prevention sector. Earn more and build safer tomorrow. - Published: 2020-07-19 - Modified: 2025-05-20 - URL: https://www.idenfy.com/partner-program/ --- ### Blog > Identity verification, Know Your Customer, Anti Money Laundering and fraud prevention stories, tutorials, and discussions. - Published: 2020-04-23 - Modified: 2023-02-17 - URL: https://www.idenfy.com/resources/ --- --- ## Posts ### The Guide to KYB Onboarding  > Learn about the KYB onboarding: what it is, why it matters, best practices, and other features for compliance and fraud prevention. - Published: 2025-05-15 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/the-guide-to-kyb-onboarding/ - Categories: Blog, KYB/AML Knowing KYB onboarding is important for businesses. Walk with us through the essentials of KYB, all the way from compliance and risk management to automation and user experience. The digital economy is facing some challenges that include fraud, money laundering, identity theft, embezzlement, and other forms of digital criminal activity. Although a small organization is more likely to get this kind of attack, it does not matter, because even banks, SaaS platforms, and major companies have a risk of getting affected by fraud, and that is exactly why you need a proper Know Your Business (KYB) solution and its onboarding process guide.   We will talk about everything you need to know about KYB onboarding: what it is, why it matters, how it works, etc. , all for creating a seamless, compliant onboarding experience.   What is KYB Onboarding?   KYB onboarding process is the thing that verifies the identity, legitimacy, and risk level of a business before establishing any relationships with them, whether it is a financial or commercial one. Although KYB differs from KYC (Know Your Customer), which mainly focuses on individuals, KYB targets organizations, companies, partnerships, and other business structures.   The main purpose of KYB is to ensure that a business:  Is legally registered and operational  Has verifiable beneficial owners (UBOs)  Is not engaged in money laundering, fraud, or terrorism financing  Complies with relevant regulatory frameworks like AML (Anti-Money Laundering), CTF (Counter-Terrorist Financing), and GDPR  KYB onboarding is mainly monitored by financial regulators in many regions, for example, FinCEN for U. S. businesses, FCA for UK businesses, MAS for Singapore, and the EU’s 5th and 6th AML Directives.   Why is KYB Important?   Many people know that they need to implement KYB into their organizations, but sometimes they forget why it is important.   Regulatory Compliance  Let’s start with regulatory compliance. Financial institutions and various other regulated organizations are legally required to conduct due diligence on the businesses. Non-compliance can lead to fines and reputational damage.   Fraud Prevention  KYB helps a lot with detecting fake companies, corporations, and organizations, reducing the chances of getting involved in fraud and illegal activities.   Risk Assessment  Through KYB, businesses can assess the financial and reputational risks of taking a new corporate client, verifying and reviewing the ownership structures, business activities, and past sanctions.   Trust and Transparency  The most important factor of KYB implementation is trust between businesses. By verifying a company’s legitimacy, platforms and partners signal that they are serious about ethical and secure collaboration.   What Does the KYB Onboarding Process Involve?   The main Onboarding KYB Processes typically include several key steps: Collecting Business Information:  Legal company name  Company registration number  Incorporation documents  Registered address  Tax identification number  Business type and industry  Identifying Ultimate Beneficial Owners (UBOs)  A UBO is a person who owns or controls more than a certain percentage of the business (usually 25%). Verification of UBOs involves:  Government-issued ID  Proof of address  Date of birth  Ownership percentage  Sanctions and Watchlist Screening  This step checks whether the business or its stakeholders appear on sanctions lists, politically exposed persons (PEP) databases, or media reports.   Document Verification  Manual reviews and automated... --- ### Fraud Detection Using AI in Banking > Fraud detection - banks' need it. Check out the blog post about how fraud detection using AI could be used in banking. - Published: 2025-05-06 - Modified: 2025-05-12 - URL: https://www.idenfy.com/blog/fraud-detection-using-ai-in-banking/ - Categories: Blog Traditional fraud detection methods are not enough, especially for banks. Learn how Artificial Intelligence (AI) is improving fraud detection in banking, together with real-time insights and strong user protection. The financial world is changing, and it is not the same as it was yesterday, so yes, we could say that it is changing every day. On one hand, technology has allowed banks to process millions of transactions every day at lightning speed; on the other, it has exposed them to various fraud risks, which is why banks need fraud detection tools. Synthetic identity fraud and phishing scams mean that fraudsters are using various tactics and technologies to bypass banking systems and their security measures just to profit. For banks, it is a lot more than just a financial issue. It is a matter of trust as well.   AI is powerful against fraud. Its ability to learn from data, identify patterns, and make real-time decisions allows financial institutions to keep user accounts secure.   Why Traditional Systems No Longer Work  Traditional fraud detection methods almost always rely heavily on rules and manual processes, like:  Transactions over a certain amount might trigger alerts.   Transfers from specific locations could also be alerted to the team.   Known blacklisted accounts or IPs are automatically blocked.   Well, yes, you can say that these rules offer protection against fraud, but it is not as effective as AI could be, because these traditional rules almost always run short when fraudsters decide to change their tactics.   The thing with these traditional methods is that they can not adapt in real-time, which often results in a high number of false positives, and they can not keep up with the volume of today’s digital banking activity.   Consider The Implementation of AI  If you are still using traditional systems as your primary security for the bank, well, we hate to break it to you, but the bank could be in real danger. AI brings something that traditional systems lack: adaptability.   Instead of depending on predefined rules, AI systems learn what constitutes “normal” behavior and continuously update their understanding as new data comes in. When something deviates from the norm, the system flags it, and then the human agent takes over for the investigation of the issue that occurred.   AI does this:  Real-Time Monitoring: AI can analyze thousands and thousands of transactions in minutes, and if any unusual activity or transaction occurs, it instantly gets alerted to the human team.   Pattern Recognition: Machine learning models can identify simple and complex patterns that humans or traditional software would just simply miss.   Behavioral Analysis: AI systems track user behavior, such as login patterns and device usage. Additionally, mouse movement and typing speed can also be monitored. Sudden changes could indicate fraud.   Main Technologies That Are Used in Fraud Detection (AI)  There is not just one type of AI. Several technologies work together to make fraud detection way smarter and faster:  Machine Learning (ML): ML algorithms can learn from historical data, which makes it perfect for learning new fraud tactics. The more data they analyze, the better they become at identifying fraudulent patterns. This... --- ### AML Case Management [Detailed Guide] > Look through the key steps of AML case management and learn how to simplify AML tasks for AML compliance analysts using automation. - Published: 2025-05-02 - Modified: 2025-05-05 - URL: https://www.idenfy.com/blog/aml-case-management/ - Categories: Blog, KYB/AML Learn how AML case management works and which AML processes or key components go into this centralized system, helping analysts monitor transactions, log extra cases, and analyze identified red flags, sometimes leading to complex cases, especially when limited AML automation is used. Find out why. Regulated industries, such as banks, credit unions, real estate agencies, luxury item resellers, crypto platforms, iGaming operators, and other high-risk sectors where chances of financial crime are higher, need to implement strict anti-money laundering (AML) measures. While this doesn’t seem like a big challenge to some, many still don’t know the scope of modern money laundering. Millions of fines are placed for reputable banks and financial institutions that fail to have proper AML case management programs.   To comply with AML rules, companies need to implement measures to detect, assess, and report suspicious activity. These activities can range from unusual customer behavior to transactions originating from high-risk, corruption-prone countries. That, once again, shows the importance of bringing all your efforts to actually detect AML risks and shady individuals who use legitimate financial systems to clean dirty cash.   Below, we explain how to use a systematic approach to AML case management and why this component of an entity’s AML program is vital to better detect critical issues while preventing money laundering activities.   What is AML Case Management? AML case management is a structured system management technique that’s designed to help companies track and improve their internal anti-money laundering compliance processes. Ultimately, AML case management helps companies track, investigate, and report suspicious activities that are potentially linked to financial crime and money laundering.   AML case management consists of processes like: Investigating unusual customer behavior Identifying high-risk customers or their transactions Profiling customers determining their risk level  Managing specific use cases Reporting suspicious activity to relevant regulatory authorities Conducting ongoing monitoring  AML case management plays a key role in a company’s AML compliance program, offering a clear framework for handling specific use cases accurately and efficiently — from the initial alert or AML hit to escalation and resolution.   This helps internal compliance teams dedicate their time and resources to more complex cases while streamlining and automating more simple AML-related tasks that don’t require that much manual intervention.   What are the Components of AML Case Management? There are several elements that typically go into an AML case management system: Transaction Monitoring  Transaction monitoring is an ongoing process that involves constantly screening and looking through incoming and outgoing transactions, including processed transactions, to identify potential threats, signs of fraud, and suspicious activity. By analyzing both historical and real-time customer data, this process in AML case management helps build a more accurate customer risk profile. Effective monitoring relies on accurate data collection to detect and manage threats proactively. Transaction monitoring helps identify the risks of: Money laundering Terrorism financing  Sanctions violations Other illicit activities If suspicious activity is detected during transaction monitoring, the company needs to gather all transaction details and submit a Suspicious Activity Report (SAR) to the appropriate regulatory authority within the required timeframe. Related: AML Fraud — Types and Detection Measures Alert Management  Alert management in AML involves handling suspicious activity alerts, which are often provided by AI-powered fraud prevention systems that use special algorithms to detect atypical... --- ### How to Prepare Business Formation Documents > Learn the key types of business formation documents, and how to start your business operations legally in the US while complying with KYB. - Published: 2025-04-28 - Modified: 2025-05-07 - URL: https://www.idenfy.com/blog/business-formation-documents/ - Categories: Blog, KYB/AML Learn how to retrieve business formation documents, what types of documents you need for different business structures, and where to easily find them online. Starting your own business means there will be a lot of paperwork. Without business formation documents, such as operating agreements, companies can’t legally operate. That’s why it’s crucial to define your business structure and know the exact steps that are needed to both protect your company’s interests and comply with legal requirements. The main challenge is that getting business formation documents can feel overwhelming. You need to define leadership roles, secure the right permits and licenses, and file everything with the appropriate government authority. But that’s just the beginning.   The documents you need depend on your business structure and the state where you're operating. Different entities, such as sole proprietorships, might require less documentation, depending on the business structure. Additionally, most companies will ask for business formation documents as proof to check if another company is legitimate. This is also part of the Know Your Business (KYB) compliance process, which helps organizations ensure the business isn’t involved in financial crime and is a trustworthy partner when working with vendors, suppliers, etc. Tag along and learn the exact document types needed for concrete business structures, and how to access and get the right business formation documents for compliance and secure B2B relationships.   What are Business Formation Documents? Business formation documents are mandatory paperwork that an entity must file with a government agency before it can legally start its operations as a new business. This process requires several steps, such as choosing the type of business entity you're forming, selecting a name for your business, and submitting the required documents to the state’s Secretary of State office. Business formation documents are important because they: Help define the groundwork for the business Lay out the ownership structure and management responsibilities  Provide liability protection for the company’s owners Detail the entity’s purpose and other details about the business These documents are also required for tax reporting purposes and in other cases, for example, when the business needs to open a business bank account. Common examples of business formation documents include Articles of Incorporation or an LLC operating agreement. Keep in mind that specific files depend on the type of business and its operating state.   What are the Key Business Structures? The main types of business entities in the US include the following categories: Partnerships Sole proprietorships Limited liability companies (LLCs) Limited partnerships Limited liability limited partnerships (LLLPs) General partnerships (GPs) Nonprofit corporations Corporations (S Corp / C Corp)  Benefit corporations (B Corp) For example, corporations are required to file corporate bylaws, which define how the business is managed, including the responsibilities of shareholders and directors. In contrast, LLCs and partnerships use an operating agreement to outline ownership structure, management roles, profit distribution, and how disputes are handled. However, there are multiple documents that companies need to get before starting to operate legally. For instance, a shareholder agreement is a separate business formation document that defines shareholder rights and responsibilities that are not covered in the corporate bylaws. Why Do You Need... --- ### A Guide for Compliance Officers - Top Interview Questions in 2025  > Prepare for your compliance officer interview with expert tips, various interesting questions, and real-world advice to stand out. - Published: 2025-04-24 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/a-guide-for-compliance-officers/ - Categories: Blog Organizations are always seeking professionals who understand complex laws and are able to apply them across hybrid work environments, but sometimes there can be issues - it could be hard to prepare for an interview for a compliance officer. Learn how you can ace the interview. The compliance officer role has become increasingly essential for businesses all around the world. As they are striving to walk complex legal frameworks, the demand for skilled compliance professionals continues to rise. Let's talk about top interview questions for compliance officers - one of the most important roles in the business.   The Role of a Compliance Officer  First, we need to understand what a compliance officer is and what they do before we can discuss the top questions asked by interviewers to compliance officers. Think like this - it is a role that ensures that an organization adheres to external laws and policies, preventing legal violations and promoting ethical standards by conducting risk assessment and various monitoring. For them, it is not really an easy job, as they have to be adaptable and detail-oriented and possess strong analytical skills.   The regulatory changes are becoming frequent, so compliance officers must maintain a company’s integrity and legal standing, responsible for ensuring that employees understand and follow industry regulations and maintaining transparent communication with stakeholders.   Top Interview Questions for Compliance Officers in 2025  Interviewers want to know technical knowledge and behavioral competencies. Below are the most common questions that candidates might encounter during the interview.   How do you stay updated with changing compliance regulations?   Why was this question asked?   With this question, employees seek candidates who monitor and adapt to the changing regulations.   How to Prepare for the Question:  Discuss the strategies about how you are staying informed; maybe you are subscribed to various industry publications, maybe you attend seminars or participate in professional networks and utilize compliance management platforms that offer real-time updates - just tell them how are you staying updated with the trends. Organizations value professionals who are active about regulatory changes.   Can you provide an example of a compliance challenge you faced and how you addressed it?   Why was this question asked?   This question helps employers to get to know your abilities when it comes to solving problems and practical experiences.   How to Prepare for the Question:  There is one method that you could use, and it is working pretty well actually - the STAR method - Situation, Task, Action, Result to structure your response. You could provide a specific scenario that happened, what did you do then, and what was the outcome. Also communicate effectively and add an example that demonstrates your ability to think critically.   How do you handle conflicts between compliance requirements and business objectives?   Why was this question asked?   To balance regulatory compliance with business goals is a very common challenge that must be addressed.   How to Prepare for the Question:  Tell them that you have the ability to collaborate with other departments to find solutions that satisfy compliance standards without affecting business operations, because demonstrating a business-minded approach and maintaining compliance integrity can set you apart from other candidates. Show that you understand the balance between risk management and... --- ### What is a Magic Link and How Does it Work? > Explore the topic of the Magic Link: how it's related to application security, authentication and identity verification in KYC compliance. - Published: 2025-04-24 - Modified: 2025-05-14 - URL: https://www.idenfy.com/blog/what-is-a-magic-link/ - Categories: Blog, Product updates Learn all about the Magic Link — how it works, why it’s important for various applications, its advantages for KYC verification, including other concrete examples, and the functionalities of iDenfy’s Magic Link solution. Magic links are often described as the next big thing in passwordless authentication, helping businesses create an alternative method for their users to access services online. Part of this is that standard login credentials, such as a username and password, no longer work; people are now used to instant access or information collection due to enhancements in AI and various automation tools. And it’s no secret that it’s easy to forget a password if you’re not using a password manager or haven’t logged into a particular account for a while.   Security challenges are also part of the issue, since many passwords are still being recycled, increasing the risk of account takeovers, unauthorized purchases, and similar unwanted consequences that both customers and businesses have to deal with. Like a one-time password (OTP), a magic link can be sent to a user’s email, which makes it an appealing option for B2B setups where multiple SaaS tools are used.   We discuss what a magic link is, its other common use case examples, and how they can boost conversion rates in more complex situations, such as KYC verification, down below.   The Definition of Magic Links Magic links are password-free authentication and verification methods, used in various industries, such as e-commerce or banking, as a way to both remotely onboard users during the account creation process, and provide access to log in to their account without entering standard credentials. The process is similar to a password reset, as the user receives a magic link to their email inbox (alternatively, it can be an app or an SMS message).   Magic links are used widely in various industries because they: Create a better and smoother experience for the user without requiring them to manually input data.   Help reduce drop-offs and boost conversion rates due to their simplicity and familiar flow.   What is Magic Link Authentication? Magic link authentication is a token-based authentication method that generates a time-sensitive URL tied to a user’s session, which means the link can then be sent directly to the user's registered email or phone. After clicking the link, users are redirected to confirm their identity by logging in to the platform. So, instead of entering a standard password, magic links eliminate the hassle regarding user experience, along with traditional risks linked to password-based systems. A magic link authentication process can look something like this: The user visits a company’s website or app and enters their email. A magic link is generated, typically with an expiration time.   The user receives an email containing the magic link and clicks on it to proceed with the authentication.   The user is redirected back to the website or app, gaining access to the services.   Magic link authentication can be used during the user registration or later in the business relationship, for example, if the user becomes inactive and wants to re-access their account.   This is a common practice in online marketplaces or any other online platforms where... --- ### Top 5 Compliance Automation Tools in 2025  > Learn about the top 5 compliance automation tools of 2025, which are leading today's market and keep most of the businesses compliant. - Published: 2025-04-23 - Modified: 2025-05-20 - URL: https://www.idenfy.com/blog/top-compliance-automation-tools/ - Categories: Blog It could be hard to choose the right compliance automation tool in 2025, just because there are so many of them, but fear not, we have excluded the best leading compliance automation tools there are in today's market. Small and large businesses face increasing compliance requirements across industries, that’s why it’s very important that organizations ensure they adhere to legal standards from data protection laws like GDPR and CCPA to Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations, mainly to secure the organization itself and avoid laws which could occur. If you decide to manage compliance manually, it could be inefficient and costly.   This is where compliance automation tools come in. These solutions help with regulatory adherence, reducing operational manual tasks, and on top of that, increasing security and accuracy. In 2025, several automation tools appeared as leaders in compliance management, and today we will talk about five of them, with thorough descriptions that define what companies or organizations are capable of, key features, and which companies or organizations should use them.   iDenfy  Rating 4. 9  iDenfy is a market leader in compliance automation, specializing in identity verification, fraud prevention, AML compliance, and much more. iDenfy is strongly focused on fraud detection and real-time user verification, and we ensure that security measures are in place as the regulatory requirements become more complex. Consider - if you want a truly reliable compliance automation solution, iDenfy is truly the go-to option that the market can offer at this time.   Key Features:  Identity Verification: We use advanced biometric technology to verify users, ensuring that businesses comply with KYC regulations.   AML and Fraud Prevention: Transactions are always being monitored for unusual activities, helping businesses stay compliant.   Globalisation: We support over 200 countries, making it a tool for global enterprises.   Integration: Our flexible API allows businesses to integrate iDenfy’s solution into their existing software system. Drata  Rating 4. 9  Drata is one of the top compliance automation platforms in the market, designed to help businesses achieve and maintain continuous compliance with various frameworks. Having monitoring tools, Drata is capable of automating security and reducing compliance risks, also making sure that companies stay audit-ready at all times. The platform can be easily integrated with already existing systems, so it will not be a problem if you are thinking that it is going to mess up systems - it is not going to.   Key Features:  Compliance Monitoring is Completely Automated: Potential compliance gaps are always flagged with the help of continuous security controls tracking.   Pre-Built Integrations: AWS, GCP, Okta, and other primary cloud services are working together with Drata for data integration.   Risk Management Tools: Identifies and lowers security risks with AI-driven insights.   Drata is ideal for startups and mid-sized companies that are looking to streamline compliance automatically.   SecureFrame  Rating 4. 7 SecureFrame is an enterprise-grade compliance automation solution that simplifies adherence to the most popular and well-known frameworks, which are SOC2, ISO 2700, HIPAA, and PCI DSS. Secureframe is ready for businesses that require certain end-to-end compliance management, providing automated security assessments and employee onboarding for compliance training, all of this just to ensure that regulations are in place. With an easy-to-follow... --- ### Best Identity Verification Software Providers of 2025 > Best Identity Verification Software Providers of 2025. Features and reviews of 5 Best Identity Verification Companies. - Published: 2025-04-23 - Modified: 2025-04-27 - URL: https://www.idenfy.com/blog/best-identity-verification-software/ - Categories: Blog, Identity Verification Choose the right identity verification provider This document provides a comprehensive guide to the best identity verification software providers for 2025. It compares features, pricing models, customer reviews, and key factors such as supported countries, document types, and security features. Use this guide to choose the right identity verification solution for your business. Top 5 identity verification providers #NameScoreDescription1iDenfy4. 9An all-in-one identity verification platform to onboard more users. 2Seon4. 8Stop fake users, fraud signups, and risky transactions with SEON fraud prevention software. 3ID. me4. 6Wallet simplifies how individuals discover and access benefits and services through a single login and verified identity. 4Onfido4. 1Create trust at onboarding and beyond with a complete, AI-powered digital identity solution designed to help you get to know your customers. 5Veriff4. 0AI-powered Identity Verification Software. Notable Mentions #NameDescription1JumioDon't fight identity fraud without us2SumSubOne verification platform to secure the whole user journey3TruliooAll Your Identity Verification Combined The Main Features and Suggestions for Identity Verification The most essential features, tips, and tricks of identity verification software that we evaluate in this shortlist of the best identity verification providers: Supported Countries If your business provides services globally, it's essential to ensure customer acceptance from various countries.   iDenfy dashboard - supported countries configuration Recommendation: If you plan to verify identities only from local customers or from a few specific countries, it's a good idea to look for local providers, excluding Mainstream identity verification providers. Local providers with acceptance of fewer countries will be cheaper alternatives. It will save you additional budget. Regulated Business: Examine whether there are countries considered high-risk by regulatory authorities in your operating area. Additional safeguards are required for customers from high-risk countries. More details shall be discussed with local regulatory authorities (which businesses shall comply with AML and KYC requirements? ). Consult with the ID verification provider to see if they can provide “Custom Flows” functionality. You can create different onboarding flows for each country using this functionality. High-Risk Business: If your business is at high risk of fraud. You may want to block customers from specific areas where scamming activities are higher than usual (countries list where scamming activities are higher). Ask the identity verification provider if they have “Country Block List” functionality before signing a contract. Document Types Your business should accept a broader range of customers. Having a bigger audience is healthy for all businesses. Accepting a wider range of document types will allow you to target a broader range of audiences. iDenfy dashboard - supported identity document type Recommendation: Not all customers will have passports or identity cards during identity verification, so it would be worth allowing customers to use driving licenses, residence permits, citizens' identity documents, or even traveling visas. More allowed document types mean more onboarded customers. Regulated Business: You shall examine what document types are allowed in the country in which you operate. Usually, regulators allow limited document types (e. g. , only identity cards and passports). Passports and identity cards have wider security features, such as the Machine Readable Zone (MRZ). High-Risk Business: A... --- ### KYC Requirements in the UK for 2025 [Updated] > KYC is a legal requirement in the UK. And with Brexit, EU's AMLDs, and industry-specifics, it becomes challenging to stay compliant. - Published: 2025-04-04 - Modified: 2025-04-04 - URL: https://www.idenfy.com/blog/kyc-uk/ - Categories: Blog, Regulations by Country The UK ranks at the top regarding fintech adoption. Not only that but also the idea of RegTech and Open Banking originated here, making the UK and its businesses the key players when it comes to technological advancements. Consequently, the evolution of the regulatory landscape led the UK to have strict compliance regulations. In this article, we’ll review different industries and their KYC requirements. Know Your Customer (KYC) is mandatory in the UK. With obliged entities being cryptocurrency exchanges, real estate services, iGaming, e-commerce, or financial services, navigating through various compliance regulations can be a hassle. Even though, at this point, everyone knows the importance of identity verification, certain details or small mistakes can lead to devious consequences.   As KYC requirements vary depending on the operating industry and the jurisdiction, it’s crucial for companies to understand the specifics of how to conduct KYC checks, perform due diligence, and prevent money laundering.   What Do KYC Requirements in the UK Mean? KYC requirements mandate the verification of a user’s identity. This is popular not only among financial institutions but also other industries, such as iGaming or real estate. These requirements are aligned with global standards set by the Financial Action Task Force (FATF). They are integrated into local legislation to prevent money laundering, terrorism financing and other financial crimes.   In simple terms, many industries that handle financial translations in the UK need to ask their customers for IDs and selfies (this is a popular KYC method when document checks are coupled with biometric verification) at the onboarding and later on to ensure ongoing monitoring. That said, the Financial Conduct Authority (FCA) oversees and enforces KYC regulations in the UK, helping various entities comply with KYC and AML/CTF regulations. What Companies are Subject to KYC in the UK? KYC is a mandatory practice in the majority of countries, including the UK. In the United Kingdom, implementing KYC regulations has significantly reshaped various industries, reinforcing transparency and security measures. KYC is also a pivotal component of anti-money laundering (AML) and counter-terrorist financing (CTF) compliance efforts, requiring businesses to verify the identities of their customers and assess potential risks before engaging in financial transactions.   The KYC process extends across diverse sectors, establishing a robust line of defense against illicit activities. Companies from these industries in the UK are obliged to follow KYC requirements: Banks and financial institutions. The financial sector is at the forefront of KYC compliance in the UK. Banks, credit and investment firms, electronic money institutions, money service businesses and payment companies are mandated to perform thorough identity verification and due diligence on customers.   Cryptoasset businesses. With the rise of digital currencies, the need for KYC protocols has grown exponentially. Cryptocurrency exchanges, crypto wallet providers, peer-to-peer crypto transfer service providers, or initial coin offerings (ICOs) must follow KYC requirements in the UK. Real estate. Real estate firms, agents, letting agents or businesses that are dealing with buying or selling property in the UK are subject to KYC regulations. Verifying those who are involved in real estate transactions and ensuring that both buyers and sellers are accurately identified helps maintain transparent financial activities. Gaming and casinos. In the UK, the gaming and gambling industry faces strict KYC requirements. Operators must verify the identity and age of the customer to prevent underage gambling and illicit financial activities.   High-value dealers. Recognizing the potential risk... --- ### The Cost of Fraud > Do not wait for fraud attacks to hit the company - instead, use the various anti-fraud methods specified in this blog post. - Published: 2025-04-02 - Modified: 2025-04-04 - URL: https://www.idenfy.com/blog/the-cost-of-fraud/ - Categories: Blog The fraud issues around the world for the companies are spreading increasingly fast day by day. We have prepared most successful anti-fraud strategy methods that will save your company or organization from losses that could occur in the financial world. Did you ever wonder what fraud feels like? Well, probably, because companies have to be safe from fraud, and to be safe from fraud, you have to imagine what one looks like. This thing called fraud is evolving fast and impacts businesses and companies worldwide, causing them to suffer reputational damage and financial losses. So the next question that comes into mind is, would you want to experience fraud? No? Well, we did expect such an answer, but just to be completely safe, we will discuss the cost of fraud, which can sometimes be immeasurable.   The True Cost of Fraud  Many businesses underestimate fraud and its capabilities. Sure, sometimes it can be lighter than for other companies, but you can not ignore the fact that it can also hit as hard, carrying the business or company to bankruptcy. According to recent studies, global fraud losses amount to trillions of dollars annually, with cyber fraud and identity theft being the most common threats. Here’s the cost of fraud:  Direct Financial Losses:  Fraudulent transactions, chargebacks, unauthorized access, and what not can result in substantial revenue losses for businesses, disrupting the cash flow and impact overall profitability, the fraud reaches its objective, making it difficult for companies to maintain stability.   Additionally, businesses often have to take fraudulent transactions, even when they are not at fault. This not only leads to direct monetary losses but also increases administrative costs associated with fraud prevention and dispute resolution.   Reputational Damage  When users experience fraud on a business or company platform, their trust in the company instantly disappears, keeping them further away from the institution. A damaged reputation can have long-term problems, as it is not easy to make everything right again - public distrust may keep potential users away from the company.   Low-security measures leading to fraud can result in negative reviews on social media and review sites, and as a result, user retention declines, making it harder for the business to maintain a loyal user base and attract new clients.   Legal Compliance  Lots of regulations around the world, for example GDPR require businesses to prioritize data protection and fraud prevention - involving investigation of security measures and ongoing audits, to ensure adherence.   Failure to comply with these standards can lead to several issues for the business, like fines and legal repercussions. In addition to financial costs, non-compliance can damage a company’s credibility, making it challenging to regain user trust.   Operational Disruptions  A common thing is that fraud investigations require a lot of resources, and it comes from the business itself, required mainly for compliance audits and the investigations itself, meaning that attention from main operations is diverted, reducing productivity and increasing operational inefficiencies.   Security and user support resources are also has to be deployed for future fraud prevention, which leads to increased costs and delays in other business functions, affecting overall performance, but what can you do when your business was affected by fraud, only implement stronger... --- ### Case Study: TOPsport  > Learn how the leading iGaming platform, TOPsport, switched to a fully automated player onboarding process and AML screening for compliance. - Published: 2025-03-31 - Modified: 2025-04-01 - URL: https://www.idenfy.com/use-cases/topsport-idenfy-study/ - Categories: Use Cases Learn how TOPsport integrated an automated, user-friendly KYC flow to verify new players and prevent fraud, such as bonus abuse, while running AML checks and minimizing drop-offs to boost conversions on its age-restricted iGaming platform. TOPsport is the first and largest leading iGaming, gambling, and betting company in Lithuania. Starting as a traditional walk-in betting shop, it has grown into a unique gaming hub, offering a wide variety of both standard gambling and online betting, with a selection of compliant, ethical, and secure gaming experiences in sports betting, live casinos, and other bet games. With over 20 years in the market, TOPsport continues to scale its operations while delivering an engaging experience for its players. However, with this sort of volume of players accessing different casino-style and sports betting options online every day, TOPsport needed a reliable Know Your Customer (KYC) and Anti-Money Laundering (AML) solutions provider to ensure that all players are verified as quickly as possible, ensuring they a) don’t provide fake or altered IDs, and b) are of age and can access the age-restricted platform’s games legally. On top of that, to maintain a responsible iGaming environment, TOPsport needed a reliable AI-powered solution for AML screening and monitoring.   The Challenges Since this is a heavily regulated sector handling large transactions, TOPsport aimed to increase security, safeguarding the player journey from start to finish, including the account creation process and what happens after the onboarding. For example, this included monitoring suspicious behavior and ensuring secure transactions when players redeemed their winnings. Tasks like manually reviewing multiple sanctions lists were no longer a sustainable option for its large customer base since they created a backlog for the in-house compliance specialists and increased the risk of missing critical AML red flags.   Additionally, operating in iGaming, which is a highly competitive market, TOPsport wanted to use automation not only for AML screening but also in its KYC program as a way to improve the initial player account creation process. On paper, this seemed like a complex, multi-step process, especially if done manually. That’s why the gaming company looked for RegTech software that could automatically extract personal information from a client’s ID, including their date of birth (DOB), to verify the user’s whole identity, which meant ensuring the player is over 18.   “The new system needed to confirm that the person submitting the document was the actual account holder through liveness checks during the biometric verification stage of KYC. That’s because spoofing was an issue and overall we wanted more accurate fraud detection,” said Dainius Gulbinas, the CEO of TOPsport.   ➡️ Challenges in KYC Verification Customers had to upload documents multiple times, which delayed onboarding and causing frustration, which potentially meant lost conversions and new users going to another iGaming provider. This proved the importance of enhancing different aspects of the identity verification process including efficiency, clear user guidelines, a streamlined flow, and minimal friction. That’s why the new automated identity verification solution:  Needed to be efficient and align with its risk management framework, which included both AML checks and standard ID document checks coupled with biometric verification. Had to meet the industry’s age restrictions and jurisdictional requirements, as the platform offers various... --- ### What is KYC > Want to keep your business or company safe from fraud? Or are you just curious about KYC in general? Look no further, we've got you covered. - Published: 2025-03-31 - Modified: 2025-04-09 - URL: https://www.idenfy.com/blog/what-is-kyc/ - Categories: Blog KYC - a solution that keeps all of the digital world together, verifying users' identities, preventing financial crimes, and ensuring regulatory compliance, all the way from banks to fintech companies, KYC keeps compliance in place by assessing risk levels and monitoring unusual activities. Just imagine you are at a bank, taking out your wallet to show your ID, trying to prove you are not some shady character off the street. Now fast-forward to 2025 - same deal but with a little twist - everything is online, and the stakes are sky-high because there are just so many people, and some of them can be fraudulent. This is where KYC comes in. Short for “Know Your Customer,” it is making sure businesses do not accidentally buddy up with some bots and fraudsters.   Many people just roll their eyes at the KYC procedures, thinking it is just another additional safety measure, but it is much more than that - a system that keeps the digital world together. Interested in learning what is KYC? Its functionalities, its procedures, and everything else it has to offer to a world of security? Look no further; we will cover it right now.   What does KYC Mean?   KYC, or Know Your Customer, refers to a set of processes by financial institutions, businesses, banks, iGaming platforms, adult websites, other companies to confirm the identity of their users and customers. The main goal of KYC is to prevent illegal financial activities, which is very common in today’s digital world, for example, money laundering is one of the most common fraudulent activities out there, as well as the identity fraud.   The process typically includes three main steps:  Customer Identification Program (CIP) - Verifying the identity of a user using official documents like a passport or a bank service to verify the identity.   Customer Due Diligence (CDD) - The user risk profile is assessed to analyze their financial transactions.   Ongoing Monitoring - Continuously track transactions and user behavior to monitor their activities.   This process makes KYC as a whole, and without it, the operations and maintenance of compliance with global KYC regulations would be impossible.   Why is KYC Important?   KYC is not just a regulatory requirement that is implemented only because of the fines that the company would get without it; also maintains the integrity of the financial system and many other things, which we will take a look at:  Financial Crime Prevention  With the verification of user identities, KYC helps prevent money laundering, fraud, illegal activities, and other digital crimes, ensuring businesses are not unknowingly facilitating criminal operations - criminals keep financial systems often exploited, and banks made their primary targets, to move and transfer illegal funds, but with the strict KYC measures in place, a barrier is created by requiring valid documentation and thorough identity checks and verifications.   This process reduces the chances of fraudulent transactions and improves the overall security of financial institutions, and with the implementation of strict KYC procedures, businesses can easily detect unusual activities early and prevent them from happening, report to the authorities, and mitigate financial risks effectively.   Customer Trust  If I were a customer and a user of such a site that handles my payments,... --- ### Case Study: Liquid Noble > Learn about tokenization in the precious metal industry and how AI-powered ID verification and AML screening solutions by iDenfy helped Liquid Noble. - Published: 2025-03-28 - Modified: 2025-04-04 - URL: https://www.idenfy.com/use-cases/liquid-noble-idenfy-study/ - Categories: Use Cases Find out how Liquid Noble adjusted its KYC flow and automated AML screening in a highly regulated environment, reducing noise in the account creation process and cutting ID verification time in half. Liquid Noble is a fintech platform specializing in tokenized precious metals or redeemable digital tokens representing gold, silver, and platinum operating in the Real-World Assets (RWAs) industry. Seeing a great shift in the traditional economic market, Liquid Noble saw an opportunity to use blockchain and revolutionize the precious metal market. Currently, investors on Liquid Noble can seamlessly access and trade real-world assets with the security and efficiency of blockchain technology. In other words, users can invest in gold, store it, and use it for everyday transactions. However, beyond tokenization, Liquid Noble has also built an innovative B2B infrastructure that allows third-party businesses, such as exchanges or payment platforms, to integrate its tokenized assets into their ecosystems. Given the nature of the precious metal industry and stringent regulatory requirements, the fintech platform needed to partner with an experienced fraud prevention service provider that specializes in both identity verification and Anti-Money Laundering (AML) screening solutions that are fully automated, accurate and efficient. Over the past year, the platform has grown rapidly, driven by events like the launch of new gold-backed tokens, further accelerating Liquid Noble’s expansion. To meet its audience's needs and industry-specific requirements, including different verification requirements based on regional and sector-specific requirements for both tokenized transactions and traditional financial operations, Liquid Noble required centralized KYC/AML software. This solution needed to be feature-rich and seamlessly integrate with all aspects of the platform’s already existing AML/CTF program. The Challenges Over the years, Liquid Noble has created a transparent and reliable system that makes gold investment more accessible to a wider audience. The platform’s system is designed to be FATF and AUSTRAC-compliant, ensuring adherence to stringent AML/CTF regulations. However, with these sorts of requirements and the level of accessibility, there’s a greater responsibility when it comes to ensuring compliant transactions that secure its high-quality tokenized assets. Analyzing hundreds of IDs from various countries manually would require extensive expertise and resources in-house, which wasn’t the best option in terms of accuracy and scalability. “We needed identity verification tools that would enable a fast registration process without sacrificing security or requiring extensive internal development,” commented Dan Dragon, the CEO of Liquid Noble.   Liquid Noble wanted to take its innovative financial products to the next level, starting from the very first step, which is identity verification at the account opening stage. For this reason, a manual Know Your Customer (KYC) process wasn’t a viable option, as it would fail the platform’s standards, slowing down various internal compliance procedures. Liquid Noble allows customers to link their payment details to their gold holdings, enabling international transactions. To safeguard their data and finances from breaches or account takeovers, the platform required a secure, global ID verification solution tailored to its international customer base.   “Our customers can use assets on their Liquid Noble account to make purchases anywhere in the world, just as they would with any other currency,” said Dan Dragon. “So we needed a KYC solution with an extensive geographical coverage that supports multiple languages and... --- ### Best KYB (Know Your Business) Software Providers of 2025 > Best KYB (Know Your Business) Software Providers of 2025. Features and reviews of 5 Best Know Your Business Companies. - Published: 2025-03-21 - Modified: 2025-04-07 - URL: https://www.idenfy.com/blog/best-kyb-software/ - Categories: Blog, KYB/AML Explore the latest review of best KYB (Know Your Business) software providers and recommendations on where each of the service excels the best. #NameScoreDescription1iDenfy4. 9All-in-one identity verification and business verification platform2Vespia5. 0Vespia offers an AI-powered KYB platform designed to help companies achieve complete AML compliance3Persona4. 65Online ID verification service to help any business from any industry collect, verify, and manage user identities throughout a customer lifecycle. 4Sumsub4. 6Sumsub is a verification platform that aims to secure entire user journeys5Middesk4. 35Middesk specializes only in business onboarding and company underwriting services Last updated: Notable Mentions #NameDescription1ComplyAdvantageComplyAdvantage gives businesses the financial crime insight they need to take control. 2DotfileOne KYB solution to automate AML procedures,reduce fraud, and reach global compliance. Criteria for Comparing KYB Providers When comparing KYB providers, it is vital to understand the different approaches software providers choose to meet all KYB requirements. In our comparison article, we’re highlighting the critical requirements for a compelling business verification process and comparing whether the solution meets those requirements.   As explained in our KYB guide of 2024, business verification has to perform the following tasks: Official company information collection with necessary documents uploaded.   Identifying UBOs and whole company ownership structure. Performing AML checks and ongoing screening for UBOs Requesting an additional KYC verification for the company representatives or shareholders. Built-in functionality for record keeping, required during the audit process.   Cross-check collected information within official registry documents or credit bureau. Since KYB verification can potentially approve a company, which violates the company’s compliance requirements, the software vendors must qualify as one of the legitimate automation tools. Otherwise, the benefits of automations do not outweigh the manual procedure.   Here is an example of automated business verification flow creation and form-filling requested by the director of the company.   It is also beneficial if the KYB software vendor can offer highly requested features by compliance teams: A dedicated Risk Assessment solution to receive a final company's risk score and set thresholds for specific data fields: country of incorporation, country of operation, UBOs AML data, director's nationality, etc. An AI-based solution for a quick company's detail crossmatch across the registry data and receiving a short overview of all discrepancies. We compare each vendor based on the required functionality and how accurately the provider solves the required task. #1 iDenfy 4. 9 Average Score · (4. 8 Captera | 4. 9 G2 | 5. 0 TrustRadius) With the iDenfy ID verification system, convert more users, scale faster, and tackle security challenges with the powerful, all-in-one identity verification, business verification, fraud prevention, and compliance platform. Information collection and validation. iDenfy offers access to 180+ company registries from 140 countries. For 90 countries, there is an option to get enhanced reports with shareholders and ownership structure. Where information is insufficient, there is an option to get up to 3 months of recency credit bureau data from 160 countries. UBOs and ownership identification. There is an option to request a full ownership breakdown, where all beneficiaries (including other companies and holdings) need to provide the ownership structure, too. To cross-check the information, directors can be requested to submit the incorporation documents.... --- ### How to Find Out Who Owns a Business [Guide] > Learn the key databases where you can lookup the company's ownership structure, finding out who owns a business online. - Published: 2025-03-20 - Modified: 2025-04-08 - URL: https://www.idenfy.com/blog/find-out-who-owns-a-business/ - Categories: Blog, KYB/AML Look through the main government databases and other online methods leading you to accurate sources to break down a company’s ownership structure and find out who really owns it. Regardless of why you want to know who owns a business, it’s simply just one thing that matters, and it’s deconstructing the entity’s true ownership structure. Some business structures are complex, as they are intentionally not intended to disclose all the people behind the company. While this can be treated as a red flag shouting loudly “fraud,” it’s not entirely true or always the case. Finding out about a company is vital when it comes to B2B relationships. It can also be a good call when doing market research when thinking about a potential partnership or investment.   So, whether you’re doing standard market research, conducting due diligence on another entity for legal compliance reasons, such as Know Your Business (KYB) requirements, or just curious to find out who are the members that are responsible for a certain firm’s success, there are some vital pinpoints that you don’t want to miss when looking up the business. For example, structures can be confusing: LLC owners are called "members," while those managing daily operations are "managers. ” While public business registries can be useful, some jurisdictions lack them, and certain company structures require more in-depth research. So, what’s the best strategy to do it right and assess the company? We’ve outlined the key steps that will help you determine whether a business is legitimate or not. Why is Finding Out Who Owns a Business Important?   Learning about a company is the first step to making better business decisions. It helps decide whether the entity that you’re reviewing is trustworthy and a good fit to be in a business relationship. For example, this is important because sanctions compliance constantly changes, and due to today’s geopolitical environment, it’s important to strictly screen sanctions databases, ensuring that the company and its related persons aren’t sanctioned, as required by Anti-Money Laundering (AML) compliance laws.   Beyond mandatory regulations, company background checks help ensure transparency and prevent illegal transactions, detecting risks and concrete factors that need to be considered, especially within complex corporate structures. For example, small local businesses often have rather clear ownership histories. However, the same can’t be applied to larger companies or limited liability companies (LLCs), where owners (known as members) can be harder to identify. There are also exceptions where a business can appoint a non-owner to manage its daily operations. In this case, the actual owners then have other roles, such as the company’s chief technology officer (CTO). How Does KYB Help Check Another Company's Legitimacy? KYB, or Know Your Business verification, is a special regulatory requirement that obligates companies like banks and other high-risk regulated businesses to review and identify other companies before starting to work with them. This includes all partners and third-party vendors as part of AML requirements to prevent fraud and money laundering. Since ID verification checks or Know Your Customer (KYC) have been longer than KYB requirements before they were implemented, criminals used this loophole for crime, which now is solved with more stringent checks not... --- ### Top 10 AML Software for Banks  > The newest blog post about the top 10 AML software for banks will help you choose the best software for your bank. - Published: 2025-03-14 - Modified: 2025-04-10 - URL: https://www.idenfy.com/blog/top-aml-software-for-banks/ - Categories: Blog Nobody is secured from money laundering, until, of course, you implement the right solutions. Sometimes it could be hard to choose one, well this list will help you to choose the best one. Money laundering for financial institutions is not a small problem that has been here for a while but is constantly fought. The world is trying various methods to fight this problem, and advanced Anti-Money Laundering (AML) software seems to work the best, which we will talk about today. Banks, being the targets for fraudulent financial activities, must ensure compliance with regulatory requirements.   The right AML software can improve fraud detection and significantly minimize risk, but many options are available, and it can be hard to choose the right one. So, without further ado, let’s look at the best and top 10 AML software available for banks.   How to Choose a Reliable AML Software?   Before diving into the options for the best software, let’s look at the right AML software factors to consider, which could be critical for maintaining security in banking operations.   Regulatory Compliance: Make sure that the software you are getting complies with regulations such as the Bank Secrecy Act (BSA), the Financial Action Task Force (FATF) guidelines, and others.   Automation and AI: Modern AML solutions should have as little employee interference as possible, and everything should be automated and integrated with AI technologies to detect unusual transactions effectively.   Customization and Scalability: Banks should choose appropriate software for their size and transaction volume and that accommodates business growth.   Data Integration and Compatibility: New software should integrate seamlessly with existing banking systems, such as core banking platforms, transaction monitoring tools, etc.   Reporting Fraud and its Detection: Correct AML system must have real-time monitoring, automated reporting and unusual activity detection.   Cost and ROI: Pricing is important, but banks should think about long-term return on investment (ROI).   Knowing such points will help you choose the right AML software systems more easily.   Essential Functionalities of AML software  It would be a mistake to choose AML software blindly without knowing its essential and minimum functionalities, so let’s take a look at them for banks to better understand them.   Transaction Monitoring: To detect unusual activities in real time and flag them at the same time they occur.   Suspicious Activity Reporting (SARs): Automates the generation of regulatory reports.   Watchlist Screening: Cross-checks users searching for global sanction lists.   Behavioral Analytics: Uses AI and ML to identify fraudulent transaction patterns.   Audit Trail and Case Management: Keeps a detailed record of investigations for regulatory review.   These essential features must be implemented in every AML software, so if you are considering AML software, ensure it includes these.   #1 iDenfy iDenfy website: https://www. idenfy. com | Score 4. 9 iDenfy is a top AML and identity verification tool that uses AI to fight fraud, handle Know Your Customer (KYC)/AML compliance, and verify identities with biometric technologies. We have various tools that help to spot anything weird and catch risks as soon as they appear. We are not only lightening the load for companies and businesses but also for banks and financial institutions, heightening... --- ### 5 Online Casino Scams You Need to Know in 2025 > Find out what kind of schemes fraudsters use to cheat iGaming platforms and learn how they actually succeed with such online casino scams. - Published: 2025-03-13 - Modified: 2025-04-09 - URL: https://www.idenfy.com/blog/online-casino-scams/ - Categories: Blog Access this online casino and iGaming guide to learn about the most popular casino scams and find out what kind of concrete measures help gambling platforms stop scammers who use bots, multiple accounts, stolen credit card details, or forged documents, and more. Due to their somewhat attractive, addictive nature, gambling and gaming have been popular activities in various countries and cultures globally. Some play to win; some argue that casinos are a stupid way to lose cash. However, when the global pandemic hit, millions of users turned to online gambling, casino, and sports betting platforms to access that convenient alternative to dozens of entertainment options on the internet. To this day, this change has shifted how we see the iGaming industry, especially since gambling and casinos have become mainstream.   Statista projects that the gambling market will reach at least 977. 3 million users by 2029. With such numbers, online casino scams have also become a hot topic on the radar. While we were used to inside jobs, chip dumping schemes, or the good old card-counting tactics, now we have more complex deceptive practices such as multiple accounts, bonus abuse, or the classic issue that casino and gaming establishments face, money laundering.   So, does the house always win, or have scammers actually found ways to outsmart casinos and walk away with big money? We’ll find out below.   How Does an Online Casino Scam Work? A typical online casino scam is based on deceptive tactics where the individual aims to take advantage of the regulatory loopholes or the general casino system to gain a personal benefit of some sort, often financial gain. Due to the nature of online casinos and iGaming, it has a reputation of having legal grey areas and an attractive environment for cheating.   For example, a common casino scam is when a user creates multiple accounts, even though they are not allowed, uses stolen IDs to bypass Know Your Customer (KYC) checks, or employs spoofs to avoid getting detected using the same IP address on all their accounts.   Common online casino scam examples include: Abusing welcome bonuses by using bots or creating multiple accounts to access free spins and other similar advantages that help win.   Using stolen credit cards to fund other already existing accounts or withdraw winnings from the online casino.   Impersonating other users or using stolen details to create synthetic identities and fake accounts for unauthorized withdrawals.   Rigging casino games by undermining fair play and manipulating the platform’s staff illegally.   Using software and other technologies to exploit the casino’s vulnerabilities and access funds by manipulating the games’ outcomes.   Why does this happen? Simple. Online casino scams don’t require face-to-face interaction and are surrounded by the anonymity factor that comes with online gambling platforms and digital transactions. However, like with traditional gambling establishments, online casino scams result in financial loss for both the casino and its legitimate players, as they can be targeted as well.   What are the Most Common Online Casino Scams in 2025? Gambling revenue in the US alone reached $71. 92 billion last year, up from $66. 65 billion the year before. However, the bigger these numbers grow, the more bad actors want to leverage the... --- ### Best KYC Software Providers of 2025 > Best KYC Software Providers of 2025. Features and reviews of the 5 Best KYC Verification Companies. - Published: 2025-03-12 - Modified: 2025-03-12 - URL: https://www.idenfy.com/blog/best-kyc-providers/ - Categories: Blog, Identity Verification Explore the latest coverage of best KYC software providers and recommendations on where each of the service excels the best. #NameScoreDescription1iDenfy4. 9All-in-one identity verification platform to onboard more users2Focal4. 8AI-driven platform for AML compliance and fraud prevention, streamlining customer onboarding and real-time risk management.  3SEON4. 6Stop fake users, fraud signups, and risky transactions with SEON fraud prevention software4ID. me4. 1Create trust at onboarding and beyond with a complete, AI-powered digital identity solution built to help you know your customers5Onfido4. 0AI-powered Identity Verification Software Last updated: Notable Mentions #NameDescription1LexisNexisEstablished in 1970, it is one of the key players in the global regulations and compliance industry2SumsubAll Your Identity Verification Combined Criteria for the best KYC software provider When choosing the right KYC vendor, the important considerations are based on the vendor’s experience working with identity verification, AML screening requirements, and business verification. Here are the specific requirements for the KYC vendor to be an effective part of the company’s compliance process. Features of identity verification software Countries support. Depending on the regions your company onboards customers from, it is essential to choose a provider with compatible countries. Also, there should be an option to specify a blocklist of countries, ensuring that jurisdictions with high-risk scores would be unavailable during the KYC process or return the blocklist attribute as part of the JSON response. Document types. The identity verification provider has to provide options for multiple document types in case the user needs to provide a driver's license or residence permit instead of a standard passport or ID card. Simultaneously, there should be an option to blocklist specific document types. Liveness verification. With the rise of deepfake technology, it becomes crucial to determine whether the selfie is from an actual human being or manufactured. Two options are typically chosen: passive and active validation. Passive usually requires only a single photo, while active requires additional facial gestures.   Automated vs Human-Supervised ID Verification. Even the most sophisticated identity verification solution does not guarantee 100% accuracy due to poor document quality or simply human error. Thus, the option for the manual review team plays a crucial role in the overall success rate of the KYC process. Pricing options. If the identity verification provider is too expensive or the pricing is unreasonable, it might not be worthwhile to automate the KYC process altogether. While choosing the identity verification vendor, it is critical to evaluate what exactly is being charged. KYC Risk Assssment. Client risk scoring is essential for businesses to evaluate potential risks, prevent fraud, and ensure regulatory compliance. The general rule is that the system calculates each category risk by its weight and sums up everything ((1 Category risk * 1 Category weight) + (2 Category risk * 2 Category weight) + (2 Category risk * 2 Category weight)... ). This means that if you have two categories - nationality data (weighted at 50%) and income data (weighted at 50%) - a person may still be assigned a high-risk status. --- ### Best AML Software Providers of 2025 > Best AML Software Providers of 2025. Features and reviews of 5 PEPs, Sanctions, and Adverse media screening companies. - Published: 2025-03-12 - Modified: 2025-03-12 - URL: https://www.idenfy.com/blog/best-aml-software-providers/ - Categories: Blog, KYB/AML Explore the latest coverage of best AML software providers and their PEPs, sanctions and adverse media capabilities. #NameScoreDescription1iDenfy4. 9All-in-one identity verification and business verification platform2Sumsub4. 6Sumsub is a verification platform that aims to secure entire user journeys3ComplyAdvantage4. 1ComplyAdvantage gives businesses the financial crime insight they need to take control. 4Onfido4. 1Create trust at onboarding and beyond with a complete, AI-powered digital identity solution built to help you know your customers5Veriff4. 0AI-powered Identity Verification Software Last updated: Notable Mentions #NameDescription1LexisNexisEstablished in 1970, it is one of the key players in the global regulations and compliance industry2SalvRisk scoring, AML compliance software hub, offering a wide range of services for financial institutions. Criteria for Comparing AML Service Providers When we compare the best AML software vendors, we take into account a few major aspects: compliance with up-to-date regulatory requirements and the correct software approach. Suppose an AML service does not provide up-to-date sanctions or PEP information whenever new subjects are included in the sanctions list. In that case, a company using such a service has a higher chance of receiving a penalty during auditing, especially if the company is subject to mandatory AML compliance.   Additionally, if the service does not provide the correct API or dashboard integration, then the company has to spend additional development resources to have the following functionality: On-demand AML or adverse media checks for one or bulk users. Ongoing periodic checks for included subjects. Full history of AML hit changes. In this coverage, we aim to verify whether software vendors actually cater to businesses' needs and offer the necessary services. The most common ones are Enhanced due diligence (EDD), Customer due diligence (CDD), and countering common AML fraud occurrences. We’ve chosen the following criteria and compared how each of the AML software providers implements the following functionality: Sanctions & PEPs check AML ongoing monitoring Adverse media screening Integration with identity verification Company sanctions check and Know Your Business integration Here is an example of sanctions and PEPs screening with ongoing monitoring. We compare each vendor based on the required functionality and how accurately the provider solves the required task. #1 iDenfy 4. 9 Average Score · (4. 8 Captera | 4. 9 G2 | 5. 0 TrustRadius) With the iDenfy ID verification system, convert more users, scale faster, and tackle security challenges with the powerful, all-in-one identity verification, business verification, fraud prevention, and compliance platform. Sanctions & PEPs check. iDenfy integrates with major sanctions lists and 4 levels of PEP status. The update frequency is daily for both PEPs and Sanctions. iDenfy offers data from all local and regional sanctions. They also return data on associated relatives for PEPs. AML ongoing monitoring is implemented both in the dashboard and via API. Every day, software tracks whether new changes occur. If so, the monitoring subject emits an alert, which is then visible in the dashboard and received via webhook callback. Then, the compliance officers can tick the hits as true positives. For adverse media screening, iDenfy uses its own search algorithm, indexing all relevant news sources. To optimize the search results, there is an option to search... --- ### How to Choose The Best KYC SaaS Platform for 2025 > Wondering how to choose the best KYC SaaS Platform for 2025? Idenfy got you covered. Learn what features represent the best platforms. - Published: 2025-03-10 - Modified: 2025-04-08 - URL: https://www.idenfy.com/blog/best-kyc-saas-platform/ - Categories: Blog KYC SaaS in 2025 is not an optional choice - it is a necessary one. If you want your company to be safe, consider choosing one, but how to choose the right one, when there are already so many existing with various features? Let's take a look at that. If you are a start-up company or a senior one, ensuring compliance with Know Your Customer (KYC) regulations is more important today than ever before. Businesses across various industries must have effective identity verification processes to be ready to face fraud because, one way or another, it is going to happen, and it will be hard to avoid it and face it without having implemented effective KYC. As we are almost three months into 2025, selecting the right KYC Software as a Service (SaaS) platform can be hard but a worthy objective, as it can offer automation, improved security, and cost-effective compliance solutions. But there are so many of them, and one must stop for a minute and think about which SaaS would be the best for the organization. Do not worry about that, because here we will talk about key factors to consider, must-have features, and how to make an informed decision.   What is a KYC SaaS Platform?   Businesses would not be able to use it if they did not know what a KYC SaaS Platform is, so let us explain it to you so your choice will be smoother. A KYC SaaS platform is a cloud-based service that helps businesses verify the identity of their users with regulatory requirements. To ensure that the user experiences a smooth verification process, the platforms use artificial intelligence (AI) and machine learning (ML) technologies.   There are still traditional KYC processes that heavily rely on manual KYC checks, which take lots of time. Meanwhile, KYC SaaS solutions offer automation, verification in seconds, and continuous monitoring, making compliance way more efficient and less time-consuming. It is very beneficial for companies to use KYC SaaS platforms as they can improve security, reduce operational costs, and improve user trust and experience. As fraud tactics are becoming more challenging to recognize, implementing the right KYC SaaS solution and choosing the right platform is essential for every company. Key Considerations When Choosing a KYC SaaS Platform  Well, as we now know what the KYC SaaS Platform is, we can look at what you should consider when choosing a KYC SaaS platform. 1. Compliance with Global Regulations KYC requirements vary across different countries, making it very important to select the right platform that has major regulatory frameworks such as the General Data Protection Regulation (GDPR) for data privacy, the Financial Action Task Force (FATF) guidelines, as well as the Bank Secrecy Act (BSA) for monitoring unusual financial transactions. The platform you will use should also support evolving Anti-Money Laundering (AML) laws and Customer Due Diligence (CDD) measures to maintain compliance across international markets.   If a company fails to comply with these regulations, it gets fined, which could lead to bankruptcy, and if not that, huge reputational damage is also an option which would be bad for every business out there, no matter if it's a new one. A reliable KYC platform should offer built-in regulatory updates to ensure the company remains aligned with changing legal... --- ### Case Study: Proxyrack > Learn how Proxyrack optimized its KYC flow by integrating iDenfy's end-to-end ID verification software for improved conversion rates. - Published: 2025-03-10 - Modified: 2025-03-10 - URL: https://www.idenfy.com/use-cases/proxyrack-idenfy-study/ - Categories: Use Cases Find out how Proxyrack automated the whole identity verification process and, instead of relying on its team to handle re-verification attempts manually, used iDenfy’s software to improve verification times, even during volume spikes. Proxyrack is a provider of proxy solutions designed to help businesses and individuals enhance their online data-collection capabilities. With a vast network of residential and data center proxies, the platform strives for accuracy by providing diverse IP addresses and scalable performance. Proxyrack prioritizes fast onboarding, helping users find the right proxy to get started in under 10 minutes. Proxyrack’s goal is to constantly evolve and meet diverse user needs as the company’s values align with the clients' requirements and eagerness to bring any ideas to life. To improve its proxy selection and maintain this seamless and lag-free experience, Proxyrack decided to look for a new partner in identity verification or Know Your Customer (KYC) compliance management. As user volume grew, scaling became a challenge with the previous provider, leading to Proxyrack’s decision to find a new RegTech partner for a smoother identity verification process. The Challenges Creating different verification flows for proxy service users is complex, as this sort of audience, where user experience comes first, can switch to another provider really quickly after experiencing a poor first impression. On top of that, local and global KYC requirements needed to be met, which made it challenging for Proxyrack to balance end-user experience and complete compliance without increasing drop-off rates with the previous ID verification process. Additionally, Proxyrack noticed another issue — rising fraud schemes that have become more sophisticated, especially with increasingly popular generative AI schemes. This made real-time fraud prevention difficult, especially regarding deepfakes. To counter this challenge, Proxyrack needed to adopt a new, customizable, dual-layer KYC process, combining automated ID document data extraction with selfie biometrics and 3D liveness detection to detect bypass attempts with the highest accuracy rates. “We encountered a significant challenge with our previous KYC provider, where users were often miscategorized, causing delays and errors that negatively affected the overall customer experience,” said Ariana Wang, a Fraud Expert at Proxyrack. Furthermore, effective risk assessment and management practices were essential for maintaining the integrity of Proxyrack’s platform. KYC onboarding data needed to be accurate and collected quickly, with the main goal of adding more credibility to Proxyrack’s platform. This included finding new ways to identify unusual user behavior and suspicious patterns quicker, prevent fraud and money laundering, and promote responsible use of its proxy services. Proxyrack also didn’t want to hurt the business with chargebacks and fraudulent disputes, which always come with extra unwanted costs and potential damages, including negative effects on the company’s compliance standings: “Reducing the likelihood of chargebacks or disputes due to unauthorized transactions or fraudulent accounts was critical for us, especially in payment processing, to ensure smooth operations and protect our business from potential losses,” explained Ariana Wang, a Fraud Expert at Proxyrack. So, in this sense, both its in-house compliance team and end-users wanted to feel more in control of the process: Compliance specialists needed a unified dashboard where they could manage KYC verifications more efficiently (with the right building blocks to access due diligence data). Customers needed a more straightforward... --- ### Know Your Business (KYB) Service: Ultimate Compliance Guide > Know Your Business (KYB) is the process of verifying the identification information provided by a company. And it's more complex than KYC. - Published: 2025-03-05 - Modified: 2025-04-09 - URL: https://www.idenfy.com/blog/know-your-business-kyb/ - Categories: Blog, KYB/AML Verifying the legal status of a company, identifying its beneficial owners, and monitoring risks to ensure ongoing compliance are all important stages of Know Your Business verification. But this process remains a mystery to some organizations, often resulting in many challenges. Know Your Business (KYB) is a process that verifies the legal status of a business and its compliance with Anti-Money Laundering (AML) regulations. Regulated entities must perform KYB verification to protect their interests. This background check prevents forming ties with shell companies or any illegally operating organizations.   This process helps companies understand potential business partners and those with whom they want to start a business relationship. In the B2B field, this is very important, as companies need to do background checks on the other entity’s shareholders, company owners, directors, suppliers, or third-party vendors. So, while the Know Your Customer (KYC) (focused on individual customers, not business entities) concept is more known to the general public, KYB holds the same value and importance in the regulatory compliance field.   In brief: To ensure that they are working with legitimate businesses that operate within the law, financial institutions such as banks and fintechs must perform both KYC and KYB checks. While KYB and KYC involve verification processes, KYB requires an additional layer of complexity since it focuses on confirming the legitimacy of both the business and ultimate beneficial owners (UBOs). So, knowing the true nature of a company is essential in preventing financial crimes such as terrorist financing and money laundering. KYB, in particular, takes this step further by additionally requiring companies to establish UBOs. This layer of security enables businesses to determine who directly benefits from the company's profits, making it harder for criminals to conceal their illegal funds.   What is Know Your Business? The Know Your Business (KYB) process is designed to verify another company by confirming its legitimacy through multiple important data points.  This often includes verifying the company’s registration number, license, physical address, shareholder information, source of funding, and so on. KYB is part of a bigger AML framework that aims to detect fraud and prevent illicit activities that can come with B2B relationships, such as money laundering using shell companies.   Why is KYB Verification Important? Using KYB verification services is critical to detect fraudulent activity among corporate clients effectively and prevent partnering with non-compliant businesses or those that are too much of a risk based on your internal AML risk assessment. For example, it’s illegal to partner with a sanctioned entity. That’s why during KYB verification, businesses conduct AML screening, scanning various sanctions lists, among other procedures aimed at detecting crime, including ties to money laundering. The key reasons why businesses implement KYB checks include: A proper process for identifying business owners, shareholders, or individuals attempting to conceal illicit funds through hidden corporate structures.   A better way for understanding the legitimacy of another company, helping companies identify legitimate corporations and non-compliant or high-risk entities. Since corporate clients are more complex to deal with than individual customers, KYB helps establish a more thorough understanding of the other company. A robust KYB system can detect red flags for money laundering and help regulated entities stay compliant by establishing timely suspicious activity reporting practices. Given the... --- ### How to Check if a Company is Legitimate > Thinking of making a big purchase or signing an important business deal? It's okay to feel anxious. Learn how to check if a company is legitimate. - Published: 2025-03-04 - Modified: 2025-05-14 - URL: https://www.idenfy.com/blog/check-if-a-company-is-legitimate/ - Categories: Blog, KYB/AML - Tags: Know Your Business (KYB) Especially in business, signing a contract without doing detailed research can result in becoming a money laundering channel. That’s why in today’s complex digital environment, it’s essential to take your time to research every single company that you’re interested in doing business with. Whether you're a small business or a big enterprise, the consequences of dealing with an illegitimate company are always harmful. For instance, let’s say that a young startup signed a contract with a supplier that doesn’t actually exist. That means the company got burnt and lost time and money resources. And let’s not forget third parties and customers; they all require running a series of background checks. This guide will explain how to check if a company is legitimate. It’s natural to worry about the authenticity of a company, especially if you think of doing business together.   Similar to Know Your Customer (KYC) regulations where businesses verify their customers’ identities, it’s become standard practice to check the authenticity of a company. This is where Know Your Customer (KYB) compliance measures come in handy. To complete a smart risk-mitigation strategy and combat fraud easier, businesses use automated KYB tools, such as Business Verification, to scan and check the legitimacy of any company.   While it took us a while, modern businesses are no longer annoyed to carry out due diligence and keep up with the ever-evolving regulations. Despite the positive, pro-compliance mindset, fraud remains a challenging issue that’s hard to tackle for many companies. Did you know that 90% of money laundering crimes are never detected? The United Nations claims that around $800 billion to $2 trillion is laundered annually around the world. One thing’s for sure. Whether you're a business or a customer thinking of making an online purchase, nobody wants to fall into a trap just to find out that the company or the website turns out to be a scam. Thankfully, being aware of the most common scamming techniques helps prevent unwanted losses. Make Sure to Review the Company’s Website  Naturally, certain red flags raise suspicion regarding the business’ authenticity. First things first, if you can’t find any contact information listed on the website, such as a legitimate phone number, and there’s no way to contact the company, chances are the business might not be genuine. The easiest way to check if the phone number is valid is by calling it. If it’s disconnected, that’s automatically a bad sign.   Remember that today, having an email address isn’t the most trustworthy indicator of the legitimacy of a company. That’s because emails and domain names are obtained easier compared to offline contact information. Before engaging with a business, it’s wise to verify the email address to ensure it’s active and associated with a legitimate domain. If we take a look at financial institutions, they fall on the stricter side of the jurisdiction, which requires such regulated entities to provide the following data: Information about the company’s payment methods The purpose of business transactions The business’ location The nature of the company Information about partnerships and the company’s certificates Study the Address Information Address fraud remains one of the most common types of fraud today. Usually, fictitious office addresses are used to launder money and hide from authorities. If... --- ### Machine Readable Zone > Machine Readable Zone (MRZ) is a particular area in an ID document (passport, id card) that encloses the document holder's personal data. - Published: 2025-03-03 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/machine-readable-zone/ - Categories: Blog, Identity Verification Wondering what is a machine-readable zone (MRZ)? Do you want to know its role in identity verification? If the answer to these questions is "yes." Read this blog until the end. What is the Machine Readable Zone (MRZ)? MRZ, or Machine Readable Zone, is a particular area in an identity document (passport, identity card, or residence permit specifically) that encloses the document holder's data. Nowadays, almost every country's official identity or travel documents have MRZ, containing encrypted confidential information. Generally, the Machine Readable Zone has two or three lines with the printed OCR (Optical character recognition) font (OCR-B font) text. The MRZ-based documents are machine-readable because a machine only reads the texts they contain. This post will teach about the Machine Readable Zone (MRZ). What types of MRZs are available and their role in identity verification. However, before that, let's take a quick look at the history of MRZ. History of machine readable documents In 1980, a machine-readable zone was added to the passport's identity page for the first time.  Today, along with the photo and necessary details (full name, date of birth, passport number, passport expiration date, etc. ) of the passport holder, the identity page includes two lines containing some letters, numbers, and symbols known as the MRZ line. In 1983, the U. S. government accountability office highlighted the benefits of machine-readable information. The use of Machine Readable Zone has become more popular. Today, it is used in national identity and travel documents. Unique optical character recognition equipment is required to read the information embedded in MRZ. Nowadays, it can be accessed using a smartphone – thanks to the ever-increasing technology! How does a machine read MRZ code? A machine-readable zone contains encoded lines/codes, including the document holder's data and forgery detection numbers known as the machine-readable zone's "checksum". As mentioned above, a special reading device detects MRZ and reads the information encoded inside. Text recognition and conversion technology (OCR system) is used to read and verify MRZ data on travel documents, such as passports. See the following image to recognize the machine-readable zone in a passport: Encoded data is obtained by scanning and then saved in electronic format to access the data from MRZ. There are a few stages this process goes through: Data scanning In this stage, the picture of the ID document is scanned. Extracting data from a Machine Readable Zone Once the I. D. document is scanned and the machine-readable zone is captured, the embedded text is recognized and parsed to extract the data fields. An optical character recognition (OCR) system calculates the checksum of the extracted data. After that, the calculated checksums are compared with the original checksums for data verification. This data can also be exported to an external device for further inspection and verification. What's the purpose of MRZ? It's not difficult for fraudsters to tamper with identity documents and manipulate the holder's personal information for their purpose in modern times. Many times, we have heard the news of fake passport gangs in Europe and across the globe engaged in forging documents. A machine-readable zone in a passport and other identity documents is a significant step to prevent unauthorized alteration in the IDs. Furthermore, it is an ideal way to speed up the verification... --- ### Machine Readable Zone > Machine Readable Zone (MRZ) is a particular area in an ID document (passport, id card) that encloses the document holder's personal data. - Published: 2025-03-03 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/machine-readable-zone/ - Categories: Blog, Identity Verification Wondering what is a machine-readable zone (MRZ)? Do you want to know its role in identity verification? If the answer to these questions is "yes." Read this blog until the end. What is the Machine Readable Zone (MRZ)? MRZ, or Machine Readable Zone, is a particular area in an identity document (passport, identity card, or residence permit specifically) that encloses the document holder's data. Nowadays, almost every country's official identity or travel documents have MRZ, containing encrypted confidential information. Generally, the Machine Readable Zone has two or three lines with the printed OCR (Optical character recognition) font (OCR-B font) text. The MRZ-based documents are machine-readable because a machine only reads the texts they contain. This post will teach about the Machine Readable Zone (MRZ). What types of MRZs are available and their role in identity verification. However, before that, let's take a quick look at the history of MRZ. History of machine readable documents In 1980, a machine-readable zone was added to the passport's identity page for the first time.  Today, along with the photo and necessary details (full name, date of birth, passport number, passport expiration date, etc. ) of the passport holder, the identity page includes two lines containing some letters, numbers, and symbols known as the MRZ line. In 1983, the U. S. government accountability office highlighted the benefits of machine-readable information. The use of Machine Readable Zone has become more popular. Today, it is used in national identity and travel documents. Unique optical character recognition equipment is required to read the information embedded in MRZ. Nowadays, it can be accessed using a smartphone – thanks to the ever-increasing technology! How does a machine read MRZ code? A machine-readable zone contains encoded lines/codes, including the document holder's data and forgery detection numbers known as the machine-readable zone's "checksum". As mentioned above, a special reading device detects MRZ and reads the information encoded inside. Text recognition and conversion technology (OCR system) is used to read and verify MRZ data on travel documents, such as passports. See the following image to recognize the machine-readable zone in a passport: Encoded data is obtained by scanning and then saved in electronic format to access the data from MRZ. There are a few stages this process goes through: Data scanning In this stage, the picture of the ID document is scanned. Extracting data from a Machine Readable Zone Once the I. D. document is scanned and the machine-readable zone is captured, the embedded text is recognized and parsed to extract the data fields. An optical character recognition (OCR) system calculates the checksum of the extracted data. After that, the calculated checksums are compared with the original checksums for data verification. This data can also be exported to an external device for further inspection and verification. What's the purpose of MRZ? It's not difficult for fraudsters to tamper with identity documents and manipulate the holder's personal information for their purpose in modern times. Many times, we have heard the news of fake passport gangs in Europe and across the globe engaged in forging documents. A machine-readable zone in a passport and other identity documents is a significant step to prevent unauthorized alteration in the IDs. Furthermore, it is an ideal way to speed up the verification... --- ### KYC Verification [3 Main Components & More] > Learn all about KYC verification from the RegTech expert's perspective, focusing on the key KYC/AML components in different sectors. - Published: 2025-02-28 - Modified: 2025-03-12 - URL: https://www.idenfy.com/blog/kyc-verification/ - Categories: Blog, Identity Verification Access our expert insights regarding KYC verification, with step-by-step examples for different industries, including other AML processes that are mandatory after the initial user onboarding stage. KYC, or Know Your Customer verification, is a commonly used method to identify, verify, onboard, assess, and monitor customers — which doesn’t necessarily involve only standard IDs or end when the user is accepted to a platform after opening their account. It’s a detailed process that protects financial institutions and other regulated sectors from fraud and unwanted business relationships that can lead to major non-compliance fines.   So, it’s safe to say that throughout the years, KYC verification, or identity verification, together with anti-money laundering (AML) regulations, have been a universal approach to ensure that companies engage with legitimate individuals and entities. Standard requirements include measures like government-issued ID verification, biometric checks, address verification, database checks, AML screening — and more — which we’ll discuss in more detail below.   What is KYC Verification? Know Your Customer (KYC), or KYC verification, is the process of verifying a customer’s identity during the onboarding and assessing potential risks, such as ties to money laundering, before agreeing to do business with them and allowing them to open an account. Banks, fintech platforms, real estate firms, e-commerce companies, and similar entities are required by law to implement KYC checks. These regulations also extend to certain cryptocurrency exchanges and money service businesses (MSBs).   There’s a standard for verifying identities for KYC, but it still depends on the use case and industry. For example, if it’s an age-restricted item seller online, the platform has to adapt its KYC flow to meet age verification requirements (and check if the buyer is of legal age). In crypto, extra verification checks before withdrawals, such as Proof of Address (PoA) and providing a document like a utility bill, are standard KYC practices.   The Main Goal of KYC  KYC requires companies to implement an identity verification flow that’s built around these steps: Confirming a customer’s identity Understanding their activities, focusing on verifying the legitimacy of their funds Assessing money laundering risks through continuous monitoring Ultimately, KYC verification helps companies guarantee that the user who’s completing the process is genuine: they aren’t using forged or altered ID documents, stolen source of funds documents (for example, to manipulate the institution into securing a bigger loan), outdated proof of address (for instance, to get their account back after it’s been breached and blocked on an online marketplace), and so on.   However, the biggest issue today is that KYC checks based on only a single layer of verification, for example, document checks, where IDs (passports, driver’s licenses, or ID cards) are verified, aren’t enough. High-risk, regulated entities, such as payment service providers, combine multiple ID verification methods (for example: document verification + selfie verification + address verification) to build a solid KYC verification process that doesn’t allow fraudsters to bypass and manipulate the system to create multiple accounts and conduct unauthorized purchases, or worse, launder funds under a stolen identity or a money mule using schemes like structuring.   Related: KYC Challenges and How You Can Overcome Them What are the 3... --- ### Best 8 Fraud Prevention Solutions in 2025 > Learn about how to be safe and choose the best fraud prevention solution that would fit your company in 2025. - Published: 2025-02-27 - Modified: 2025-05-14 - URL: https://www.idenfy.com/blog/best-fraud-prevention-solutions/ - Categories: Blog To completely protect your business from fraud, you will have to choose which fraud prevention solution to use. Learn about them here and select the one that fits your company the best. It does not matter if you are an eCommerce, iGaming, online banking, digital services, or any other company, you should always proactively keep your company’s operations safe from fraud, using technologies such as fraud prevention solutions. In 2025, cybercrimes will only continue to rise, and it does not seem that such things will stop soon. It looks like fraud cybercrime techniques will only be updated, and fraudsters will implement new technologies to make as many cybercrimes as possible.   Let’s look at the seven best fraud prevention solutions for companies in 2025, comparing their strengths, features, and suitability for different industries. Businesses will be able to make informed decisions and select the right tool to keep away from fraudulent activities.   How to Choose a Fraud Prevention Solution  Before getting into the best fraud prevention solutions, let’s see how the companies can choose one. We should also mention that selecting the right fraud prevention solution may depend on several factors, and businesses should consider these aspects:  Industry–Specific Needs: As we know, different types of industries face unique fraud issues and challenges. A solution designed for eCommerce fraud may not be as effective for iGaming fraud. Businesses should assess their specific requirements before choosing a provider.   Technology and Features: Machine learning (ML) is a valuable tool for fraud detection because it can instantly learn from other instances where fraud happened and implement preventative techniques, stopping fraud before it occurs within another organization. Users’ behavioral analytics and real-time monitoring tools are also alright for fraud detection and prevention.   Integration and Scalability: The software you will implement should integrate with your existing systems without problems and be scalable to accommodate business growth.   Cost and Return on Investment: Weigh the cost, as fraud prevention software could be expensive against potential savings from preventing fraud-related losses.   Regulations: Many organizations require compliance with GDPR, PSD2, KYC, and AML policies, helping businesses meet legal obligations.   So, we have learned what businesses and organizations should look into when considering buying fraud prevention software. Now, we can freely get into the best fraud prevention solutions available out there in 2025.   #1 iDenfy  iDenfy's official website: www. idenfy. com iDenfy's all-in-one ID verification system provides businesses with a comprehensive solution for identity verification, business verification, fraud prevention, and compliance. Increased growth speed, improved security measures to face fraud, efficient user onboarding - all of this with our platform. With us, businesses can optimize operations and maintain regulatory compliance, ensuring secure and scalable long-term growth.   We enable businesses to verify users instantly using biometric authentication and various document scanning, beginning from ID to addresses. If that is not enough, with advanced proxy and VPN detection, we ensure that fraudsters would not be able to hide behind fake IPs or other manipulated data. With such compliance tools and real-time risk scoring, iDenfy offers the best fraud detection software.   Features:  AI Identity Verification (IDV): Facial recognition, document authentication, and biometric technology are all used to... --- ### Case Study: Rebell Pay > Find out how Rebell Pay integrated iDenfy's KYC and AML software to lower compliance costs by 15%, all thanks to automation and custom flows. - Published: 2025-02-27 - Modified: 2025-02-27 - URL: https://www.idenfy.com/use-cases/rebell-pay-idenfy-study/ - Categories: Use Cases Discover how Rebell Pay, a cross-border P2P payment provider, optimized its compliance processes with iDenfy, integrating ID verification and AML screening to cut costs using automation. As a cross-border money transfer service provider, Rebell Pay is operating in a highly regulated, high-risk environment. Given such industry dynamics, its mission is to improve and advance cashless payment systems with a focus on two factors: multi-layered security and effortless user experience. To keep up with this competitive market, Rebell Pay has proven to offer minimal formalities and no additional fees for payment transfers over the years. The services are simple and centered around a user-first mindset, as it takes only a few minutes at most to make the transfer on the platform, no matter the currency or the recipient. As a result, Rebell Pay needed a more advanced automated solution that would keep up with ever-changing expectations for the users. This meant a quicker registration process, which required mandatory identity verification checks. For this to happen in practice, the financial company needed to look for a RegTech partner that is a true expert in two fields: Know Your Customer (KYC) verification and Anti-Money Laundering (AML) screening — both of which are vital for onboarding new customers, conducting due diligence and maintaining accurate risk assessment practices. The Challenges Due to the connected nature of modern finance, governments worldwide have been expanding KYC/AML policies to prevent financial crimes, putting scrutiny on financial companies like Rebell Pay. However, in practice, due to new technologies, a lack of standardized AML policies across jurisdictions, and the scale of money laundering, there are several challenges that need to be considered. For Rebell Pay, this meant looking for a new multi-feature and global RegTech service provider that could: Ensure regulatory compliance on a global scale. Reduce manual labor for the in-house compliance team. Improve the customer experience during identity verification. Detect AML red flags more accurately, preferably in real-time. Offer customization options for a different onboarding flow based on different jurisdictional requirements. “We wanted to build a fast and easy onboarding process that meets diverse requirements. Since our network consists of more than just domestic payments, we have to adhere to strict global and local regulations,” explained Paweł Karczewski, the CEO of Rebell Pay. The financial service provider wanted to scale faster and improve identity verification pass rates while identifying potential hazards, such as individuals suspected of criminal activity, including high-risk sanctioned entities, and Identify Politically Exposed Persons (PEPs). For that, an ideal scenario was a pre-screening or fraud prevention solution that had built-in AML checks that would run in the background. “At the same time, we wanted a multinational system with high accuracy in filtering user registrations into three categories: accepted, declined, or requiring extra manual due diligence,” added Paweł Karczewski. The Solution Rebell Pay is consistently on a mission to improve and advance cashless payment systems. With the goal to collect and verify vast amounts of data more efficiently, this also meant creating a more streamlined onboarding process that doesn’t compromise compliance or user experience. “Because we live in a fast-moving world full of surprises, our mission with Rebell Pay is to make... --- ### Biggest Money Laundering Cases > Money laundering remains a significant issue today, and there have been even larger cases in the past. Check them out. - Published: 2025-02-25 - Modified: 2025-03-13 - URL: https://www.idenfy.com/blog/biggest-money-laundering-cases/ - Categories: Blog Back in the day, almost everybody was involved in money laundering - drug cartels, banks, politicians, and whatnot. Let's see how these schemes were uncovered and exposed, as well as the impact and prevention of one of the world's biggest financial crimes. Money laundering is a financial crime that involves hiding the originality of illegally gained funds. Fraudsters use this process to integrate “dirty money” into legitimate financial systems, making money legal, and so, due to globalization and digital improvements, money laundering schemes are becoming more complex and harder to trace.   Let’s begin by learning what money laundering is, reviewing the biggest money laundering cases worldwide, discussing possible measures to prevent similar occurrences, and familiarizing ourselves with their impact.   What Is Money Laundering?   We talked about money laundering in our first sentence, but one sentence is not enough, right? So, what exactly is it? Money laundering is the act of making illegally obtained money appear legal. How is it done? It usually has three stages:  Placement: Gambling establishments and cash deposits for fraudsters are like an escape to hide illegally gained funds in the financial system.   Layering: Transferring funds using countries and separate accounts to hide funds’ origin.   Integration: Reintroducing the laundered money into the economy, making it appear as though it was earned legitimately.   Nobody was sitting around waiting for some miracle to happen, and governments and financial institutions have implemented Anti-Money Laundering (AML) solutions to prevent this from happening. However, as the following cases show, the most enthusiastic fraudsters can break even the biggest and most anticipated security systems.   The Biggest Money Laundering Cases  As we know, you must be creative to make something big. Money laundering cases are not an exception. They are often as creative as they are illegal, and by examining these cases, we better understand how such schemes operate and impact financial institutions, governments, and societies. Wachovia Bank and the Mexican Drug Cartels  In 2010, Wachovia Bank, a U. S. financial institution, laundered an estimated $350 billion for Mexican drug cartels. The one mistake that the bank made was that they hadn’t implemented strong AML controls, this way allowing criminal organizations to finance their operations, leading to a rise in violence and illegal drug trafficking.   Investigations that were made revealed that drug cartels used the bank’s services to transfer cocaine sales in the United States all the way back to Mexico. This money was often deposited into cash-intensive businesses such as currency exchanges and wired through Wachovia Bank accounts. Wondering what happened next? The case ended with a $160 million penalty - relatively small compared to the scale of the crime.   The Danske Bank Scandal  Between 2007 and 2015, Danske Bank processed approximately $228 billion in suspicious transactions. Most of these funds originated from Russia, and despite the internal warnings, the bank failed to take immediate action.   The money was transferred through a lot of companies and was moved into accounts that did not belong to the residents. Criminals this way were allowed to hide their funds’ destinations and their true origin from where they came from. Such scandal caused many doubts about the bank, finally leading to its downfall of shareholder trust and, in this... --- ### EIN Verification in KYB Compliance [Dos & Don'ts] > Find out how you can check EIN numbers online, what databases are appropriate, and how this is all tied to KYB verification. - Published: 2025-02-14 - Modified: 2025-03-14 - URL: https://www.idenfy.com/blog/ein-verification-in-kyb/ - Categories: Blog, KYB/AML Find out the main factors that make or break an EIN verification process while we provide concrete database examples and spill our industry insights on other mandatory business verification steps in KYB compliance. EIN, or Employer Identification Number, is a form of Tax Identification Number (TIN) issued by the IRS in the US specifically for businesses. EIN is an important data point in Know Your Business (KYB) compliance because it shows that the business is valid and is operating legally. By implementing an EIN verification process during KYB, you check if a business has a valid EIN, which is unique to each business and issued by the IRS for identification and tax reporting purposes.   Just as a Social Security Number (SSN) identifies individuals in the US, an EIN works as a key identifier for businesses. That’s why entities can’t legally hire employees or manage finances without an Employer Identification Number, making it a reliable indicator of a company’s legitimacy. This is an important factor for regulated entities, such as banks or fintechs, since they are required to check and verify all their partners before starting a new business relationship. Verifying another company’s EIN can be useful in any industry; therefore, even if you’re not obligated by law to follow corporate due diligence requirements, you can look through our recommended ways to conduct EIN verification and find out how this sort of background check can benefit your business.   What is an Employer Identification Number (EIN)? An Employer Identification Number (EIN) is a unique nine-digit identifier (XX-XXXXXXX) used in the US for business identification, employment, and tax reporting. Assigned by the IRS, EINs help track company taxes and ensure a business’s legal status. That’s why EINs are mandatory for nearly all businesses if they want to operate legally in the US. Companies can apply for an EIN online through the IRS. This enables them to handle tax obligations, open bank accounts, or apply for credit. For example, US-based businesses need to get an EIN if they: Have employees. Participate in a Keogh plan. Deduct taxes on non-resident alien income. Have links to other companies, such as estates or trusts. Operate as a corporation or partnership. File certain tax returns (in sectors like alcohol, employment, excise, firearms, or tobacco). In the context of KYB compliance and B2B relationships, verifying another company’s EIN helps confirm the business’ legitimacy. EIN verification is conducted during the onboarding process, when a corporate entity, aka a potential business partner or client, needs to provide information. Then, the company’s internal compliance officers are responsible for checking and verifying the information, including the company’s EIN, confirming that the data matches and the company is genuine. They also check for any signs of fraudulent activity, such as deliberately concealing the ownership structure for fraud or money laundering. What is EIN Verification? EIN verification is the process of assessing an EIN number and its legitimacy, typically as part of the bigger KYB background check, which is intended to help determine whether the company that's being verified is operating legally and is compliant. EIN verification, in particular, ensures a business is registered with US tax authorities by confirming that its Employment Identification Number is... --- ### AI in Fraud Prevention > Learn how AI is helping with fraud prevention in businesses and companies all around the world and fighting cyber criminals. - Published: 2025-02-13 - Modified: 2025-03-18 - URL: https://www.idenfy.com/blog/ai-in-fraud-prevention/ - Categories: Blog AI is transforming fraud prevention as we speak with real time detection and adaptive security. It is not a secret that cybercriminals are thinking of new tactics and threats are getting harder to detect, so AI in this case helps businesses and various companies all around the world to stay ahead ahead of the threats. Since the internet was invented, fraud attacks and online scams have increased. In the previous days, fraud was not as complex to do as it is today, and the legacy systems we had were enough to detect it. Now, traditional fraud detection systems are becoming outdated against new fraud methods that cyber criminals can invent.   One of the new systems that we have, and that is advancing every single day, is artificial intelligence (AI), and that is what we will talk about today. But is the AI reliable? Is the AI trustworthy? Is the AI advanced enough to prevent fraud? Let’s find out.   The Evolution of Fraud The digital transformation has changed how businesses operate and how consumers engage with various services that businesses have to offer. However, this change has also opened new ways for fraudsters to get what they want more easily, which is not good for businesses and companies worldwide. From phishing scams and identity theft to the most complex schemes like identity and deepfake fraud, the tactics employed by such individuals have become more harder to detect.   Traditional, legacy systems, which depend on predefined patterns and manual reviews, often struggle to keep pace with these evolving threats, and there are some challenges, like:  High False Positives: Legitimate transactions often get flagged as fraudulent, leading to customer dissatisfaction and manual reviews to be done by the company’s team.   Lack of Adaptability: Fraudsters constantly try to improve their tactics, making regular rules ineffective.   Slow Detection: If the legacy system triggers manual review, it becomes a slow process that delays fraud detection. This way, fraudsters get more time to exploit vulnerabilities.   AI in the Fraud World  Artificial Intelligence changed the landscape of the online and fraud world significantly with its machine learning algorithms to analyze huge datasets in seconds, identifying patterns and unusual behaviors that may indicate fraudulent behavior. Unlike traditional legacy systems, AI models can learn from the new data that they gain from everywhere, including text, voice, images, and videos. This way, they are adapting to fight against fraud tactics in real-time. This continuous learning capability from AI allows organizations to stay ahead of fraudsters, reducing false positives and improving detection accuracy.   Let’s take a look at the financial sector, for example. AI here monitors transaction behaviors and marks unusual transaction patterns - this way, detecting unauthorized activities, and so, by assessing factors such as transaction amounts, frequency of transactions, locations, and even times of transactions, AI systems can identify potential fraud that could happen any moment, this way keeping company and users safe.   Facial Recognition  Facial recognition is one of the AI technologies that has been here for a while. This biometric authentication method analyzes unique facial features to verify an individual’s identity, securing it from identity theft and unauthorized account access.   How Facial Recognition Prevents Fraud:  Account Verification: Face recognition verifies accounts; thus, only legitimate users log in or create accounts.   Transaction Security: High-value transactions... --- ### NIS2 KYC guide for Domain Name Service Providers > Learn about the NIS2 directive and how to effectively utilize KYC and identity verification for domain name service providers. - Published: 2025-02-07 - Modified: 2025-02-07 - URL: https://www.idenfy.com/blog/nis2-kyc-domain-servers/ - Categories: Blog Learn about the NIS2 directive and how to effectively utilize the KYC and identity verification service for domain name service providers based by the rules outlined in Article 28. The NIS2 (Network and Information Systems 2) regulation, implemented by the 27 European countries and adopted in 2022 (after the successor NI2, established in 2016), added new editions, specifically addressing domain name registrars and DNS service providers in October 2024 based on Article 28. Effect of Article 28 on Domain Name Registrars The 28 articles of the NIS2 Directive introduce stricter regulations to enhance the Domain Name System's security, stability, and resilience (DNS). 1. Mandatory Collection of Accurate Domain Data Under NIS2, TLD (Top-Level Domain) registries and domain registration service providers must collect and maintain accurate, complete domain name registration data. This must be done with due diligence, following EU data protection laws when handling personal data. 2. Essential Data Requirements The database of domain registration data must include key information to identify and contact domain holders and administrators: Domain Name Date of Registration Registrant’s Name, Contact Email, and Phone Number Admin Contact Details (if different from the registrant) In the following paragraphs, we will explain why KYC is a perfect fit for this information collection. 3. Verification Procedures Are Mandatory Registries and service providers must have clear verification policies and procedures to maintain data accuracy. These procedures must be: Regularly Updated to reflect the latest compliance standards Publicly Available to ensure transparency in data management This aligns with KYC requirements for ongoing due diligence and risk monitoring. 4. Public Access to Non-Personal Data Non-personal domain registration data must be made publicly accessible without delay after registration. This is particularly useful for KYC solutions that rely on real-time data checks to validate digital identities. 5. Timely Data Disclosure for Legitimate Requests Registries must provide specific domain data upon lawful, substantiated requests from legitimate access seekers (e. g. , regulatory bodies, law enforcement, or KYC providers). Key points include: Response Time: Requests must be answered within 72 hours Transparency: Disclosure policies must be publicly documented 6. No Duplication of Data Collection NIS2 emphasizes efficiency, requiring registries and service providers to cooperate to prevent duplicate data collection. For KYC vendors, this promotes: Streamlined Data Access Improved Data Consistency across verification workflows The KYC requirements for the Domain Name Registrars Since Article 28 of NIS2 stresses data collection and verification, a particular set of measures has to be implemented. Even though the article does not specifically highlight identity verification as part of the customer due diligence procedure, it is still crucial. Domain Name Registrars and DNS service providers need these solutions to follow the compliance requirements correctly:1. Identity verification tools. Identity verification requires capturing the photos of ID documents or passports and optionally matching the selfie with the picture from the document. The verification also extracts and compares the registrant’s name with the data from the document.   2. IP Proxy checks. Since online e-commerce often faces chargeback fraud and domain registration is part of the broader online e-commerce industry, it is practical to verify whether an onboarded customer.   3. Ongoing monitoring. Verifying the identity once and not following up again is... --- ### What is Social Security Number (SSN) Verification? > Explore the most common ways to perform SSN verification, and learn how this process can be used for a compliant KYC check. - Published: 2025-02-05 - Modified: 2025-02-10 - URL: https://www.idenfy.com/blog/ssn-verification/ - Categories: Blog Look through the most commonly used Social Security Number (SSN) verification methods while finding out if it’s a good idea to use a person’s SSN as the only piece of identifying data in your company’s ID verification process. A unique identifying nine-digit number, better known as the person’s SSN or Social Security Number, is widely used in the US for various purposes. Originally designed to track Social Security benefits or one’s work history, it’s now a central data piece used in Know Your Customer (KYC) verification. Providing your SSN is a standard practice in areas where businesses and government authorities need to check official documents containing the SSN for security reasons.   Automatically, this makes SSNs highly personal and sensitive pieces of data, which, unfortunately, can be used for fraudulent purposes. Today, SSNs are among the most attractive data points for fraudsters who are looking to succeed with major crimes, including money laundering, tax evasion, loan fraud or simply synthetic identity fraud, used for processes like opening new bank accounts.   Below, we explore the key challenges in building a KYC process that verifies whether an SSN matches the individual. We’ll also look into the common SSN verification use cases and determine if it’s truly a compliant component for your company’s customer verification process.   What is Social Security Number Verification? Social Security Number (SSN) verification is a process that is designed to check if the provided SSN belongs to the individual who’s completing the identity verification. The goal is to confirm the person’s identity and, on top of that, validate their SSN. Companies often rely on software to perform this check using automated database verification methods. This involves cross-referencing the SSN and personal details, such as name, date of birth, and address, with official government records, like those maintained by the Social Security Administration (SSA). Since many US citizens, permanent and temporary residents, as well as working residents have a Social Security Number, it makes this identifier a good choice for a simple and secure user verification measure. That’s why many US-based businesses and government agencies use it, making it a universal component of their KYC programs, where businesses verify identities to ensure compliance and prevent fraud.   The Importance of SSN Verification Through SSN verification, organizations ensure the user’s SSN is valid and follows the standard nine-digit format. However, SSNs are often coupled with other ID verification methods, especially in regulated industries, where a stricter KYC flow is mandatory. Since many people living in the US have SSNs, for example, paired with biometric verification, this sort of SSN verification completes the general ID verification process, making it a straightforward process from the end user’s perspective. That’s why SSNs serve as important components for verifying identities.   SSN verification also serves as a safeguard from fraud. Since many businesses today work online and are monetized, offering payments and user-friendly transactions, this level of convenience created opportunities for fraudsters to breach systems, steal data, and, for example, open new bank accounts with forged documents or stolen SSNs that actually don’t belong to them. SSNs are also widely exploited for illicit transactions after criminals create synthetic identities, which are created using real and forged data, making them harder to... --- ### SOC 2 vs. ISO 27001: 6 Key Differences > Many companies don't know which to use when choosing between SOC 2 and ISO 27001. Learn about six key differences that will help you decide. - Published: 2025-01-31 - Modified: 2025-02-27 - URL: https://www.idenfy.com/blog/soc-vs-iso/ - Categories: Blog Find out what SOC 2 and ISO 27001 are, how they compare, and what factors should shape your decision when choosing the best option for your company based on criteria like geographic relevance and more. Rarely can businesses be safe from data breaches, ever-changing threats, and significantly raised expectations from regulatory bodies. Working harder to earn and maintain trust is necessary now more than before for an organization. Information security certifications and attestations have increasingly become critical tools here. Two of the most widely recognized are SOC 2 and ISO 27001. Both certifications enable an organization to guard sensitive information, demonstrate responsibility, and handle the question of security governance quite differently. Knowing their differences, strengths, and intended audiences can help organizations in a more appropriate and strategic security program. What is SOC 2? SOC 2, also known as System and Organization Controls 2, was developed by the American Institute of Certified Public Accountants (AICPA), finding its origin to assure customers and regulators worldwide that an organization’s processes and controls meet a minimum of data protection and operational integrity standards. This auditing procedure focuses mainly on nonfinancial controls relevant to information security, privacy, processing integrity, availability, and confidentiality — collectively known as the Trust Services Criteria (TSC). SOC 2 reports are of two types: Type I assesses the design of your controls, which means a snapshot that shows the proper safeguards are in place.   Type II takes one step further by measuring how controls operate in real-time over a set period, generally several months. Many organizations start with a SOC 2 Type I engagement to build preliminary credibility and then pursue a Type II audit to prove operational maturity. What is ISO 27001? ISO 27001 is an international standard and a choice for organizations working globally or serving clients in different regions. A certificate recognized by a reputable certifying body can ease compliance with most kinds of regulations and help third parties ensure that you apply a proven, reliable, evolving standard internationally.   The standard for regulating such controls is through the joint efforts of the industry's prominent and well-recognized organizations: the ISO and the IEC (International Organization for Standardization). ISO 27001 goes beyond focusing on any specific state of controls at a given point and requires establishing a comprehensive Information Security Management System (ISMS). Often, it provides a directly structured blueprint from which organizations can identify their security controls, governance practices, risk management policies, and incident response procedures and continually improve.   An organization can acquire ISO 27001 certification through an accredited certification body. It typically starts with gap analysis, ISMS development, policy and procedure documentation, and internal audits. At the end, an independent auditor performs a two-stage assessment: Stage 1: Reviewing documentation. Stage 2: Verifying the implementation and effectiveness of your ISMS. By being successful, an auditor will provide the organization with an ISO 27001 Certificate valid for three years; regular surveillance audits are necessary to ensure that continuity in improvement and compliance is still here. Key Differences Between SOC 2 and ISO 27001 SOC 2 and ISO 27001 are trust-building and reinforcement strategies in data security, but their methodology differs based on several key areas: 1. Attestation and Certification SOC 2 provides... --- ### How to Prevent Wire Transfer Fraud? [Top 5 Scams] > Access the latest insights on wire transfer fraud, including common scamming techniques, learning how to not get caught in such schemes. - Published: 2025-01-23 - Modified: 2025-02-11 - URL: https://www.idenfy.com/blog/wire-transfer-fraud/ - Categories: Blog Review the most common wire transfer fraud and scam cases, find out how they negatively impact companies and their security system, and what kind of red flags users need to be aware of before giving out their money to unknown individuals on the internet. Contrary to popular belief, wire transfer fraud doesn't necessarily involve actual wire transfers. Such scams are based on various electronic communication forms, such as phone calls, emails, social media, and other messaging apps. They are used to defraud both standard internet users and businesses using fake websites, phishing emails, and other techniques that lure victims into sending fraudsters cash, gift cards, crypto, etc. Some of the popular white-collar crimes, such as insurance fraud or Ponzi schemes, fall under the wire transfer fraud category when they are committed online or by phone. Wire transfer fraud poses a serious risk, leading to bad publicity and customer loss if not addressed. The worst part is that this type of fraud is hard to trace or reverse, making it a “perfect” crime for bad actors looking for quick money in their pockets.   So, what exactly is wire transfer fraud, how does it work, and what steps should you take to prevent it? Find the answers below.   What is Wire Transfer Fraud? Wire transfer fraud is a type of payment fraud where the person is tricked into sending money to a fraudster’s bank account under false pretenses. It can be any scam that uses spoofing or identity theft, relying on electronic communication like phones or the internet to deceive people or companies into sending funds, such as standard online transfers, gift cards, prepaid credit cards, crypto, and any other valuable assets that the fraudster might want to steal for their personal benefit.   Some common examples include bad actors who scam by: Sending fake checks (for example, a cashier's check), and asking to cash it and forward the money to them. Calling from the “IRS” or other official representatives and unexpectedly asking to wire funds (with consequences if you don’t comply). Asking to wire money overseas for some convincing reason, such as a grandchild on vacation or in the military. Criminals who are skilled at wire transfer fraud impersonate figures like government officials, suppliers, and company executives, creating a convincing sense of urgency that pushes their victim to transfer the funds and finalize the “deal. ” This helps fraudsters trick their victims without allowing them actually to think or assess the request on a deeper level.   Other illicit practices, for example, hacking into the person’s email and replicating documents that are later sent from the supposedly the same “real estate agent” to the victim, can be used to change the transfer destination to their fraudster’s account. Criteria for Defining Wire Transfer Fraud Cornell Law defines wire transfer fraud through a checklist of five key elements: The scheme involves a lie or omission. The person participates in a scheme to commit fraud. The person uses a form of communication (phone, email, social media app, etc. ). The use of such communications advances the fraud scheme. The scheme results in financial losses (it can be money, assets, and so on). How Does a Typical Wire Transfer Scam Work? The most common scam linked to... --- ### MLRO Work Responsibilities in 2025 > As fraudulent activities are higher than ever, companies must somehow prevent them. This is where MLRO comes in - find out more about them. - Published: 2025-01-22 - Modified: 2025-02-12 - URL: https://www.idenfy.com/blog/mlro-work-responsibilities-in-2025/ - Categories: Blog Money Laundering Reporting Officers (MLROs) help their companies prevent fraudulent activities, but it is not easy — they face complex challenges. Learn about the daily tasks of an MLRO, their work requirements, and the importance of AML tools. Some may know, and some may not know, what a Money Laundering Reporting Officer (MLRO) is — a complex role that has to help organizations prevent money laundering, fraud, terrorist financing, and other illegal activities that could occur in the companies. So let us cover the most important aspects associated with MLRO to understand it more easily, sit back, relax, and have a good read. What is a Money Laundering Reporting Officer (MLRO)? A Money Laundering Reporting Officer (MLRO) is a senior compliance professional primarily responsible for helping organizations prevent various illegal activities and a primary point of contact for regulatory authorities responsible for ensuring that their company complies with Anti-Money Laundering (AML) regulations. An MLRO not only ensures compliance but also acts as a strategic advisor for a company, helping out regulatory authorities and internal operations. For example, in the UK, the Financial Conduct Authority (FCA) sets various expectations for MLROs, especially with accountability and proactive measures to reduce possible risks. Work Requirements for an MLRO To be successful as a Money Laundering Reporting Officer, one must have several skills that are not easy to acquire — strong analytical skills are a must, as MLROs must be able to process not-so-small amounts of data to identify unusual activities and assess risk accurately. It also requires in-depth legal knowledge to work with constantly changing AML regulations and compliance across jurisdictions. Managing complex compliance systems, often involving new technologies, is also helpful. Excellent communication and leadership skills are equally important, as MLROs must interact with regulatory authorities and guide internal teams. The Expectations of an MLRO in 2025 As financial crimes continue to rise, so do expectations placed on MLROs. In 2025, MLROs are expected to improve by integrating advanced technologies for AML red flags/risks, which could be unusual transaction sizes and sudden changes in transaction frequency, and act accordingly if they occur.   If we would talk about new threats like cryptocurrency-based money laundering and similar cybercrimes — they were in 2024 and are likely to stay in 2025. MLROs must expand to a more complex financial landscape and adopt innovative approaches. A Day in the Life of an MLRO Everybody has a different daily routine with different tasks and responsibilities. Let’s see what a typical day for an MLRO might look like in 2025: Briefing Reviewing reports from automated transaction monitoring systems - systems powered by AI and machine learning flag unusual activities based on predefined rules, such transactions MLRO prioritizes first. Investigations Collaborating with compliance teams to analyze unusual activities and conducting Enhanced Due Diligence (EDD) for high-risk users. Team Training  Conducting various training sessions for employees would help to recognize unusual activities more accurately and report them more efficiently.   Reporting  Preparing and submitting Suspicious Activity Reports to Financial Intelligence Units (FIUs).   This is just a short example of what MLROs' standard day would look like. There are way more activities than these, but these are the main ones. Main Responsibilities of an MLRO  The main... --- ### KYC Remediation > Find out what KYC Remediation means, why it is important for your business, and how it helps you stay safe, compliant, and organized. - Published: 2025-01-20 - Modified: 2025-02-13 - URL: https://www.idenfy.com/blog/kyc-remediation/ - Categories: Blog KYC Remediation - An essential process to ensure your company's safety, stay accurate and compliant with evolving regulations. Learn everything about its importance and what happens if it is ignored. The number of fraud cases and financial crimes in the digital world is increasing, and organizations must solve these issues, maintain their security, and make users’ experiences as smooth as possible. Maybe someone wonders how organizations can do this? One way is to use the Know Your Customer (KYC) process, which helps prevent money laundering, identify users, avoid fraudulent activities, and much more. However, verifying users through KYC alone is not enough. What if their address information changes? What if the data they provided during the onboarding stage becomes outdated after some time? And this is where KYC remediation comes in. Let’s discuss its importance. What is KYC Remediation? First, if we want to talk about remediation, we must get familiar with it. The KYC remediation is a process in which the information collected through KYC is revised from time to time, or if there are any significant life events, to review, search for missing information, update it, and ensure it remains updated for that time. The remediation process includes: Checking and identifying users’ documents that are incomplete, inaccurate, or outdated  Contacting users to check their information and confirm that it is incomplete  Validating and confirming the new data There is more to discuss about remediation processes, so we’ll get back to these later. Why is KYC Remediation Important? Nobody wants to deal with unsafe companies, and remediation should be more than a regular checkbox; it makes the company trustworthy, manages risk easier, and makes it more organizational. If the data about users is inaccurate, it could underestimate the risks and fail to prevent fraudulent activities. In successful organizations, it can’t be an optional part. If your company wants to maintain compliance with the Anti-Money Laundering (AML) directive or General Data Protection Regulation (GDPR) to avoid reputation harm, it is a necessary step to implement KYC remediation. If a user knows about the KYC remediation in the company, it elevates their trust significantly and confidently gives the data to deal with. The correct data reduces inefficiencies caused by checks or miscommunication, streamlines workflows, saves precious time, and offers efficient service to the user. The KYC Remediation Process We have discussed what KYC remediation is before, so let’s get deeper into it. If KYC remediation has a structured approach - we could call it successful. It consists of the following steps: 1. Data Analysis There could be a case where older users have not logged in or made any transactions for a while due to avoiding contact with your company. For example, the user may have found a better one or simply forgot about the one he was using before. The first step in the KYC remediation process begins with identifying inaccuracies and gaps - a broad audit of the existing customer data. The users’ documents are monitored to: Identify old documents  Detect missing or incomplete information  Highlight missing information in the user’s data Organizations must update the regulations with the new data to reflect changes regarding KYC information concerning their... --- ### eIDV: Electronic Identity Verification (Definition, Examples & More) > Learn all about eIDV, or electronic identity verification, and how it combines multiple layers of verification, including database checks. - Published: 2025-01-15 - Modified: 2025-02-12 - URL: https://www.idenfy.com/blog/eidv-electronic-identity-verification/ - Categories: Blog, Identity Verification Learn what eIDV is, where and what kind of industries use this electronic identity verification method, which regulatory frameworks require the 2+2 approach, and how it helps with your company’s risk assessment. eIDV, or electronic identity verification, is the process of verifying a person’s identity using official databases and cross-checking them with personal data, such as their name, address, Social Security Number (SSN), and other details, depending on the business that’s conducting this check. This is a popular Know Your Customer (KYC) verification method, sometimes referred to as Soft KYC or simply database verification.   But what’s so special about eIDV, and will it be the next big thing? We look into this verification process below.   What is Electronic Identity Verification (eIDV)? Electronic identity verification (eIDV) confirms a user’s identity remotely, working as both a verification and security measure in high-risk, regulated industries, such as banking or fintech, where verifying customers is mandatory for a compliant onboarding process. eIDV is an alternative KYC process for the traditional, manual in-person verification: it collects personal information and analyzes the user’s government-issued ID document. However, it’s conducted fully automatically as the user completes the process on their mobile devices.   eIDV is typically powered by AI and plays a key role in a company’s KYC and Anti-Money Laundering (AML) compliance. Financial businesses and other regulated entities use this as a primary identity verification measure during the user’s account opening stage. eIDV is considered to be a more secure KYC measure because it is based on several key data points, providing results instantly, telling whether there’s a match, partial match, or no match with the databases that were used to check the user’s personal data.   Who Uses the eIDV Process? Financial firms and other industries that are regulated and high-risk (in terms of higher chances of money laundering) use eIDV to prevent fraud and comply with KYC/AML requirements.   For example, eIDV is popular among: Banks Accountants Financial advisers Lawers Real estate agents Retailers Crypto exchanges Brokerage firms Government agencies iGaming and casinos E-commerce platforms Recruiters All mentioned entities and other regulated businesses need to verify a client’s identity before establishing a business relationship, ensuring they pose no risks to their organization. For example, a company can’t accept the registration of a sanctioned person or a new customer who tried to bypass the eIDV process with a forged ID document. This aligns with the key goal of KYC compliance.   eIDV and Compliance Requirements  eIDV, in particular, is a compliance process, which is required for three main components: the Customer Identification Program (CIP), Customer Due Diligence (CDD), and ongoing monitoring. KYC requires verification measures, such as eIDV, while CDD measures include different verification and screening processes to maintain accurate customer risk profiles. So, identity verification, or eIDV, is essential for assessing customer risks. This process can also be used as a reverification to maintain ongoing due diligence, depending on the company, its risk appetite, jurisdictional requirements, etc. Coupled with PEPs and sanctions screening (and other AML measures), eIDV is used both during the initial interaction and through ongoing monitoring. For example, investment platforms often use eIDV with passive liveness checks, enabling users to complete... --- ### Tax Avoidance vs Tax Evasion: Legality Aspects & Detection Measures > Learn the legality aspects and key differences between tax avoidance and tax evasion, and find out if it's possible to detect both processes. - Published: 2025-01-02 - Modified: 2025-01-22 - URL: https://www.idenfy.com/blog/tax-avoidance-vs-tax-evasion/ - Categories: Blog Learn about the most common forms of tax avoidance and tax evasion, access the key nuances, and find out how to determine the difference between the two processes, their legality, ethical context, and links to AML/KYB compliance. While both — tax avoidance and tax evasion — sound familiar, there are details that make these terms very different, especially when it comes to law. The tax system relies on voluntary compliance, meaning all taxpayers need to report their income. But complications like hiding income overseas or not reporting income gained from activities like garage sales help evaders reduce their tax bills. To this day, the US remains the leading country for tax evasion.   So, while there are legitimate ways to reduce tax bills by claiming special deductions, people can receive penalties for their unreported earnings, which, unfortunately, also contribute to the success of the underground economy. So, while avoidance is legal and evasion isn't, both processes have their own complex issues, key differences, and legal factors, which we’ll review in this blog post.   What is Tax Avoidance? Tax avoidance is the process of exploiting the tax system, either by a person or a company, to reduce tax liabilities. This is a legal practice that consists of various strategies, such as establishing an offshore company in a tax haven or taking advantage of credits and similar tax deductions. In simple words, it means that you’re paying as little as possible while still staying in line with mandatory legal requirements.   For example, if a family overpaid their taxes and received a refund after filing their return, and the next year, they claimed a deduction for home mortgage interest or credit for childcare expenses to avoid overpaying again, this means this process is tax avoidance, and it’s a lawful practice, which is acceptable. In this case, the family is making a smart financial decision to lower their tax bill legally.   Tax Avoidance Examples  Some people exploit tax rules and their loopholes by using techniques that benefit them but go against the law's intent. These are technicalities in the tax code that legally reduce tax liability. Keep in mind that misusing such loopholes or claiming tax benefits that you’re not eligible for can be considered a crime. These are the common ways individuals and businesses lower their tax bills:  Choosing a certain tax structure. For example, a limited liability corporation (LLC) which allows you to gain tax benefits and avoid double taxation.   Using a tax-deferred account. This means investing in accounts where there isn’t a requirement to pay taxes until you withdraw the funds. For example, retirement accounts can delay taxes on earnings. Benefitting from credits and deductions. Reducing tax income by taking advantage of tax laws that allow you to claim eligible deductions and credits, such as paying a certain amount in mortgage interest and then deducting that amount later from your taxable income.   Using tax-free investments. This means investing in certain types of accounts or securities that are exempt from taxes on their earnings. For example, investing in municipal bonds, earning a certain amount in interest, and not needing to pay taxes on that income. Disguising employment. For example, when someone works the same... --- ### KYC in Traditional Finance (TradFi) > KYC in TradFi - learn everything about its benefits, cons, its impact on operational security and legal compliance. - Published: 2025-01-02 - Modified: 2025-01-06 - URL: https://www.idenfy.com/blog/kyc-in-traditional-finance/ - Categories: Blog KYC is one of the most important tools for fraud prevention, AML compliance, and risk management in TradFi; however, increasing compliance costs, outdated systems, and cross-jurisdictional regulations create significant challenges. Learn how you can overcome them. The concept of Know Your Customer (KYC) has become central in the traditional financial world, turning it into a primary tool that could help reduce possible fraud and money laundering. Necessary KYC protocols are increasingly complex and expensive to maintain, particularly in a globalized environment with everything digital. Financial Institutions must manage regulatory requirements, balance customer experience, and leverage technological advances to stay efficient.  The blog post highlights some of the key things of KYC in TradFi, the role of new technologies, and the regulatory landscape. What is TradFi? Traditional Finance (TradFi) refers to a conventional financial system consisting of established institutions like banks, credit unions, insurance providers, and stock exchanges that facilitate lending, investment, and wealth management services. Founded on the bedrock of regulatory frameworks and operating on centralized lines, TradFi is all about compliance, stability, and protection of consumer interests. Examples of traditional finance include JPMorgan Chase, Bank of America, and the London Stock Exchange. In the context of cryptocurrency, TradFi can interface with the crypto ecosystem through custody, trading infrastructure, or through partnerships with fintech companies. Adaptation from traditional financial institutions with the crypto space has been seen in instances such as Goldman Sachs offering Bitcoin derivatives and partnerships such as Visa partnering with crypto wallets for payments. The efforts mentioned above show how the TradFi institutions are bridging the gap with DeFi (Decentralized Finance) within a context of innovation in blockchain and a more traditional concept of financial regulation. TradFi vs DeFi Traditional Finance (TradFi) and Decentralized Finance (DeFi) represent two distinct approaches to financial systems, each with its own strengths and weaknesses. Here are some key differences: Regulatory Framework TradFi: Bound by tight regulatory frameworks to facilitate stability, user protection, and risk management; regulated by SEC or FCA. DeFi: Unregulated or self-regulated. This way promotes innovation at the cost of security, fraud, and consumer safeguards. Accessibility TradFi: Access to an open banking system and credit history is required, often excluding underbanked populations; services are usually location-based and intermediary-reliant. DeFi: Open to everyone who has access to the internet and a crypto wallet, opening the way for financial institutions and making it more accessible worldwide. Transparency TradFi: Operates on private, proprietary systems with limited public access to financial operations and decision-making processes. DeFi: Built on public blockchains, ensures the transparency of transactions and protocols, where anyone can verify activities performed. Speed and cost TradFi: Transactions, particularly cross-border ones, can take up to several weeks, which is slower and more expensive because of the many intermediaries and their legacy systems. DeFi: Utilizes blockchain technology, allowing for faster and cheaper transfers, although more network congestion can increase the fees. What is KYC? Know Your Customer (KYC) is a financial compliance process that aims to verify a customer's identity against criminal activities like money laundering and fraud. The so-called KYC processes allow businesses to deal with actual and rightful individuals or entities by collecting and verifying personal details, including IDs and proof of address. Tied initially to TradFi, in... --- ### How Fraudsters Continue to Succeed with Multi-Accounting in 2025 > Learn why some cases of multi-accounting are more serious than others while reviewing solutions that can help identify this illicit practice. - Published: 2025-01-02 - Modified: 2025-01-03 - URL: https://www.idenfy.com/blog/multi-accounting/ - Categories: Blog Access the latest information on multi-accounting and find out how fraudsters juggle this tactic in different industries. Creating accounts is convenient and simple online. Whether it’s a standard email account or a new profile on a marketplace, without stricter security measures like identity verification, it takes less than a minute. Some users create multiple accounts accidentally when they forget their original credentials — others get involved in multi-accounting on purpose to access new user benefits, such as promotional bonuses and discounts.   Multi-accounting isn’t necessarily fraud unless it’s later used as a way to commit crimes. However, it’s often against the company’s rules outlined in the Terms and Conditions, which prohibit using multiple accounts. This practice has been a popular tactic for bonus abuse in iGaming and other industries, raising security concerns for businesses.   We explore why users might find it beneficial to create multiple accounts and the key ways how to prevent this deceptive practice below.   What is Multi-Accounting? Multi-accounting is the practice of creating different accounts within the same service under different identities. This approach helps the user to evade detection and engage in prohibited activities, such as avoiding being banned on the original account or accessing first-time-only account bonuses. Even though it might appear a harmless act, in the context of online platforms, multi-accounting is tightly linked to fraud.   This practice is also popular on social media sites when users have at least two accounts (for example, one public and one private account). Multiple accounts are also used when running ads. However, when it comes to fraud and multi-accounting, users often exploit this practice to access free trials or discount codes repeatedly. In sports betting, multi-accounting is extremely popular nowadays as a way to claim welcome bonuses.   The issue is that with guided YouTube videos, ChatGPT, or detailed tips in forums, users circumvent the rules and can create multiple accounts more easily. Companies that prohibit multi-accounting often have in-house Trust and Safety teams or use special software to monitor user behavior and spot red flags. Multiple accounts (profiles accessed from the same device or those that share the same IP, etc. ) should be treated as one as well.   What is Multi-Accounting Used For? There are various use cases for multi-accounting. For example, people use multiple accounts for: Bypassing regional restrictions. If some age-restricted services, such as adult content platforms or gambling sites, are illegal in a certain country, the user can create multiple accounts using VPNs and try to bypass such a ban.   Bonus hunting. Popular on platforms like online casinos and betting, users create multiple accounts and digital personas to bypass checks and access new-user benefits without getting banned.   Arbitrage betting. This involves creating multiple accounts to place bets simultaneously, calculate the outcomes, and win no matter if the odds change. In case the primary account gets blocked, another one is used. Matched betting. This is a similar process in iGaming but involves using free bets to beat the odds. The winnings can be boosted when the user creates multiple accounts. Users create such fake... --- ### Cryptocurrency Regulations Around the World > Cryptocurrency regulations are being implemented all around the world, iDenfy explains about these policies from various frameworks to taxes. - Published: 2024-12-30 - Modified: 2025-01-06 - URL: https://www.idenfy.com/blog/cryptocurrency-regulations-around-the-world/ - Categories: Blog Cryptocurrency regulations are constantly developing as governments worldwide try to balance a fine line between allowing innovation to take root and protect customers. The cryptocurrency regulatory landscape differs across Europe, the United States, Asia, the Middle East, and other regions. From a rare and unknown thing to currently being one of the mainstream financial assets, cryptocurrency has dragged the regulations attention of governments in several states in different parts of the world. Some policies offer a balance between innovation and security needed to guarantee that specific regulations must realize blockchain benefits without sacrificing financial stability or users’ protection. In this blog post, we will travel around the world and discuss critical aspects of cryptocurrency regulatory mechanisms currently or soon to be active across various countries and regions. The FATF’s Stand on Global Cryptocurrency Regulations The Financial Action Task Force (FATF) is an international body tasked with combating money laundering and terrorist financing, which has been very active in cryptocurrency regulation; one of the key features of the FATF approach so far has been a thing called the Travel Rule. It requires Virtual Asset Service Providers (VASPs) to share information on the originators and beneficiaries of crypto transactions. What was initially required for traditional financial institutions is now tied upon VASPs worldwide to ensure transparency and prevent illicit activities. Some key requirements include: VASPs must collect and transmit information on transactions above the threshold for cryptocurrencies.   The information to be provided includes the name, address, and more detailed account info of the originator and beneficiary to prevent anonymity, usually attributed to virtual asset transfers. This FATF push for adopting the Travel Rule by member countries further shows its commitment toward including cryptocurrency activities under the large umbrella of Anti-Money Laundering (AML) measures. Many jurisdictions are also aligning their laws to the FATF Travel Rule recommendations, a view on compliance remains challenging for various reasons, such as technical limitations and increased growth in the crypto industry. This rule implemented among VASPs is critical in developing a harmonized global system for AML within the cryptocurrency sector that will mitigate financial crime risks while allowing broader trust and legitimacy in virtual asset transfers. Related: What is the Crypto Travel Rule? An Overview Europe and MiCA: Clarity on Crypto Regulations Europe has been one of the leading players in developing a broad cryptocurrency regulatory framework. In 2023, the European Union adopted Markets in Crypto-Assets or MiCA, the regulation's first large-scale attempt to establish one set of rules that crypto assets should follow. It is supposed to help MiCA implement rules across EU countries, reducing business uncertainty while protecting customers. MiCA aims to classify crypto assets and define what they are, offer consumer protection, and ensure that all crypto service providers are registered and subject to monitoring. This stance from the EU has gained momentum, creating a platform for various member states to participate - some essential elements under MiCA will be the classification of assets such as utility tokens, stablecoins, etc. , their regulation, and strict boundaries on how Initial Coin Offerings (ICOs) should work. As MiCA was drafting the framework, it was designed to avoid repeating past incidents like a TerraUSD collapse (what a wild period of time). While MiCA brings clarity, it... --- ### Refund Fraud: Definition, Key Types & Ways to Stop It > Find out how criminals defraud major online stores and marketplaces by abusing return policies and mastering different refund fraud methods. - Published: 2024-12-18 - Modified: 2025-01-07 - URL: https://www.idenfy.com/blog/refund-fraud/ - Categories: Blog Learn why scamming away and abusing return policies remains a serious threat to various e-commerce marketplaces and access key solutions explaining how businesses should respond to refund fraud. While some e-commerce platforms or marketplaces seem to be thriving and multiplying their revenue by the minute, it’s not all fun and games, especially when we’re talking about fraud. Around 10% of returned items from online shopping sites are linked to some sort of fraud. For example, using stolen credit cards, taking over accounts, or engaging in return fraud are very common.   What’s worse is that, unlike illicit practices like phishing or friendly fraud, return policy scams happen after the customer makes a purchase, making them harder for online merchants to detect and manage. So, to this day, some companies find it challenging to eliminate refund fraud in real-time, especially since certain mandatory factors – such as return policies – need to be in place to keep customers happy and engaged. This is vital to scale and maintain sustainable business practices. But is there really a way to stop this?   RegTech service providers argue that the anonymous nature of online shopping has left a huge loophole, which can be easily managed with a single process: identity verification during checkout or before confirming a customer’s refund to prevent multiple fraudulent accounts, false identities, and repeated offenders.   To minimize financial losses to refund fraud and maintain trust among customers, purchasing goods shouldn't only be a simple and frictionless experience for the customer. Businesses should have a clear strategy for fraud prevention, including transparent internal policies.   What else? We break it down for you below.   What is Refund Fraud?   Refund fraud, also known as refund abuse, is a fraudulent act when a person or a group of bad actors exploit an online shop’s return policy and falsely claim a refund. The goal is to trick the business into issuing them compensation for expenses that the fraudster never incurred. This way, criminals can keep the money and the products. Often, criminals lie that their purchase wasn’t “as described” or that it was “incomplete/unsatisfactory. ” Criminals succeed with this type of fraud by: Falsely reporting an issue with a received product or service.   Deceiving a marketplace into refunding money for a product or service that wasn’t even purchased. An example of refund fraud is when someone buys an item, breaks it, and returns it for a refund, falsely stating that it was already damaged when it arrived. Another standard scenario in a traditional retail world is when a customer shoplifts an item and then returns it to the store, claiming that they simply changed their mind and want to return the item and get their money back.   The Difference Between Refund Fraud and Return Fraud  Both are two types of fraud that are common in e-commerce as a way to exploit store policies. However, the main difference between refund fraud and return fraud is what happens to the items. Return fraud often involves physically returning the products, while refund fraud is designed to manipulate and defraud the merchant without necessarily returning any goods (including other alternatives, such... --- ### KYC in the Metaverse: Trust in a Virtual World > Metaverse - exciting digital world but it is nothing without KYC, iDenfy explains everything you need to know about KYC in Metaverse. - Published: 2024-12-18 - Modified: 2025-01-07 - URL: https://www.idenfy.com/blog/kyc-in-metaverse/ - Categories: Blog The metaverse is revolutionizing how we connect, work, and even do business - a path that holds incredible opportunities and enormous challenges in security and trust among users. Know Your Client (KYC) processes are key to preventing fraud and building trust in a virtual environment that supports safe interactions and growth. The metaverse - a digital world that blends physical and virtual realities - is transforming how we work, connect, and do business online. With all the excitement comes real challenges, like keeping our identities and assets secure and, most importantly - earning users’ trust. There is a way to address these issues in the metaverse, and it is through Know Your Customer (KYC), a reliable and fast process that checks user identities to prevent financial crimes and keep the system safe. So, why is KYC so important for the metaverse? Let's discuss why it matters, its difficulties, and how organizations can implement solid KYC practices.   What is the Metaverse, and Why Does KYC Matter? The metaverse is a substantial digital domain into which users can enter with their avatars and conduct multiple activities, such as socializing, playing games, shopping, attending work, and with the help of Virtual Reality (VR), Augmented Reality (AR), and blockchain technologies, it offers new features and opportunities for citizens and companies to engage in all kinds of digital interactions. Major corporations are investing billions in developing their metaverse presence, fully realizing its potential to transform digital experiences. Most transactions within the metaverse involve digital assets or some cryptocurrencies, so it makes the virtual worlds more vulnerable and increases illegal activities, as well as making virtual worlds an easy target for cybercriminals. KYC protocols are in place to identify and verify users so they can be assured that people are who they say they are by stopping fraudsters from the system and creating a much safer and more trustworthy environment for all participants. Challenges of Implementing KYC in the Metaverse Implementing KYC in the metaverse is hard due to its focus on user anonymity, various decentralized systems, and changing regulations. Here are some key challenges while implementing effective KYC in this virtual world: Pseudonymity and User Privacy The metaverse is built on the idea of anonymity and pseudonymity; people love the freedom of exploring virtual worlds without revealing their real identities, but there’s one tricky part: applying KYC protocols requires users to verify who they are to prevent fraud and finding the right balance between privacy and security, and it isn’t that easy. Metaverse platforms must determine how to respect user privacy while ensuring proper verification. Decentralized Systems Many metaverse platforms run on decentralized networks, a big part of blockchain technology’s work. Because these networks are decentralized, making a single KYC standard is challenging. Instead of having one central authority in charge of KYC, users may have to deal with different verification protocols depending on their platform. Regulatory Uncertainty The metaverse is still pretty new, and regulations haven’t entirely caught up with how fast it’s growing. Many places don’t yet have specific virtual spaces or rules for digital assets. This gray area makes it challenging for businesses to follow KYC regulations to figure out this landscape. The lack of clear guidelines can lead to inconsistent implementation and confuse users. Technological Integration Bringing KYC into immersive, fun,... --- ### Beneficial Ownership Information (BOI) Reporting [Guide] > Access the main details about Beneficial Ownership Information (BOI) reporting requirements and FinCEN's stand on this new rule. - Published: 2024-12-16 - Modified: 2025-01-08 - URL: https://www.idenfy.com/blog/beneficial-ownership-information/ - Categories: Blog, Regulations by Country Access the latest news and summarized takeaways regarding FinCEN’s Beneficial Ownership (BOI) Reporting rule: which entities need to comply and what exact steps reporting companies need to take right now. The Anti-Money Laundering Act of 2020 (AMLA) marks one of the most significant updates to US AML compliance since the Patriot Act. Introduced in 2021, it modernized the framework by amending the Bank Secrecy Act (BSA) and incorporating the Corporate Transparency Act (CTA). The Financial Crimes Enforcement Network (FinCEN), a bureau of the US Department of the Treasury, finalized a rule mandating the reporting of Beneficial Ownership Information (BOI) under the CTA.   Currently, regulated entities are required to disclose beneficial owners or all individuals who directly or indirectly have control over an entity, meaning they own or control at least 25% of the company’s ownership interests. This new rule was introduced to help combat money laundering and other possible financial crimes due to regulatory loopholes. Ultimately, the Beneficial Ownership Information reporting rule targets issues such as opaque ownership structures and the misuse of entities like corporations and LLCs, often exploited for fraud and laundering money through shell companies. Key facts to remember: Data. Collecting and verifying details such as legal names, tax ID numbers, addresses, and government-issued identity documents for the business and its beneficial owners is required for BOI reporting.   Scope. Companies in the US created or registered after 2024 must report beneficial ownership information.   Deadline.  Existing companies must file BOI by January 1, 2025. New businesses are required to comply 90 days from their creation date. In case of lawsuits and other changes that could affect this regulation, visit FinCEN’s website. In this blog post, we’ll review the key requirements of BOI reporting and what it means for regulated entities that need to follow FinCEN’s rules to stay compliant.   What is Beneficial Ownership Information? Beneficial Ownership Information (BOI) is a set of data that consists of individuals who directly or indirectly own or control a company. Identifying and verifying beneficial owners is a mandatory requirement to help companies understand who they’re doing business with. It also assists in defining Anti-Money Laundering (AML) risks and tailoring decisions based on the company’s risk tolerance.   BOI helps companies: Maintain trusted, transparent business relationships with genuine businesses and their owners. Understand AML risks better and identify factors like high-risk jurisdictions (with higher rates of money laundering) or high-risk individuals, such as Politically Exposed Persons (PEPs) or sanctioned individuals.   Monitor companies and apply proper due diligence measures while detecting entities that fall outside of the business’ risk tolerance (so that the business relationship can be ended). The BOI reporting rule requires that companies disclose this information, including the identity of beneficial owners or simply people behind the company. This is also part of the Know Your Business (KYB) framework, which requires you to assess and verify another company’s ownership structure before entering a new business relationship. BOI is important because it improves transparency and focuses on minimizing fraud on a bigger scale (instead of just focusing on individual clients).   What is a Beneficial Owner? A beneficial owner is an individual who holds a stake in a... --- ### How to Check if a Business is in Good Standing > Learn what compliance requirements are needed to maintain in good standing and how to check if other businesses have this certificate. - Published: 2024-12-11 - Modified: 2025-01-08 - URL: https://www.idenfy.com/blog/check-if-a-business-is-in-good-standing/ - Categories: Blog Learn why you need to know if a business is in good standing, what happens in the case of non-compliance, and why certain risk factors, like onboarding a Politically Exposed Person (PEP), come with certain risks that can potentially harm your company. Companies that want to maintain their good standing status and comply with various financial requirements must stay current with state reports, pay fees and taxes, and be legally registered in their jurisdiction. So, in other words, a certificate of good standing helps you verify if the other business is legitimate. It confirms that the company is compliant and legally registered with the state. At first glance, checking if another company is in good standing is simple. All you need to do is visit a website and search for the name. However, having this status doesn’t mean that the business is risk-free. That’s why additional Know Your Business (KYB) checks are vital when starting a new business relationship. This sort of background check helps find adverse media, Politically Exposed Person (PEP) statuses and other vital information that you need to comply with anti-money laundering (AML) requirements. For that, financial institutions and other regulated businesses need to follow the risk-based approach, asking the ultimate question of whether it’s the right move to onboard this business and start the partnership.   In this blog post, we explain how to check another business’ status, what it means if the company is in “good standing,” and what extra requirements and risks you need to know when verifying corporate clients.   What Does “Good Standing” Mean? If an entity is in good standing, that means it has paid all necessary fees and filed the required reports to the relevant authorities. A good standing includes filing paperwork and consistently meeting compliance requirements, such as retaining documents and meeting financial obligations, including paying taxes on time. This status confirms that the entity exists and that it can legally do business in the state.   Having a certificate of good standing is important because it: Verifies that the business is legally registered with the state.   Confirms that the business is compliant and active.   Shows their financial health and that the company is prepared to legally open a business bank account, obtain a loan, etc. (otherwise, lenders often don’t engage with the entity). Larger companies like limited liability companies (LLCs), corporations and any entities formed in a state or registered as foreign entities in that state can request a certificate of good standing. Despite that, this status isn’t the same as having an occupational or business license, which is also often a legal requirement for companies to stay compliant. That means there are cases when the business can work legally without having a certificate of good standing.   Examples When a Business is not “In Good Standing” If the company fails to meet at least one of the regulatory requirements, that means they failed to meet proper registration rules and are not in good standing. For example, in certain states, businesses can lose their good standing if they don’t pay the franchise tax on time.   Another example is when the company relocates without notifying the Secretary of State and, as a result, fails to file the annual... --- ### Understanding KYC and MiCA > Learn about EU adopted regulatory framework of Markets in Crypto-Assets Regulation - MiCA. iDenfy explains full KYC compliance guide. - Published: 2024-12-11 - Modified: 2025-01-09 - URL: https://www.idenfy.com/blog/understanding-kyc-and-mica/ - Categories: Blog The recent boom in the cryptocurrency market has raised the need for a solid regulatory framework to guarantee users' transparency, safety, and protection; the European Union has adopted the Markets in Crypto-Assets Regulation (MiCA) to offer a meaningful legal framework for crypto-assets issued within its borders. Among the essential elements introduced by MiCA is a strict Know Your Customer (KYC) policy and procedures to reduce the risk of money laundering, fraud, and other illicit activities. The EU adopted the regulatory framework of Markets in Crypto-Assets Regulation (MiCA), which provided a clear and complete legal framework for crypto-assets and related services. The MiCA regulation aims to establish a regime across EU member states to establish a unified digital finance market environment.   Adopted in June 2023, MiCA seeks to provide clarity for crypto-asset issuers and service providers by offering various definitions and rules. It also includes various digital assets: asset-referenced tokens, e-money tokens, and other crypto assets not covered by previous financial regulations. As a catch-all, this regulation protects users and provides transparency regarding legal certainty, market integrity, and innovation in the ever-growing crypto market. What is Markets in Crypto-Assets Regulation (MiCA)? The fundamental principles of MiCA include mitigating risks for investors, financial stability, and promoting innovation, achieved by considering such important areas: Consumer and investor protection: MiCA wants to protect consumers against financial loss, fraud, and other risks concerning the usage of crypto assets; clear disclosure and enough information about the nature of crypto assets are laid down by the MiCA to give consumers the necessary knowledge to make good choices. Legal certainty: MiCA explains, once and for all, the exact definition of various types of crypto-assets and brings certainty to rules concerning their issuance and trading, thus providing legal certainty to the participants in the industry. This lack of ambiguity existed only in different jurisdictions.   Counteracting market abuse: MiCA provides provisions against market manipulation, insider trading, and other similar practices that may affect the crypto market. The users in this market will be obliged to behave correctly and be punished for unethical behavior. Support for innovation: MiCA seeks to drive innovation by providing one single regulatory framework within which crypto businesses will be free to operate rather than facing conflicting rules from different jurisdictions. This regulatory clarity incentivizes FinTech companies and projects using blockchain to start up and scale in the European market. The Role of KYC in MiCA An essential factor of MiCA’s framework is the focus on proper KYC implementation. Know Your Customer (KYC) is a process that verifies clients to prevent various crimes like money laundering, fraud, and other similar crimes.   Under MiCA, crypto-asset issuers and traders must be subject to implementing a KYC process. It applies to:  Crypto-asset service providers (CASPs) Wallet providers Crypto-trading platforms Cryptocurrency exchanges Crypto-asset advising companies and crypto-portfolio managers The KYC requirements would set up transparency and accountability and prevent illicit activities in the digital finance ecosystem. These measures involve service providers obtaining and confirming information from their clients, such as IDs and information about their business activities. MiCA seeks to create an open yet secure crypto-asset ecosystem in which trust is strengthened among participants. At the same time, criminal activities are discouraged, which has defined the narrative around cryptocurrencies in recent years. Implementing KYC is both an opportunity and a challenge for crypto businesses; an improved KYC mechanism means better security and lower risks for providers and users but at higher compliance costs... --- ### Responsible Gaming: Does this Concept Actually Work? > Responsible gaming measures seem pretty straightforward, but in practice, gambling platforms still struggle with certain measures. Learn why. - Published: 2024-12-01 - Modified: 2024-12-02 - URL: https://www.idenfy.com/blog/responsible-gaming/ - Categories: Blog Access the latest insights on responsible gaming practices, how they look on different gaming and gambling sites, why some platforms ask their users to provide IDs, and how to strengthen age verification measures to stay compliant with stricter regulatory rules. Gaming, also known as gambling, or in the digital space iGaming, is spread like wildfire across multiple regions, especially for platforms such as online casinos, sports betting sites, and similar establishments. With a level of convenience like this, players around the world can access their beloved games without stepping a foot outside. While this is beneficial for the player, at some point, with time, gamers can develop poor habits, leading to irresponsible gaming practices.   To prevent such consequences, gaming operators have strict, responsible gaming policies so that their services can represent a fun and enjoyable experience. In most countries, implementing responsible gaming practices is mandatory. That means if gaming operators don’t comply, they face huge fines and can get backlash real quickly due to maintaining an unethical environment. And this is no surprise, as online casinos, similar to fintech platforms, are already under the radar due to being high-risk, highly-regulated sectors due to increased money laundering and terrorism financing risks.   That’s why gambling businesses and iGaming platforms need to follow Anti-Money Laundering (AML) procedures and implement proper identity verification checks while showing strong social responsibility in order not to let self-excluded individuals or blacklisted gamers play.   But what does it look like in practice, and is this really an achievable goal? We provide some expert insights and explain from the RegTech perspective below. What is Responsible Gaming? Responsible gaming refers to practices that promote safer gambling and raise awareness in casinos, betting, iGaming, and similar industries. These measures protect both operators and players by fostering a fair, transparent, and secure gaming environment while addressing problem gambling.   Ultimately, responsible gaming revolved around two goals: Helping better understand and manage gambling risks while encouraging healthy and secure gaming habits. Enabling players to gamble in a way that doesn't overpower their daily lives or pose any potential harm. “Never gamble more than you can afford to lose” is the golden rule for the player. However, the reality is that gaming platforms attract all sorts of individuals, including those who are more likely to develop an addiction. For this reason, proper responsible gaming measures are vital. They promote fair and enjoyable gaming while safeguarding vulnerable players from potential harm. Why is Responsible Gaming Important? Prioritizing trust and responsibility in the gaming sector leads to better scaling opportunities. In general, if you want to succeed with a business, you’ll probably need to go all in. For iGaming platforms this means ensuring ongoing compliance — using Know Your Customer (KYC) measures and age verification processes that check the user’s age and identity before flashing the green light of approval. Without these processes and responsible gaming measures, there’s no sustainability in terms of maintaining healthy, long-term engagement with the platform users. Responsible gaming includes measures like: Preventing minors from accessing platforms Providing resources on gambling addiction Setting time and financial limits In general, responsible gaming is important because it helps ensure that gaming remains a form of entertainment while preventing minors and other... --- ### KYC Risk Assessment: Automation Rules & Key Risk Factors to Consider > KYC risk rating or KYC risk assessment is one of the first steps in the company's AML risk assessment and due diligence processes. Learn why. - Published: 2024-11-30 - Modified: 2024-12-03 - URL: https://www.idenfy.com/blog/kyc-risk-assessment/ - Categories: Blog Explore the main risk factors, the complexity behind implementing a risk-based approach, and how to identify high-risk factors quickly. We provide a step-by-step explanation of how to set up an effective KYC risk assessment flow using automation. Know Your Customer (KYC) is part of a bigger Anti-Money Laundering (AML) framework that consists of multiple processes, such as customer due diligence (CDD) measures and customer or company-wide risk assessments. This is part of the risk-based approach (RBA) to AML compliance — a mandatory process designed to assess different types of risks, such as internal AML risks linked to the company and user-centered risk factors when onboarding new customers. Accepting at least one suspicious customer without additional checks or letting a flagged transaction slide means that you’re putting everything on the table and playing with fire in terms of your company’s reputation and customer trust.   There are many nuances since the same level of due diligence can’t be applied to all customers. Low-risk ones will go through a less cumbersome onboarding process, while high-risk customers will always need to go through a more intensive flow and additional checks. That means you have to customize your AML processes according to the risk level. However, the most important part is that the risk-based approach is continuous risk assessment and ongoing monitoring. Risk levels change over time, and even the most unsuspicious customers can develop fraudulent tendencies.   So, in this blog post, we’ll review the KYC risk assessment process, breaking it down into the key steps and ways where automating this process might benefit you.   How Does the KYC Risk Assessment Process Work? KYC risk assessment is a compliance procedure and a fraud prevention measure used by regulated entities, such as banks and other financial institutions, designed to evaluate money laundering risks linked to each customer. It involves assigning risk scores — low, medium, or high — based on the customer's potential risk level.   In general, it involves three key steps:  1. Data Collection Often, the process starts by collecting the customer’s identity data, such as their name, date of birth, and address. This can be done using different KYC verification methods but often involves asking the customer to upload their government-issued ID document (passport, driver’s license, or ID card). Sometimes, this method is combined with biometric authentication or selfie verification, where the customer needs to follow instructions and have their face scanned by the software so that it can match their facial biometrics with the photo on their provided ID document.   2. Analysis  Then, the company needs to assess other important data points, such as their business activities, account type, and transaction history. This procedure is often referred to as the bank verification process. It confirms whether a user’s bank account is valid and truly belongs to the rightful owner. It also ensures the account is active, matches the user claiming ownership, and helps businesses comply with KYC requirements. 3. Verification Based on the analysis, customers are given a risk score, also known as a risk rating, from low to high. It serves as a tool to know how to react and what the next steps for the customer will be. At this point, multiple documents,... --- ### The 6th Anti-Money Laundering Directive (6AMLD) [Simple Explanation] > Access this ready-made guide on the 6th Anti-Money Laundering Directive (6AMLD), featuring FAQs and key AML compliance process examples. - Published: 2024-11-27 - Modified: 2024-12-04 - URL: https://www.idenfy.com/blog/anti-money-laundering-directive-6amld/ - Categories: Blog, Regulations by Country Look through the recent amendments in the EU regulatory landscape, including important factors like systemized sanctions, tougher punishments, stricter rules on corporate compliance, and all things linked to money laundering controls and the 6th Anti-Money Laundering Directive, or 6AMLD. Since its implementation in 2021, the EU’s Sixth Anti-Money Laundering Directive (6AMLD) has been helping regulated entities close loopholes that the Fourth and Fifth Anti-Money Laundering Directives (AMLDs) left, focusing more on weak spots that criminals exploited. To this day, 6AMLD serves as the foundational regulatory framework that holds power towards the key anti-money laundering and terrorist financing laws in Europe.   The Sixth Anti-Money Laundering Directive is important because it adds more to the existing AML compliance processes by addressing important risks and new offenses, such as environmental crimes, cybercrime, aiding and abetting, and strictly categorizing them as money laundering crimes. Other important new rules shift to ultimate beneficial owners (UBOs), corporate compliance and cross-border transactions, and in general, stricter Know Your Business (KYB) requirements.   So, why is 6AMLD revolutionary, and how does it help safeguard the integrity of the financial system — read the blog post to find out.   What is 6AMLD? 6AMLD, or the Sixth Anti-Money Laundering Directive (2018/1673), is the latest Anti-Money Laundering (AML) Directive, which works as a building block for companies in the EU for setting AML/CTF standards and stricter processes aimed at combatting financial crime. With the new developments, 6AMLD introduced new money laundering crime categories and increased the responsibility and non-compliance fines for regulated entities.   The key objectives of 6AMLD are: Strengthening the rules and regulations for financial institutions and authorities to combat money laundering and terrorist financing.   Expanding existing AML/CTF rules without fundamentally altering current EU criminal laws while also improving collaboration between member states. Businesses operating in the EU and those outside that work with the EU market must comply with the Sixth Anti-Money Laundering Directive and implement required procedures, such as applying the risk-based approach to AML, implementing due diligence measures, or ensuring ongoing monitoring. What is the Scope of 6AMLD? The Sixth Anti-Money Laundering Directive standardizes money laundering offense categories and definitions (for example, aiding, abetting, or inciting). This is important, as previously, EU regulations focused only on those individuals who directly profited from money laundering activities. However, with the implementation of 6AMLD, all enablers and parties are legally accountable.   The directive broadens its scope to include anyone assisting money launderers or "aiding and abetting," making them guilty of money laundering offenses. This expanded definition also covers those who attempt or encourage money laundering. Helping or even preparing to commit a crime are also considered criminal acts and can lead to punishment. In general, the Sixth Anti-Money Laundering Directive covers three key elements: Engaging in criminal activities and using prevention methods to stop the laundering of proceeds. Categorizing different money laundering techniques and ways to obtain goods illegally as clearly defined crimes. Focusing on identifying and preventing acquiring property through illegal means. These key areas and stricter regulation terms all come with the single goal of helping member states standardize AML/CFT regulations and prevent financial crime altogether.   Stricter Rules Regarding Criminal Liability Previously, only individuals could be held accountable for money laundering,... --- ### Proof of Income: Top 10 Document Types [& Verification Tips] > Learn the key types of proof of income documents and find out use cases with explanations o why you should provide data about your finances. - Published: 2024-11-21 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/proof-of-income/ - Categories: Blog Look through the main proof of income practices, document types, industries that use such documents for verification, and how this process works in the context of compliance and fraud prevention. If you’re thinking of applying for a loan or a mortgage, you’ve probably already heard about proof of income, a key security process for verifying a person’s or another business’ source of funds. In other words, as an applicant, you need to demonstrate that you have enough income to meet your future obligations and repay the loan — otherwise, you’re rejected.   From a financial institution’s perspective, checking proof of income means approving a legitimate transaction and starting a business relationship with a transparent and trustworthy entity. And, when another business is asked to provide proof of income, that means they will need to show their tax returns, cash flow statements, and other official financial documents.   Proof of income is also required before high-risk situations, such as a high-value transaction, as a measure of Enhanced Due Diligence (EDD). So, it all boils down to the particular use case or transaction and status (if they’re a business, an employee, or perhaps a self-employed person). For example, it can be a simple rental agreement or an application for a government assistance program.   In this blog post, we talk about more use case examples, the types of different proof of income documents, and what role financial institutions have in this context.   What is Proof of Income? Proof of income is a verification process where a set of documents needs to be checked to verify a person’s or a company’s earnings over a specific period of time. Banks, lenders, landlords and other companies with money flow use this method to verify one’s ability to cover expenses and ensure that they are eligible for their financial commitments.   The goal of proof of income verification is to: Assess associated risks and evaluate the applicant’s financial situation.   Trace the true source of funds and verify that the income comes from a legitimate source (for example, not a money laundering channel).   Help regulated entities comply with Anti-Money Laundering (AML) requirements and implement due diligence procedures. For example, a lending company asks for a proof of income document to check how much the potential borrower earns over a year. This helps guarantee that the person is stable and has a proper income stream. Common proof of income documents are the person’s salary, but they can also include other types of income sources, such as pensions or unemployment benefits, including passive income forms, such as money from property rentals and other investments.   In Which Cases Should You Provide Proof of Income? Mortgage approvals, loan applications, or tax filings require the person to provide proof of income documents as a way to confirm their financial stability. However, this is also a common check for simpler activities, such as obtaining a credit card or renting a new apartment. So, any agreement that is based on financial trust typically requires you to verify your income.   Businesses view the proof of income verification process as a way to guarantee that their clients have a legitimate income... --- ### Sole proprietorship vs LLC: Key Differences & KYB Nuances > Access the key information about the sole proprietorship structure and the difference between LLC, with a focus on KYB compliance. - Published: 2024-11-15 - Modified: 2024-12-06 - URL: https://www.idenfy.com/blog/sole-proprietorship-vs-llc/ - Categories: Blog, KYB/AML We discuss the main differences between a sole proprietorship and an LLC and explain how they need to be onboarded from the compliance side of things for financial institutions that deal with such structures during KYB verification. The US has reached a record-breaking number of 5. 5 million new business applications in 2023 alone, most of the filings being sole proprietorships or limited liability companies (LLCs). These two structures are common because they’re flexible and easy to set up. Many small businesses first start out as sole proprietorships, later transitioning to LLCs or corporations.   Freelancers, contractors and consultants are often sole props because their business is owned by one person — meaning they’re responsible for both profits and losses. LLCs, in the meantime, are owned by one or more members, operating as a separate legal entity, protecting the company from personal liability in case of business debts.   Both business structures have differences when it comes to filing bankruptcy, dealing with lawsuits, or paying taxes. For regulated industries, such as banks, this means more factors to consider when adjusting the Know Your Business (KYB) process for onboarding new sole proprietorships or LLCs. For example, the state the sole prop is operating in, what documentation they’re required to file, and how the business is structured.   But what kind of due diligence processes does that mean sole proprietorships should go through? More on this and how LLCs differ from sole props below.   What is a Sole Proprietorship? A sole proprietorship, also known as a sole prop, is a business that is typically operated by a single person, running the incorporated business alone. Legally, a sole proprietorship is not a separate entity from its owner, and that’s why sole props are the “sole” owners, receiving all responsibility, including dealing with debt.   Sole proprietorships aren’t required to report beneficial ownership because they are not considered to be registered entities. This type of business is relatively easy to set up. That’s why many local small businesses or freelancers choose to be sole proprietors. Sole props can also register a tax account or a trade name. They can also use a different name for their business, but it needs to be trademarked, depending on the jurisdiction in which they work.   A sole prop is also considered to be self-employed, but the term itself caters to a wider audience. Often, self-employed people need to make quarterly estimated tax payments and file annual income tax returns. This business structure is low risk. That’s why many small businesses use it to serve a dedicated customer group.   🟢 Factors that Make a Sole Prop Beneficial The best part about a sole proprietorship is that it doesn’t require lots of paperwork. This makes it a relatively quick setup process compared to other business structures. The management and running aspect of the business is also straightforward. The owner manages their own expenses and income on their tax return.   Key advantages include: A possibility to qualify for a tax deduction.   No need for an Employer Identification Number (EIN). Simple tax filing process using a Social Security Number (SSN). Many individuals start as sole proprietors when turning a hobby into a business. As... --- ### AML Compliance for Credit Unions: Top 3 Requirements > Discover what issues credit unions face when implementing AML compliance procedures and what steps are required to manage risks effectively. - Published: 2024-10-31 - Modified: 2024-12-09 - URL: https://www.idenfy.com/blog/aml-compliance-credit-unions/ - Categories: Blog, KYB/AML Follow this concise step-by-step explanation guide on adopting a practical AML compliance program for credit unions and what compliance-related challenges these institutions face when conducting internal risk assessments. Credit unions offer services like loans, mortgages, savings and similar services. Banks operate for profit, but credit unions focus more on serving their customers, opening doors to those previously denied loans by other financial institutions. As a result, banks offer higher savings rates compared to credit unions. But where does this leave the ultimate factor — compliance? Naturally, like any financial company, a credit union is also exposed to many risks because it handles a large movement of funds.   Despite that, previously, credit unions were exempt from certain Bank Secrecy Act (BSA) requirements. With the implementation of FinCEN’s Final Rule, credit unions are now required to comply with the regulatory framework, which also mandates having an Anti-Money Laundering (AML) compliance program. While this all seems like a straightforward path to ensuring that credit unions’ operations run smoothly, building proper AML processes and ensuring they are effectively managed can be challenging.   In this blog post, we’ll explore the primary crime risks that credit unions face and look through different AML measures that can help identify key red flags while ensuring compliance. What are the Basics of an AML Compliance Program? One of the key challenges that credit unions face is the need to keep up with industry rules that are consistently changing. This requires monitoring and setting clear policies, then polishing them and updating them to fill any potential regulatory gaps. However, there are standards that help companies build their internal processes, and one of them is the AML compliance program.   It includes the essential steps and guidelines that companies must follow to remain compliant, prepare for audits, and know how to report suspicious activity, among other steps, such as: Appointing a compliance officer. Implementing internal AML controls. Training staff so that they could be aware of the latest laws.   Establishing compliance-related processes and keeping all policies up-to-date. Defining reporting responsibilities within the company. Conducting independent testing and auditing to see if the program is effective. Providing a step-by-step guide for reporting fraudulent and suspicious activities to the authorities. All of these measures help identify inconsistencies in user behavior, report them and reduce the likelihood of financial crime. However, other factors, like following a risk-based approach to AML, are also important in this context because they help organizations build a proper risk assessment strategy based on risk factors that are applicable to their industry (for example, the business itself, its location, executive hierarchy and so on).   Related: What is an AML Compliance Program? Effective Risk Management Questions for Credit Unions Unfortunately, like with many AML processes, there’s no one-size-fits-all solution, but there are certain guidelines that can help you meet your compliance obligations.   For example, think if you can answer these questions about your business: What kind of services do you offer? How do you provide these services to your clients? Who are your customers, and do you have a proper customer due diligence (CDD) process? What is the jurisdiction in which you operate, and... --- ### Case Study: FriendFinder Networks > Find out how the major US-based social media and adult dating empire, FriendFinder Networks, integrated iDenfy's KYC/KYB and AML software. - Published: 2024-10-30 - Modified: 2024-10-30 - URL: https://www.idenfy.com/use-cases/friendfinder-networks-idenfy-study/ - Categories: Use Cases Explore the key RegTech measures FriendFinder Networks used to onboard their employees and verify end-users on its suite of dating, streaming and other websites, including adult-only platforms that required a robust age verification solution. Originally started as a mainstream social networking site in the 90s, FriendFinder Networks quickly adapted to consumer preferences and branched out into different social media verticals, connecting even more people worldwide. The company now operates multiple social media networks, including AdultFriendFinder, an exclusive platform focused on adult-only relationships. Currently, FriendFinder Networks has several heavily trafficked websites in the world, appealing to diverse cultures and interest groups while enabling people to interact easily. With over 700 million people actively using the company’s websites during a proven track record spanning two decades, FriendFinder Networks continues to create innovative social media solutions. However, this traffic also means that the business needs to operate multiple security measures that can ensure their customers’ data is protected and stored. On top of that, FriendFinder Networks operates in the adult industry by operating age-restricted services, in this case, a branch for users online to explore their fantasies and build new relationships. The Challenges FriendFinder Networks, a versatile social networking service company diversifying into various social media sectors, empowers its team members to create and deploy user-friendly web and mobile applications collaboratively. These applications cater to social networking and live-streaming video needs, serving millions of users daily. That said, FriendFinder Networks operates under the jurisdiction of the laws of the United States, and as such, the company’s compliance program must follow the requirements and guidance of all federal rules and regulations, including: Verifying employees (KYC). Verifying the identity of any customer the company enters into a business relationship (KYB). Screening sanctions lists to detect potential matches and prevent them from onboarding (AML). US legislation is a stringent matter, and any oversight due to negligence is not taken lightly. “The main challenge for our company was staying in compliance with the changing rules and regulations as a US business that provides online services globally,” explained an associate at FriendFinder Networks. FriendFinder Networks is dedicated to creating an online space for people to connect and consume content without any constraints. At the same time, before iDenfy, the company wanted to enhance internal employee satisfaction and engagement and reduce attrition rates — all in compliance with global regulatory requirements. FriendFinder Networks’ goal was to scale and accelerate growth while maintaining a compliant onboarding flow. That’s why time-consuming and lengthy manual ID verification processes weren’t an option. As a result, FriendFinder Networks needed dynamic Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance solutions that would allow them to verify identities, confirm user age, and alert the company of any sanctions or other violations to avoid any ramifications, and also streamline the onboarding processes. The Solution The FriendFinder platform places a greater emphasis on fostering friendships than the majority of dating sites. Since it originated as a social network almost three decades ago, millions of users continue to use the platform for that primary purpose. Consequently, the company wanted to partner with a trustworthy, user-centric identity verification provider, preferably carrying other fraud prevention tools. FriendFinder Networks looked for an automation solution to... --- ### Bank Account Verification [Guide] > Explore the top ways on how companies can validate a user's financial background through a simple bank account verification flow. - Published: 2024-10-29 - Modified: 2025-05-20 - URL: https://www.idenfy.com/blog/bank-account-verification-guide/ - Categories: Blog Learn what bank account verification is, what kind of measures or steps it takes to build a proper onboarding process, and why confirming a user’s bank account to check if it’s valid is vital for many companies, and not only banks and similar financial institutions. Many businesses are responsible for handling financial transactions, which automatically means one thing — identity verification and robust fraud prevention measures before the user is able to open an account. Since many companies now operate digitally, industries like banking, crypto, e-commerce, or insurance need to implement Know Your Customer (KYC) and Anti-Money Laundering (AML) measures. This might seem easy in theory, but in practice, risks like global operating markets, jurisdictional differences, cross-border transactions, and other risk factors all add a layer of complexity for those who are responsible for their business and their financial security. However, with growing regulatory requirements, the demands from the customers are also reaching new heights, so companies simply need to prioritize a robust onboarding process, which often consists of multiple security checks that are done by the user and the internal compliance team. Customers now also care about data security and want to make fast and secure transactions. To meet these expectations, companies need to both validate documents and extract identity information, which also consists of verifying their bank account and financial background. This process is known as bank account verification.   In this blog post, we look into the main challenges businesses face when scaling and ensuring regulatory compliance and how bank account verification can help maintain security while enabling quick, seamless payments. What is Bank Account Verification? Bank account verification is the process of confirming if a user’s bank account is valid and if it really belongs to the owner, who is a legitimate customer. This process verifies that the bank account is valid, active, and belongs to the person claiming ownership, supporting compliance with KYC requirements. Bank account verification also checks if the account has sufficient funds for transactions like automated payments or deposits. Many fintech platforms and similar services use this process to help reduce fraud. In general, the goal of the bank account verification process is to: Confirm a client’s account ownership. Verify their eligibility to open a new account. Check personal details (such as the account holder’s name, account number, and savings). Ensure that customer’s transactions are accurate and legitimate. See if the customer is eligible for further financial services (for example, stricter checks are conducted on investment platforms). When opening a new account, customers are often required to complete identity verification (using ID documents and cross-checking with external databases like a credit bureau) or provide proof of account ownership, such as a recent bank statement, which is an additional check and can be considered a bank account verification measure. When is Bank Account Verification Required?   This process is vital for any platform that handles online transactions and is required when the business first transacts with a new customer. It’s used for online transactions, such as electronic funds transfers and similar financial activities. The main benefits of implementing this check is to prevent errors, protect the user from fraud, and ensure the overall accuracy of transactions.   So, like with a standard identity verification check, which is often... --- ### 3 Stages of Money Laundering Explained > Luxury yachts, fancy cars, real estate empires or shell companies are only a few ways that criminals use in the 3 stages of money laundering. - Published: 2024-10-23 - Modified: 2024-12-11 - URL: https://www.idenfy.com/blog/3-stages-of-money-laundering/ - Categories: Blog, KYB/AML Money laundering is complex, especially when criminals manipulate tax authorities and law enforcement by turning dirty cash into legitimate income and mixing illicit funds with legitimate wealth. We break down the main laundering techniques and how they fit into the three stages of money laundering. Does breaking larger sums of money into smaller deposits and then transferring them into multiple different bank accounts sound familiar? Yes, that’s structuring, one of the many ways that bad actors use for money laundering. However, it’s not as simple or innocent as it may sound to some. Criminals launder funds that come from human trafficking, arms deals, drugs, fraud, or bribery.   According to Europol, in one year, they reported recovering $22. 5 million in cash, 118 bitcoins, gold and silver coins worth $6. 26 million, and $2. 39 million in assets from money laundering and fraud. Unfortunately, even some legitimately seeming financial service providers can use laundered cash to “invest” into their business. That’s why many organized crime groups launder funds professionally and do this full-time for a living, making it hard to trace the original source of the funds.   That said, anti-money laundering (AML) measures are here for a reason and not just for compliance or reporting purposes. In this blog post, we’ll talk more about the three main stages of money laundering and how to identify the red flags that you should know to avoid unwanted consequences.   What is Money Laundering? Money laundering is the process of turning dirty money from illicit activities, such as terrorism funding or drug trafficking, into appearing as legitimate funds. In other words, money laundering is the process of cleaning and laundering money to make it look like it came from legitimate sources and not criminal activities. As a result, to prevent such cases, financial institutions and other regulated entities must have a proper AML program in place.   Throughout recent years, the fastly emerging fintech space and digital assets, such as crypto, have unintentionally opened new doors for criminals to launder money. This is a classic example since bad actors can’t solely rely on cash despite the contrary belief that “cash is king. ” So, by converting cash into clean money and integrating it into the financial system, criminals protect their identities, scaling their “business” and aiming for bigger targets.   Related: Examples of Money Laundering and Prevention Methods What is the Money Laundering Process? Money laundering consists of three stages. The process starts with criminals depositing (or placing) the cash into the financial system. They often do this by converting cash transactions into digital ones, this way, cleaning the dirty funds. Then, we have layering, which is based on multiple transactions and dividing the cash into smaller sums as a technique to conceal the money’s true origin.   Lastly, through integration, dirty money is quietly combined with legitimate funds and integrated into society, appearing as proper, accessible funds. Since the money is mixed with legitimate transactions, detecting and determining its origin becomes a true challenge for law enforcement. Naturally, AML regulations are getting stricter, as money laundering is often linked to other serious crimes, such as terrorism financing, sanctions evasion, and others, which need to be detected as early as possible.   For example, a common money... --- ### Case Study: Coinzilla > Explore how the crypto advertising platform, Coinzilla, chose a RegTech vendor for an automated KYC/KYB compliance workflow. - Published: 2024-10-15 - Modified: 2024-11-20 - URL: https://www.idenfy.com/use-cases/coinzilla-idenfy-study/ - Categories: Use Cases Find out how Coinzilla integrated iDenfy's comprehensive KYB and KYC suite, fully automating both individual and corporate client onboarding that resulted in saved time and costs. The Challenges For Coinzilla, a key goal was to assist advertisers in launching targeted ad campaigns for their crypto projects. At the same time, they aimed to attract more publishers looking to display crypto-related ads through its highly innovative and fast-growing platform. For this to work through a simple and easily manageable process compliance-wise, both Know Your Customer (KYC) and Know Your Business (KYB) measures were required. Coinzilla’s team understood that a scalable approach was the go-to option and, for this reason, required automated software to streamline different time-intensive compliance tasks.   Ideally, Coinzilla needed a RegTech vendor that offered verification for both corporate and individual clients, with the option to customize KYB checks if needed, leaving room to make adjustments, regularly review data, and reassess customer profiles throughout the whole business relationship.   “A built-in identity verification process on a KYB solution specifically targeting shareholders and UBOs was incredibly important for us,” explained Stefan Luta, the CEO of Coinzilla. “We needed to know that we're dealing with legitimate individuals at the ownership level, which strengthens our trust in our partners and helps create a secure environment within our platform. ” However, before iDenfy, the Coinzilla team identified a few areas that they wanted to improve: The KYC onboarding process wasn’t fully automated, which required assessing information, including various documents, manually.   KYB compliance required verifying the identities of shareholders and Ultimate Beneficial Owners (UBOs), but this process involved collecting and verifying an excessive amount of information. Without automation in place, this approach was not compatible with the company's plans for scaling. The limited customization options and the need for a more refined approach to KYC/KYB compliance processes became vital, as Coinzilla recognized that a universal strategy wouldn't work, especially given the different markets, clients, and risk profiles they deal with. For example, sole proprietors and smaller businesses needed a simple onboarding process with fewer checks, as opposed to larger enterprises. According to Coinzilla, while these challenges haven’t caused a major negative impact on their business, they have posed potential risks, hindering the platform’s ability to function optimally. “A manual compliance system simply can’t keep pace with significant growth. We didn’t want any delays in our onboarding processes. We needed a solution that could help us prevent unwanted frustration and any negative impacts on our customer acquisition efforts,” added Stefan Luta.   The Solution Building an in-house verification system would have required significant resources, putting away Coinzilla's focus on building their advertisement network. So, to combat money laundering and other financial crimes, the platform needed to establish a clear understanding of who their partners are. This required a comprehensive third-party KYB solution that included a handful of components and features, such as KYC verification for UBO compliance or document verification for converting more global users. “We quickly found that running all of the compliance processes and ensuring that the data we use is correct would have required continuous investment in infrastructure and expertise,” said Stefan Luta, the CEO of Coinzilla.... --- ### The Main KYB Risk Factors You Should Know  > Is KYB causing you headaches? We compiled a short list of the main risk factors (signals) that you should include to stay compliant. - Published: 2024-09-30 - Modified: 2024-10-30 - URL: https://www.idenfy.com/blog/kyb-risk-factors/ - Categories: Blog, KYB/AML Managing risks and assessing multiple data points in your already complex KYB process can be a hassle. We provide a list of risk factors you should incorporate into your Business Verification flow for a more simplified approach to corporate entity onboarding. Know Your Business (KYB) checks go beyond regulatory compliance regulations. Many organizations today want to check who they’re partnering with — if the company is legit and if it is transparent in the sense that its financial transactions aren’t linked to crime or money laundering, including that all of the shareholders and related persons aren’t sanctioned, aren’t corrupt and so on.   While this process may look easy on paper, KYB has many risk factors that need to be considered. So, even though automation has lifted a massive burden, KYB still means that you need to conduct proper due diligence and have a structured risk management strategy, not to mention collect and verify extensive information and documents required for business verification. In this blog post, we’ll discuss which KYB risk factors you should assess, how certain signals can help you better understand another company, and whether it’s safe to start a business relationship with it.   What is KYB Compliance? KYB compliance is one of the key parts of the Anti-Money Laundering (AML) framework. In simple terms, it works as an identity verification mechanism, similar to the Know Your Customer (KYC) process. The key difference is that KYB focuses on the business (corporate client) and its owners, shareholders, as well as suppliers rather than its customers (individual clients) or consumers. So, when it comes to KYB, it’s a relatively new space, which leaves room for interpretation, especially if the company is global and operates in different countries with different compliance requirements. Additionally, when verifying a customer, partner, or distributor, each new layer of information may reveal further complexities.   In essence, KYB helps companies: Confirm ownership stakes in a certain company. Check the company's financial data. Verify company documents to minimize business risks. Assess if an individual is authorized to represent the company. Decide if it’s safe to start a business relationship. KYB requirements ultimately depend on the jurisdiction and the type of legal entity involved, which makes it vital to assess all KYB risk factors. For example, when expanding into a new market, you’ll require a different approach, as your already existing KYB framework might not apply in another country. The Key KYB Compliance Requirements  Before KYB became a thing, KYC/AML legal requirements left a huge gap that didn’t address the issue regarding business-to-business relationships. Major fiascos like the Panama Papers proved that it’s important to end this limitation and address money laundering concerns, especially through opaque corporate structures. So, this all took a turning point when the Financial Crimes Enforcement Network (FinCEN) introduced its Customer Due Diligence (CDD) Rule, or CDD Final Rule, which addressed KYB regulations.   Now, the KYB process is a mandatory requirement in many regions and requires companies to collect the following information during another company’s onboarding process: Legal company name. Operating address. Business registration status. Taxpayer Identification Number (TIN). Verification of Ultimate Beneficial Owners (UBOs) with 25% or more ownership. But how does this look in practice? Mandatory measures are required for KYB... --- ### How to Spot a Fake ID in Different States? [With Examples] > Learn the key security features that a legitimate ID document must have across different states from the KYC industry experts' view. - Published: 2024-09-30 - Modified: 2025-05-16 - URL: https://www.idenfy.com/blog/spot-a-fake-id-in-different-states/ - Categories: Blog, Identity Verification From students using fake IDs to purchase age-restricted items to fraudsters forging ID documents for obtaining loans and other large-scale operations — it’s important to know how to spot a fake ID in different states. Peeling sides, bumps on lamination, ragged edges, misspelling or missing watermarks — are all signs of fake IDs. While it seems like an innocent crime, using fake identity documents is a crime, and businesses need to take responsibility not to allow such documents into their systems, especially if they’re operating in a high-risk industry, such as fintech or iGaming, or provide age-restricted services, like adult-only content or selling alcoholic beverages.   Online retailers risk their reputation and juggle a fine line between security and ethical norms when they employ tactics like age gating or implementing simple checkboxes to approve one’s age instead of asking buyers to upload an ID document. This leaves room for interpretation and lies. Even when asking the person for their document, you need to be sure that you’re accepting a legit ID and not a forgery.   Unfortunately, there are still a bunch of non-compliance cases where companies fail to spot fake IDs and accept fraudulent accounts that can later conduct serious fraud on their platforms, such as taking out loans without ever repaying them or conducting affiliate fraud on e-commerce marketplaces.   So, what are the main red flags, and how can you spot a fake ID? We look into various examples across different states below.   Why Do People Fake IDs?   The most common reason why someone would show you a fake ID is that they’re trying to buy an age-restricted item and they’re underage. This happens all the time, especially in areas where the legal drinking age is 21, and many young people want to bypass security to get into clubs. Now, as many services shift online, some states are implementing stricter verification requirements on dating apps, for example.   Some users are hesitant to upload their IDs and share personal information on such apps due to some historical narratives. For example, adult dating apps and crypto platforms have a history of prioritizing user anonymity, making users even less comfortable with disclosing personal details. Most legit crypto platforms require IDs and ask their users to upload their government-issued documents before granting them access to their wallets.   Similarly, marketplaces like Vinted ask for IDs for reverification purposes or for utility bills as proof of address (PoA) before confirming any changes to a user's profile, such as updating their email address to prevent account takeover (ATO) attacks. The same principle applies to gambling sites, where, in extreme cases, minors try to access online casinos and similar games, which makes ID document checks vital.   Immigration, employment, and education also face the same issue regarding fake IDs and other documents. For example, sometimes students struggle to access scholarships or don’t have the right visas to study abroad, so they fake their personal information, including IDs.   Related: Top 5 Identity Verification Measures What are the Most Common Fake IDs? There are different types of fake IDs. The most common examples include: 1. Forged IDs This is the type of ID document that is completely... --- ### Keywords in Adverse Media: Search & Screening Challenges > What is the issue with adverse media? There isn't one. Except you need to know what keywords in this process you should use. Find out more. - Published: 2024-09-25 - Modified: 2024-11-07 - URL: https://www.idenfy.com/blog/keywords-in-adverse-media/ - Categories: Blog, KYB/AML Go through the main problems that compliance teams often deal with when using keywords in adverse media and find some useful tips on how to conduct a more effective adverse media screening process that scales. Adverse media, also known as negative news, is relevant public information that is collected from various news sources that are used to identify crime, such as individuals or companies associated with money laundering, bribery, sanctions evasion, drug trafficking, organized crime, tax evasion, financial fraud, and similar offenses. While screening newspapers and analyzing thousands of articles might seem inconvenient, adverse media has been around for a long time, serving as a vital anti-money laundering (AML) compliance measure and an effective risk management measure for many regulated entities.   Regulatory bodies, such as the Financial Action Task Force (FATF) or Financial Crimes Enforcement Network (FinCEN), recommend adverse media screening as a mandatory AML process for customers and third parties, especially for enhanced due diligence (EDD) and high-risk entities. This makes it hard for financial institutions to manage large amounts of data, especially if no automated tools are used. So, like with many compliance-related tasks, the main challenge is to build an efficient yet accurate and compliant risk management system, which includes reviewing multiple adverse media sources.   In this blog post, we’ll review the key adverse media strategies, the keyword search approach, how technology affects screening, and what challenges companies need to overcome when it comes to AML compliance.   What are Some Examples of Adverse Media? There are risk factors that are clear, but in general, it depends on the institution and how it decides what qualifies for adverse media and whether it makes the customer high-risk. For example, a person on a sanctions list is always at a higher risk. Common examples of risk factors that most companies include in their adverse media practices are: Political exposure. This includes Politically Exposed Persons (PEPs), who are high-ranking government officials, their family members, and close associates. Due to this sort of exposure and status, these individuals are more likely to be linked to corruption and other financial crimes.   Sanctions. Sanctions change, and sometimes, high-profile sanctions actually make the news before they are added to some official sanctions lists. In this case, adverse media screening is a good solution to stay in line with recent updates.   Geographical risk. Some countries or regions are considered high-risk due to changing political conditions, economic instability, or high crime rates like money laundering or corruption. For example, the FATF identifies places like Iran and Myanmar as high-risk. As a result, clients from these areas should be carefully monitored. Crime. This is the essence of adverse media since it’s important to find customers and other companies linked to fraud, terrorism, money laundering, financial crime, and other similar offenses. The media often covers major cases like this. Some companies can accept the risks that come with certain business relationships, such as high-risk politicians. In this case, high-risk clients require enhanced due diligence (EDD) measures, including adverse media screening and ongoing monitoring to prevent money laundering and other illicit activity.   Related: What is the Difference Between CDD and EDD? What Regulations Mandate Adverse Media Screening? Back in... --- ### Merchant Onboarding: Steps, Required Documents & More > Learn how PSPs and banks deal with merchants, what documentation is needed for KYC/KYB, and how to ensure a swift merchant onboarding. - Published: 2024-09-11 - Modified: 2024-11-13 - URL: https://www.idenfy.com/blog/merchant-onboarding/ - Categories: Blog, KYB/AML Learn what challenges are expected when onboarding merchants, how to balance out the security aspect with a smooth merchant onboarding process, and what kind of information you should collect and verify to comply with KYC/KYB and AML requirements. What can an effective merchant onboarding do to your business? Well, for starters, it can be used as a tool to reduce fraud and improve user experience. For this reason, to have a secure and simple payment processing system, you also need to optimize your merchant onboarding, which is crucial for your scaling and a channel to attract more merchants and more transactions.   If you're a payment service provider (PSP), onboarding new merchants means carefully designing and executing their onboarding process according to specific needs. However, the key challenge is finding the right balance between a simple, straightforward onboarding process and a more thorough approach that prevents fraudulent activities. This balance is crucial because fraudulent merchants can lead to problems like chargebacks and revenue loss. We explore how you can efficiently onboard legitimate merchants while preventing fraud from impacting your business, as well as other nuances that you need to know about merchant onboarding.   What is Merchant Onboarding? Merchant onboarding is a security process when payment processors and payment service providers (PSPs) sign up new customers (merchants) to handle their payments. This works as a fraud prevention measure because, if not done properly, non-compliant merchant onboarding can result in transaction failures, fines, and improper risk management.   Typically, this process involves verifying client identities, submitting documents, conducting background checks, performing financial assessments, and implementing other compliance measures, depending on the business and industry. A well-managed merchant onboarding needs to be swift and simple, which is one of the top priorities for businesses to both stay compliant and attract new customers in this highly competitive market.   The merchant onboarding process aims to ensure that the business is legitimate and capable of handling transactions securely and efficiently. That’s why it affects user experience and operational efficiency — both factors that need to be balanced out.   The Key Figures in the Merchant Onboarding Process There are several important figures that complete the merchant onboarding process. To balance out a smooth end-user experience, compliance and security, you should know all of the key players.   These typically include: Payment service providers (PSPs). These are the businesses that offer payment processing services to other companies, including transaction processing, authorization, and settlement, and at the same time, ensure compliance with regulatory requirements.   Merchants. These are the companies that accept payments from users. Merchants partner with PSPs to facilitate transactions online, but their services also include in-person and mobile payments. Acquiring banks. These are financial institutions (also known as merchant acquirers) that partner with PSPs to process transactions for businesses and handle the underwriting of merchant accounts.   Payment gateways. This is the front-end technology that transfers the transaction data to another business system. For example, it can be a company’s app or a point-of-sale (POS) system. Payment gateways read card data and transfer customer information to the acquiring bank for processing. Issuing banks. They provide users with payment cards that are branded by card companies, such as contactless devices, prepaid cards,... --- ### What is an AML Risk Assessment? [With Examples] > Find out the key examples and practical tips on how to perform an AML risk assessment while using AML compliance solutions. - Published: 2024-08-31 - Modified: 2024-09-04 - URL: https://www.idenfy.com/blog/aml-risk-assessment/ - Categories: Blog, KYB/AML Find out what processes you need to perform an AML risk assessment and the key risk factors you should consider when assessing your company and its clients to stay AML-compliant. At first glance, most clients show typical behavior and present a normal risk level. However, in practice, risk factors like the customer’s location, type, transaction patterns, or industry can elevate the risk or, more importantly, change over time. That’s why it’s clear — you need to understand certain nuances if you want to build an effective anti-money laundering (AML) strategy that works. For that, we have the AML risk assessment process, which helps companies understand unique customer profiles first-hand while identifying risks that could potentially lead to money laundering.   AML risk assessment is crucial for using a risk-based approach and documenting each client's risk level through an optimized and compliant AML workflow. Despite everyone knowing the importance of AML compliance, risk assessments raise questions, leaving this complex topic a common discussion in the “non-compliance” section. Of course, navigating different AML requirements across various jurisdictions doesn’t help, either.   So, what does it really mean for a company to address and mitigate potential risks? How do AML risk assessment requirements differ for corporate and individual clients? What kind of due diligence measures are required for this process? We answer these and other questions below.   What is an AML Risk Assessment? An AML risk assessment is a process designed to determine the likelihood of a customer using the company’s products, services, or the platform itself for money laundering and other criminal activities, such as terrorism financing and tax evasion. In other words, this process measures the risk of each client as a way to minimize chances of being involved in any fraudulent schemes.   Any company involved in financial transactions should use AML risk assessment to comply with AML laws and regulations, as well as ensure a secure environment by: Identifying different types of money laundering risks. Assessing the level of exposure to such risks. Implementing effective measures to manage these risks.   Evaluating and enhancing these measures to improve AML risk management.   Companies use AML risk assessment to understand how different types of risks are related. Since there’s no one-size-fits-all approach to risk management, risk factors differ based on the company’s industry. However, common risks that need to be assessed are service risk, customer risk, geographic risk, transaction risk, and product risk. Who Sets Out AML Regulations? It depends on the country, however, there are several standards that work like a unified AML approach globally. For example, a known regulatory watchdog, the Financial Action Task Force (FATF), is one of the key players that sets standards for countries to develop and update their AML laws, such as its 40 recommendations.   Other AML compliance requirements worldwide include: 🇺🇸The Bank Secrecy Act (BSA) 🇪🇺Anti-Money Laundering Directives (AMLDs) 🇬🇧The Proceeds of Crime Act (POCA)  🇨🇦The Proceeds of Crime (Money Laundering) and Terrorist Financing Act Related: AML Automation — Streamlined Compliance 101 for Businesses What are the Key Compliance Processes of an AML Risk Assessment? Many regulated entities are required to have AML programs in place, which are often based on... --- ### What is a Transaction Dispute? [Challenges for Merchants] > Learn about why a cardholder might open a transaction dispute, what this process means for merchants and PSPs, and how to minimize disputes. - Published: 2024-08-30 - Modified: 2024-09-05 - URL: https://www.idenfy.com/blog/transaction-dispute/ - Categories: Blog Understand the key reasons a cardholder might initiate a transaction dispute, how these disputes are connected to chargebacks, the strategies merchants can use to manage high costs, and effective methods to prevent friendly fraud. Transaction disputes can lead to chargebacks, and lately, the chargeback season has been generous for customers disputing their transactions, resulting in millions in damages to businesses. Partially this is no surprise since many businesses now operate through remote e-commerce channels. But what exactly is a transaction dispute? This process happens when a customer files a complaint about a debit or credit card purchase. So, when a transaction is disputed, the payment the business received can be reversed and refunded to the cardholder.   The original goal of such disputes — to maintain a fair and transparent payment system — is vital. Customers exploit this to their advantage and aim to keep the funds without a legitimate reason. In general, disputes should be opened only due to fraudulent activity, such as unauthorized charges, or issues with the merchant, such as an unreceived item. For merchants, this can lead to restrictions, financial penalties, lost inventory, and more.   We discuss critical business tips and ways to respond to transaction disputes.   How Does a Transaction Dispute Work? The cardholder has to file a complaint against a merchant about a specific transaction. They contact their bank to challenge the payment. Often, the claims from the customer’s side involve a potentially unauthorized transaction, but in general, a transaction dispute can arise for various reasons, such as if the services weren’t provided, the item arrived damaged, the card details were used without the cardholder's authorization, etc.   For merchants, it’s challenging both to prevent and predict disputes because they can arise from different sources. For example, friendly fraud or first-party fraud happens when a legitimate cardholder engages in fraudulent behavior (whether intentionally or not). In contrast, true fraud disputes work by disputing an actually fraudulent purchase.   The Legality Behind Transaction Disputes A transaction dispute is a legal right for the consumer. It isn’t a new practice as well. By implementing a standard transaction dispute policy, the credit card industry wanted to add more trust and confidence as a practice to boost sales and ensure security.   However, many users and bad actors abuse this system. As a result, merchants lose revenue and spend time dealing with the whole dispute process. Additionally, even more funds are required if the business chooses to contest the dispute.   If you’ve worked with payments, you know there’s a list of reason codes showing why the customer disputed a certain charge (if it reaches the chargeback rate).   Cardholder Complaints Qualifying for a Transaction Dispute 🔴 Billing Errors Incorrect amounts or dates linked to the dispute. Charges not showing the cardholder’s change of address. Missing post-purchase credits or returns. Charges made outside agreed times or methods. 🔴 Unauthorized Charges The cardholder didn’t approve a transaction (for example, the fraudster used stolen information). The cardholder doesn’t recognize the charge in their bank statement. Items or services show up on the invoice, but they weren’t ordered. Multiple identical items were purchased in a short timeframe. 🔴 Service Quality Issues Missing items.... --- ### Best Age Verification Software Providers of 2025 > Best Age Verification Software Providers of 2024. Features and reviews of 5 Best Age Verification Solutions. - Published: 2024-08-28 - Modified: 2025-01-22 - URL: https://www.idenfy.com/blog/best-age-verification-software-providers-of-2024/ - Categories: Blog Choose the right age verification vendor to prevent against under-aged users Best age verification providers: Explore the top age verification software on the market. Compare features and read expert and customer reviews to find the perfect tool for your needs. Top 5 age verification providers #NameScoreDescription1iDenfy4. 9All-in-one identity verification platform to onboard more users2ID. me4. 6Wallet simplifies how individuals discover and access benefits and services through a single login and verified identity3Sumsub4. 6Sumsub is a verification platform that aims to secure entire user journeys4Onfido4. 1Create trust at onboarding and beyond with a complete, AI-powered digital identity solution built to help you know your customers5Veriff4. 0AI-powered Identity Verification Software Last updated: The Main Features for Age Verification Vendor Integration choices Since age verification is vital for onboarding for different industries, such as adult content, alcohol, tobacco, iGaming, and others, the right software vendor will offer multiple integration options. These usually include direct link generation via dashboard, API, iFrame, or SDK integration. It is helpful when a vendor supports major third-party platforms with out-of-box integration, such as WordPress, Woocommerce, Bubble, Zapier, etc. Accuracy of age verification If the KYC vendor cannot guarantee an accurate OCR extraction of the person’s date of birth, it creates additional compliance issues and puts you in an inappropriate spot. Each vendor can provide the success rate of verifications (the accuracy of preventing fraudulent documents and filtering unacceptable documents). KYC vendors can utilize an additional 24/7 manual review to maximize the success and approval rates. Costs per age verification checks The cost of age verification checks must be considered to correctly estimate the budget for designing the onboarding process. Since age verification involves taking pictures of the identity documents, the software vendor must accurately determine the age verifications. Usually, due to poor camera quality and ambiguous guidance, users generally fail multiple times before proceeding with correct identity verification. Thus, a vendor charging per every verification check increases onboarding costs without offering precise ROI calculations. Fitting into other compliance procedures Since age verification is part of the entire KYC procedure, where identity documents are captured, choosing a KYC vendor with a complete compliance solution is necessary to guarantee higher accuracy and lower your business risk exposure. You have to verify whether an age verification software provider is GDPR compliant and has ISO 27001 certification. #1 iDenfy 4. 9 Average Score · (4. 8 Captera | 4. 9 G2 | 5. 0 TrustRadius) iDenfy website: www. idenfy. com Integration choices iFrame, Dashboard, and mobile SDKs are supported by white-label customization. Furthermore, there is additional support for 3rd party plugins: Zapier, WordPress, WooCommerce, Bubble, Magento, and others. Accuracy of age verification iDenfy has a 99. 9% verification success rate, with varying approval rates. iDenfy uses manual and automated verification methods, thus increasing the accuracy of identity verification checks - age extraction becomes more accurate. Costs per age verification check iDenfy does not showcase a particular price per check but offers a model where partners are charged only per onboarded customer instead of charging per age verification check. Fitting into other compliance procedures... --- ### What is a Sanctions List? > Find out what a sanctions list is, what regulatory bodies are responsible for sanctions compliance, and how to screen AML databases. - Published: 2024-08-27 - Modified: 2024-09-06 - URL: https://www.idenfy.com/blog/sanctions-list/ - Categories: Blog, KYB/AML Learn all about sanctions compliance, starting from defining a sanctions list and ending with automated AML solutions for effective sanctions screening and risk management. While for some, a “sanction list” is just a known term, for others, it’s a complex concept that is known to have influenced organizations, compliance regulations and national security over the years. Many industries deal with sanctions and are obliged to identify targets, both individuals and entities, that are under various sanctions regimes due to potential risks of being linked to terrorism, war crime or drug/weapons trafficking, human rights violations, and other serious threats.   The biggest challenge linked to sanctions is that the lists change, and a single misstep can lead to non-compliance, fines and reputational damage. However, sanctions are much more than standard regulatory compliance obligations. They are designed to achieve foreign policy and national security objectives. Screening sanctions lists is crucial to prevent involvement in transactions linked to corruption, bribery, or blackmail.   Understanding different sanctions regimes is important for compliance officers, business owners, and anyone who deals with global affairs, which we’ll discuss in a more detailed matter below. The Definition of a Sanction List  A sanction list is a combination of countries, entities, and individuals that face penalties for engaging in illegal activities, such as terrorism, money laundering, weapons proliferation, and human trafficking. They are added to sanctions lists because of their threat to global security and peace. Being on such a list means you’re facing asset freezes, travel bans, trade embargoes, and financial prohibitions.   A sanctions list keeps detailed information about different offenders, including who they are and the activities from which they are restricted. Sanctions lists are regularly updated because of evolving geopolitical situations. Authorities like national governments issue them. The main issue from a financial institution’s perspective is that these lists can be a hassle because compliance teams must deal with various sanctions lists, resulting in them having to keep up with vast amounts of data. For example, the HM Treasury oversees 26 sanctions lists in the UK. On a global level, the Office of Foreign Assets Control (OFAC) can list people who violate foreign policy as Specially Designated Nationals (SDNs). The status of the OFAC SDN list restricts the person from participating in the global marketplace, which, as a result, becomes a national and international warning. Types of Sanctions There are different sanction categories that help companies better understand how to respond to regulators’ requirements. For example, sanctions imposed by the United Nations are considered to be international. Some types of sanctions overlap and can be combined, such as how the UN, US and EU combined military, financial and economic sanctions.   In general, these are the key types of sanctions: Financial sanctions. This includes limiting market access, banning transactions or freezing assets in order to impact a country’s financial sector. For instance, the US has imposed financial sanctions on Iran.   Economic sanctions. These penalties, such as travel bans, trade embargoes, or asset seizures, are imposed on a country, its officials, or its citizens. Military sanctions. Examples include restricting military aid or arms embargoes. Military sanctions are used in... --- ### Can You Combat Bonus Abuse in iGaming? > Bots or proxies might be nothing new in a fraudster's agenda, but the iGaming industry has shown that bonus abuse still remains an issue. - Published: 2024-08-14 - Modified: 2024-09-11 - URL: https://www.idenfy.com/blog/bonus-abuse/ - Categories: Blog Explore some interesting details about the number one fraudulent tactic in iGaming — bonus abuse — and learn the key measures that casinos and other online gaming establishments use to tackle this issue. Bonus abuse is still an issue for many iGaming operators. Over the years, players have been searching for ways to easily cash out after benefiting from new user opportunities. Numerous discussions on Reddit still exist today, where users discuss how they “scalped” online casinos for years and chose high-stakes games with an “optimal” strategy to guarantee profit.   While critics argue that regulators and some establishments have “smartened up” a bit, users still find ways to exploit free spins, sign-up promotions and other marketed introductory bonuses that are intended only for newly registered users. So, yes, duplicate accounts are also a big challenge for gaming platforms, which also ultimately leads to revenue loss. So what can iGaming businesses do to attract new users and fewer fraudsters? We look into the best Know Your Customer (KYC) verification practices and review expert insight on whether it is actually possible to stop bonus abuse.   What is Bonus Abuse? Bonus abuse, also referred to as promo abuse, is a form of fraud that happens when users on iGaming and gambling platforms misuse promotional materials, such as discounts, free spins, or sign-up bonuses, to access new user benefits multiple times by bypassing verification checks. These promotions help platforms encourage gamers to play for free and later bet with their own money, and in an ideal scenario, both the business and the customer should benefit from this system.   The main issue is that some users can exploit such bonuses for money laundering and other malicious activities. While iGaming is most targeted in this sense, fraudsters who abuse bonuses can also affect other industries, such as e-commerce, streaming, or carsharing. To put it simply, any company that uses sign-up bonuses as a marketing tactic is at risk.   The Legality Around Misusing the Bonus System  Bonus abuse fraud is also known as multi-accounting, which goes against fair gaming practices and gaming establishments’ policies. While not all users involved in such bonus abuse have fraudulent intentions, some are highly experienced cheaters who have skills in committing fraud. They know how the system works and how to exploit the platform’s vulnerabilities for their own personal benefit.   Despite that, bonus abuse fraud is widely known now and is considered to be just a casual going around the system for many regular gamblers. Naturally, more experienced criminals use more advanced tools, such as bots, residential IPs and other methods to create multiple virtual environments for multi-accounting, making it challenging for operators to detect this type of fraud.   What Kind of Bonuses Do iGaming Platforms Offer? The most popular types of bonuses that operators offer include: Free bets Free spins  Cashback Reload bonus Bonus codes No deposit bonus Reward program Refer-a-friend bonus For example, when fraudsters sign up for a casino affiliate program, they refer “friends” and earn cost-per-lead commissions. They sometimes also generate fake traffic to earn cost-per-click commissions. Abusers use these bonus systems to exploit promotions by often working with others and creating multiple accounts, as... --- ### How to Spot a Fake Utility Bill? > Find out the main tactics fraudsters use to forge a utility bill, why it's a common practice in lending, and how to identify a fake document. - Published: 2024-08-06 - Modified: 2025-04-24 - URL: https://www.idenfy.com/blog/fake-utility-bill/ - Categories: Blog Find out the main signs that might signal that the utility bill is fake and learn the exact reasons why businesses might ask you to verify address info, including extra tips for companies to prevent document fraud. While certain forged documents sell for thousands on the dark web, such as a passport from an EU country for $3,000, acquiring fake documents and digital copies is now easier than ever. Bad actors create special templates that help others create counterfeit documents practically for cents. This trend is natural given the technological advancements in AI and digital onboarding processes that require government-issued IDs or Proof of Address (PoA) documents. These advancements have created a niche for criminals looking for simpler methods to produce cheaper and more convincing document replicas. Among the popular targets for forging, utility bills take the lead. These documents are widely used for verification because almost anyone who owns or rents a home pays for their utilities. These documents also have the person’s name, address, issuing date, and other important details, serving as a tool for address verification in many regulated industries, including banking, fintech, crypto, lending, etc. For example, mortgage companies rely on utility bills as a way to check the person’s current residency and creditworthiness in order to grant or deny financial access. But can you distinguish a fake utility bill from the real deal? We review the main signs of forgery and explain how fraudsters use these documents for their benefit. What is Considered a Utility Bill? A utility bill is a statement that details charges for services like gas, water, electricity, or internet. Any document from a utility service provider that includes the issuing date, the person’s name, address, and usage charges qualifies as a utility bill.   Utility bills are an accepted form of PoA used in the address verification process. Regulated industries, such as financial service providers and cryptocurrency platforms, are required to use these documents to verify their customers’ addresses and comply with customer due diligence (CDD) requirements.   Why are Utility Bill Checks Necessary? Utility bill checks are security processes designed to confirm that the person providing the document is real and that they really reside in the registered address. This is a legal requirement in many jurisdictions before obtaining a loan or opening a bank account. Fraudsters use fake documents, including forged utility bills, to commit all sorts of illegal things, including money laundering under stolen identities. Some criminals particularly target financial institutions with less stringent security checks or those who handle a large volume of transactions and can potentially miss fraudulent applications. This is a relevant issue today since the post-pandemic economic conditions and wars in the world have led some lenders to rely on manual document reviews. Many alterations aren’t visible to the human eye and can be time-consuming to detect compared to automated verification. That’s why AI-powered software offers a more efficient solution for verifying utility bills. Related: How to Combat Document Forgery? What Motivates People to Create Fake Utility Bills? Some people don’t feel comfortable enough to share their personal information, let alone their address. This is common when users are asked to upload a photo of their utility bill or their ID... --- ### What are Deepfakes? Good vs Bad Use Case Examples > Get the latest scoop on the world's most famous deepfakes, their positive and notorious examples, and why ID verification is important here. - Published: 2024-07-31 - Modified: 2025-05-16 - URL: https://www.idenfy.com/blog/what-are-deepfakes/ - Categories: Blog Find out how modern deepfakes work and how they manage to trick both biometric verification systems and average internet users into thinking the synthetic video is legitimate. From a fake video of Ukraine’s president Zelensky, to the viral “Tom Cruise” TikTok sensation — deepfakes have stormed the Internet, and yet, many of their use cases aren’t designed for the better good. The synthetic media created by AI merges a sense of reality with events or characters that didn’t actually happen.   By planting its roots in 2017 on Reddit, the term “deepfake” now is linked not only to innocent videos and swapping faces, it’s also associated with misinformation, propaganda, porn and cyberattacks.   But are deepfakes really that bad? We look into modern AI, deepfakes’ origins, use cases, and risks to businesses and society as a whole.   What is a Deepfake? A deepfake is a manipulated image, video, or audio recording designed to produce realistic media of people who actually didn’t say any of the things or never actually existed at all. It’s a form of media that is created by sophisticated deep learning algorithms and artificial intelligence (AI).   A common example of a deepfake is a fake video of a celebrity, a politician, an influencer, or another prominent figure that can potentially show shock value due to the content of the video. That’s why, oftentimes, deepfakes can damage reputation, cause distress and spread misinformation.   A sophisticated deepfake can trick people into thinking that it’s real. In general, deepfakes can be used in different ways and different industries, including sectors like entertainment and cybersecurity. Criminals also use this technology for deceptive practices. They collect information from emails, magazines, as well as social media posts to produce deepfakes. Sometimes, fake images and real sounds are modified and produced into deepfakes to appear more realistic to the general public.   What is Deepfake Technology?   Deepfake technology is another term for deepfakes and a form of AI that uses deep learning and machine learning algorithms that are able to learn from vast datasets. The two algorithms — generator and discriminator — work like this when creating a deepfake image: The first algorithm generates a realistic replica of an image. The second algorithm detects if the replica is fake and identifies the differences between it and the original. The first algorithm then adjusts the synthetic content based on feedback from the second algorithm. It continues to perfect it until the second algorithm isn’t able to detect any false elements. This process is repeated as many times as needed.   Consequently, deepfake technology learns from a lot of examples, quickly analyzing facial features, people’s expressions, details of human speech and behavior, and more. Simulating such details with high accuracy would be a complex task for people in real life.   The term “deepfake” survived in the media in 2017 after a Reddit moderator coined this title and created a subreddit called “deepfakes”. It mainly included videos of celebrities that were created using face-swapping technology, then evolved into bigger hoaxes that featured pornographic content.   How are Deepfake Videos Created? People create deepfake videos by training the AI model... --- ### What is Loan Fraud? Types and Prevention Tips [Business Guide] > Get updated with the latest loan fraud types and learn how to identify red flags pointing to potential fraudulent activities. - Published: 2024-07-26 - Modified: 2024-09-18 - URL: https://www.idenfy.com/blog/loan-fraud/ - Categories: Blog We discuss the main loan fraud types, what fraudulent schemes are trending in the lending market, and list concrete solutions for businesses to help prevent this financially damaging crime. One of the most valuable industries in the financial sector, lending comes with a good share of risks. For many, this comes off as no surprise since many credit card companies or fintechs offer online loan applications, making it easier for fraudsters to bypass security checks. For this reason, financial institutions still struggle to find the balance between offering convenience and actually securing this high-value market. Fraudsters can open a mortgage in another person’s name, leaving the victim with huge repayment burdens. Other related crimes like third-party fraud are even more alarming since the borrower has no intention of repaying the loan. Without proper identity verification measures during the application process, criminals can use stolen credentials, damage the victim’s credit and leave the financial institution and the person with huge financial losses.   Naturally, such illegal transactions result in financial losses for both customers and businesses. In this blog post, we get our hands on loan fraud, its specifics, what this crime can do to lending companies, and what fraud prevention solutions can help minimize chances of dealing with devastating consequences. The Definition of Loan Fraud Loan fraud, also referred to as lending fraud, is a deceptive practice, which involves illegal actions to gain financial benefits by obtaining loans using stolen personal data. The goal of the fraudster is to access the funds without getting caught, and, as a result, the remaining party is left with financial losses.   Loan fraud can occur anywhere people can borrow money or extend their credit. It has various forms, and it involves mortgage and payday fraud, account takeover (ATO) fraud, as well as other loan scams, including online landing fraud. Loan fraud is quite common since some institutions providing such services require minimal information and identification during the application process.   The Importance of Managing Loan Fraud Chances To prevent loan fraud, companies should pay attention to their security practices. While this may seem standard practice, loan fraud is still an issue, affecting at least 1 in 134 mortgage applications, according to a recent study. Managing fraudulent activities is important for a business to scale properly instead of only thinking about quickly attracting new customers through an easy sign-up process.   Many loan companies only ask for basic information during the application process, making it easy for criminals to obtain critical details like the user’s bank account number. In essence, loan fraud prevention helps prevent criminals from exploiting vulnerabilities in the system while protecting the whole financial system and the company’s assets or important personal data.   Who Becomes the Victim in Loan Fraud? Unfortunately, anyone can become a victim of fraud. However, the roles of fraudsters and victims vary in terms of loan fraud. The creditor offering the loan can act fraudulently, and the debtor receiving the loan can also become a fraudster.   In general, no matter the scenario, loan fraud is an issue mainly because: Lenders struggle to find the right identity verification processes that wouldn’t be easily bypassable and... --- ### Top 5 Identity Verification Measures [For Beginners] > Find out the most popular identity verification measures in the market today and look into the reasons why companies implement them. - Published: 2024-07-24 - Modified: 2024-09-19 - URL: https://www.idenfy.com/blog/identity-verification-measures/ - Categories: Blog, Identity Verification Stricter regulations across new industries, including social media or gaming, and new age verification requirements have pushed businesses beyond the traditional financial sector to find proper identity verification measures that carry multiple features. But is it actually achievable? We review the most popular KYC measures in the market. Companies need to be certain that they’re opening doors only to legitimate customers. Otherwise, without proper identity verification measures, they risk everything — from major financial losses to lost credibility and legal consequences. More importantly, a secure network, for example, on a fintech platform, means more happy customers who trust the service provider with their personal information.   Despite the efforts to prevent fraudsters with stolen identities, forged documents, or worse, money laundering tactics that went unnoticed, companies struggle to find the right identity verification solution that would offer security and convenience to their customers. Many factors should be considered, for example, the market you’re operating in, the scale of your business operations, different flows, and situations that perhaps would require additional verification measures.   We discuss these and additional topics below showcasing the top identity verification options available in the market today.   How Does the Identity Verification Process Work?   Identity verification is a process that is designed to confirm a person’s identity and to see that they’re not lying about their personal information. Typically, it works by asking the user to upload a government-issued ID document and record a video selfie. This is a common method in high-risk industries, which are regulated. For example, crypto platforms and iGaming institutions are required by law to verify their users’ identities, sometimes including other aspects, such as their address data or age.   Verifying a customer for a business means that they’re ensuring that the customer is genuine and that they are who they claim to be. This is important because all profitable businesses have money flowing. So, not only large-scale banks but also small enterprises need to ensure that the customers conducting the transactions are real and that they aren’t using them to commit financial crimes.   What is Know Your Customer (KYC)? Know Your Customer (KYC) is a process of verifying customer identities and assessing the potential risks of getting into a business relationship with them. A KYC check is part of the customer due diligence (CDD) process and can involve a document verification check. In this case, the process verifies that the customer has provided a legitimate ID document, that it belongs to them, and that their personal information matches the data on another government database.   KYC compliance helps companies achieve three main goals: Establish the customer’s identity.   Understand their financial activities and ensure their funds are legitimate.   Assess various risks linked to their transactions while monitoring activities. KYC verification is also also a crucial part of anti-money laundering (AML) compliance. It helps companies detect fraudulent identities, such as users trying to submit fake or altered documents, and other fraudulent acts, such as identity theft, money laundering, and other financial crimes.   The Main KYC Requirements Over the years, identity verification requirements became stricter due to the regulatory loopholes and crimes left unnoticed by major banks and other financial institutions worldwide. One of the first KYC requirements was established in the USA through the... --- ### Age Verification in Online Dating: Why You Should Take it Seriously > Find out if age verification is mandatory in online dating and dive into some notoriously dangerous details that dating apps try to hide. - Published: 2024-07-19 - Modified: 2024-09-23 - URL: https://www.idenfy.com/blog/age-verification-online-dating/ - Categories: Blog Find out why age verification in online dating is vital, especially when the Tinder Swindler era has inspired scammers to stop up their game and spread even more convincing tactics to lure their victims, often who are underage. The younger generation doesn’t remember their lives without smartphones. The digital lifestyle has become not a privilege but an absolute necessity, and with that, all sorts of applications are continuing to be created globally. This includes dating apps and online dating in general, which have also become a part of a daily routine for singles around the world. Statista reports that in 2022, 57. 44 million people in the United States used online dating services, which means that at least 30% of adults had used them at some point. However, while this sounds like fun and games, the dating scene has its own risks. The Tinder Swindler stories have changed the narrative, pinpointing dangers like romance scams. But that’s not all. Regulators are now talking about more stringent age verification requirements for minors online; this includes both social media apps and dating platforms.   With new requirements to protect minors from age-restricted content, dating apps are implementing new measures to prevent easy access to their services. The already established standard in the online dating industry is asking users to upload a photo of their government-issued ID document and record a video selfie.   This way, online dating platforms match the ID with the profile, both confirming the identity and verifying that the person is at least 18. But what else is there to know? We explore the pros and cons of age verification requirements in online dating while digging deeper into this industry's risks. How Do Dating Apps Conduct the Age Verification Process? A typical age verification process on a dating app includes a selfie and a document photo. That means the user is asked to upload a photo of their ID document and capture a video selfie. Dating apps can choose one method or combine both methods of verification.   It’s powered by facial recognition software that confirms that the user is a real person and that their personal details match their profile photos. Additionally, dating apps offer a verification badge that allows other users to see that you have confirmed your identity and age.   In general, age verification for online dating serves two purposes: It follows laws that enforce age limits for certain age-restricted industries, including social media and dating apps.   It acts as a way to protect young people from age-inappropriate and harmful experiences, which can be linked to romance scams, for example. Why Should the Online Dating Industry Care About Age Verification? Many industries fight with fake accounts and bots on the internet. Dating apps aren’t any different in that sense. Age verification measures in online dating can act both as a precautionary measure to prevent underage users and those who create fraudulent profiles. Duplicates and other promotional accounts that want to gain followers on other social media sites like Instagram use fake attractive photos on dating apps to fool others looking for meaningful connections online.   The online dating industry uses age verification for a few important reasons. For example, to: Minimize chances... --- ### 2024 Crypto Theft Statistics: The Imperative Role of KYC and AML in Preventing Digital Asset Fraud > Learn about recent crypto theft statistics and how KYC with AML software helps to combat potential exploits. - Published: 2024-07-11 - Modified: 2024-09-23 - URL: https://www.idenfy.com/blog/crypto-theft-statistics/ - Categories: Blog Learn about recent crypto theft statistics of 2024 and how KYC with AML software helps to combat potential exploits. The report on 2024 Crypto Crime has several trends and statistics on cryptocurrency thefts and frauds. Approximately $430 million was stolen in 50 attacks in the first quarter of 2024. Most of this was caused by one breach concerning the PlayDapp gaming platform. According to Cyentia in Forbes Australia, this depicts the sector's constant vulnerability despite many security measures implemented. The report's key findings draw attention to the fact that these thefts happen, especially in DeFi (decentralized finance) protocols. During the first quarter of 2024, DeFi scams accounted for 60% of all crypto heists, with the main entry being flaws in smart contract codes that hackers exploited (Forbes Australia). While the absolute value pilfered from DeFi protocols decreased through 2023, perhaps due to better security practices and a general decline in DeFi activity, risks remain high—such as that from a compromised private key. KYC requirements are developed to verify users' identities to prevent fraudulent activities and implement requirements. After that, financial institutions, issuing companies, and platforms roll out KYC process implementation within the requirements, which is necessary for collecting and verifying customers' personal data like their full name, address, date of birth, and identification number. Example: During sign-up on a cryptocurrency exchange website, the details and documents required may include personal ones like a passport or a driver's license. The platform then verifies the validity of the documents to ensure that the user is who they claim to be. Impact: This flow helps prevent identity theft, fraud, and fake identity use in financial transactions Few Crypto Theft Statistics The most significant cryptocurrency theft occurred in October 2022, with $775 million lost from 32 attacks. The DeFi ecosystem suffered the most of the attack, with close to 82. 1% lost in DeFi. Most of the attacks were due to vulnerabilities in the company's codes.   How it happened: 64% of these exploits were from cross-chain bridges/protocols, protocols that allow users to move their tokens from one chain to the other. As transactions continued to grow on these chains, they became a target for hackers, as there were millions of deposits guarded by smart contracts. Due to insufficient security measures, the weakness of the smart contract was leveraged to perpetuate the attack. In the first quarter of 2024, $739. 7M worth of cryptocurrency was stolen. Phishing attacks, exit scams, and private key compromises were all part of the reason for this theft. How it happened. A major exploit in February was due to a vulnerability in PlayDapp's codes. PlayDapp is a blockchain gaming platform that offers NFTs and tokens in its ecosystem. The attackers could mint tokens freely twice, which was approximately $290M. Cryptocurrency hacks in 2021 were 60 times higher than in 2018, a 79% increase. One of the major hacks in 2021 was the Ronin network hack, which resulted in a loss of $625M. How it happened. The Ronin Network hack was caused by a security flaw exploited by a hacker who could access Private Keys to authorize transactions illegally. The... --- ### Ensuring Compliance: The Role of KYC/AML in the Tokenization of Real-World Assets (RWAs) > Learn about Real-World Assets (RWAs) and how to build effective compliance process to combat money laundering in crypto. - Published: 2024-07-11 - Modified: 2024-09-23 - URL: https://www.idenfy.com/blog/rwa-tokenization-kyc/ - Categories: Blog Learn about Real-World Assets (RWAs) and how to build an effective compliance program. Real-world asset tokenization is gaining popularity among blockchain enthusiasts due to its potential for ownership opportunities and easier access to luxurious physical items. A recent report from CoinGecko states that "tokenized treasury products grew by 782% in 2023. " This growth highlights increasing interest in decentralizing real-world assets, with platforms innovatively developing tools to enhance operational efficiency in this industry. However, while decentralization is key in blockchain, implementing KYC/AML ensures legal compliance and prevents criminal access to services. This article delves into the crucial role of KYC/AML in tokenizing RWAs. What is the Tokenization of RWA? Tokenization for RWAs involves digitally representing physical assets/items, such as real estate, art, commodities, and luxury goods, as tokens on the blockchain. This allows for verified fractional ownership and transparent transactions. For example, tokenizing real-world assets could enable individuals to own a portion of the Holme, one of the most expensive real estate, valued at $314 million in 2023. How Does RWA Tokenization Work? In tokenizing a real-world asset, what happens behind the scenes is converting ownership rights into digitally accessible tokens. To achieve this, the following steps are followed: Asset Selection: This step involves knowing/choosing an asset you want to tokenize, either tangible or intangible, such as real estate, arts, patents, etc. During this stage, necessary research is done to ensure the specific item to be tokenized meets the standard. Legal Compliance: The specific item to be tokenized must be scrutinized legally and comply with laws and regulations binding such assets. At this stage, the credibility of such assets is known, investors are protected, and all associated risks will be mitigated. Digital Representation: After scrutinized legal research, converting the ownership right begins to take place; this is represented as tokens on the blockchain, thereby ensuring fractional ownership of the underlying asset Integrating Smart contracts: Decentralization is governed by smart contract rules, it cuts off human intervention thereby automating every transactional process, it delivers the supposed result when a criteria is met. Issuance and Distribution: This is done by tokenization platforms. Depending on the type of asset, tokens can be sold on Secondary markets for a wider audience to have access to or sold in an ITO (Initial token offering). These platforms use smart contracts and write the criteria standard for sales. Market Access and Asset Management: After sales, the token becomes easily accessible for crypto nerds willing to invest or trade. At this stage, tokenization/trading platforms monitor assets and investors to avoid illicit activities. Essential Compliance Requirements for Platforms Dealing With Tokenized RWAs KYC (know your customer Verification) KYC is one of the foundational elements needed for tokenization platforms to stay compliant and operate safely in any jurisdiction. Though decentralization is on-chain, issuance of real-world ownership as digital tokens involves a scrutinized process of learning who your investors are and what they are involved with. This process involves getting your investor's personal information, such as identity documents and proof of address, and potentially conducting background checks. In return, this protects the platform from... --- ### Global KYB Compliance: Top 3 Challenges and Solutions [With Examples] > Learn about the key challenges companies face regarding global KYB compliance when scaling into new markets and check out how to avoid them. - Published: 2024-07-09 - Modified: 2024-09-25 - URL: https://www.idenfy.com/blog/global-kyb-compliance/ - Categories: Blog, KYB/AML We discuss the biggest challenges regarding global KYB compliance processes, why automation is inevitable if you want to scale to new markets, and what challenges you can face when integrating KYB into your infrastructure. Know Your Business (KYB) compliance can be a complex task for businesses that operate internationally. That’s because global KYB compliance regulations have multiple levels. Once you peel one, another one appears, depending on the customer, partner, distributor, or entity that you’re verifying. So, it all boils down to the jurisdiction and the type of legal entity.   For example, if the company’s management has Politically Exposed Persons (PEPs), you’ll require additional due diligence procedures, such as verifying the source of funds. Additionally, if you want to enter a new marker, the same rules won’t apply when trying to apply the existing KYB framework in a new country.   That’s why global KYB compliance requires consistency and adaptability, both of which should be considered when determining your company’s risk tolerance, client expectations, and, more importantly, both international and local compliance requirements.   We’ll discuss these nuances in this blog post.   Why a KYB Process Without Automation Ends Up Ineffective  KYB compliance itself is complex. That’s because the regulatory environment is always evolving. Many businesses operate on a global level, which makes it difficult to navigate through different jurisdictions and different requirements. Many companies prioritize KYC compliance while neglecting KYB. As a result, they have streamlined their KYC processes but left KYB operations outdated, relying on large data sets and manual searches. In a traditional KYB process that isn't backed with automation, compliance teams are responsible for manually collecting, verifying, and storing large amounts of data from various sources. This is what a manual KYB process looks like: 🔴 Requires Collecting Extensive Company Data This involves gathering information like the company’s name, address, and business registration number. The company can either set up some sort of form or exchange PDF files through email to receive the data and confirm its legitimacy with the other company that’s being verified.   Related: e-KYB Explained — A Comprehensive Business Verification Guide 🔴 Needs Accurate Beneficial Owner Identification The company looks for beneficial ownership information, which means they are required to contact the other businesses and ask them to provide its ownership information. Sometimes, this can be achieved by manually searching for such data online. Once that’s done, the company will use this data for beneficial ownership identification and in-house KYC checks or use a third-party provider. 🔴 Involves Manual Verification and Important Decision-Making In this stage, the responsible company conducting the KYB check verifies the collected information about the other business. Without automated software, this step is often completed through standard Google searches by manually entering data and cross-checking its legitimacy.   This is important because the company makes the final decision whether it wants to onboard the other company and accept it or decline its partnership. Either way, without automated KYC, the decision is communicated through an email or a simple phone call.   What are the Biggest Challenges in Global KYB Compliance? One of the key challenges in KYB verification and the global markets it comes with is the general justification for... --- ### How to Securely Implement Data Migration For Your Business > Data migration is a risky business, but you can protect your information with the right strategy. Learn how to securely implement data migration with our guide. - Published: 2024-07-02 - Modified: 2024-07-02 - URL: https://www.idenfy.com/blog/data-migration-guide/ - Categories: Blog Learn how to securely implement data migration in your business and avoid common compliance pitfalls. For businesses with reams of data, migrating it to a new location can be a mammoth task with serious security concerns. But there are huge benefits when you move from on-site to cloud storage, or centralize your data in a modern system such as an ERP. The question is, how do you migrate your data while maintaining security and compliance? In this post, we’ll show you how to securely implement data migration for your business and explore some best practices for success. Understanding data migration Data migration is the process of transferring data from one location or environment to another. This involves extracting, transforming, and loading the data (the ETL process) and validating it in the new location, maintaining accuracy and security at all times. So, why might your business undertake data migration? You may want to move data to a new storage location, or from a legacy system to a platform with better functionality. Data migration would be a key part of an ERP implementation, in which you centralize your business data for improved visibility. These are the main types of data migration: Storage migration: transferring data between storage locations Database migration: moving data between database engines or upgrading an existing database Cloud data migration: transferring all data to the cloud, or from one cloud platform to another Application migration: moving software programs between operating environments Data center migration: taking data from a data center to a new operating environment Business process migration: moving business apps, metrics, and data relating to processes into a new environment, for example during a company merger. There are two common approaches to data migration: the “big bang” method and the “trickle” method. The big bang approach sees you migrate all your data at once, which saves time but carries the risk of critical failure. All your systems will be down during the process, so it’s only possible to perform it during non-working hours. It’s most suited to smaller businesses with small amounts of data. With trickle migration, you break the process down into separate phases and move smaller amounts of data with each iteration. You can continue to run the business without downtime, and there’s less risk of a big crash. The drawback is that the whole migration takes a lot longer. How to securely implement data migration One reason for data migration is to move your information to a more secure environment. But you also have to pay attention to security during the migration itself, by recognizing any potential vulnerabilities and putting a security strategy in place. Here’s how. Assess your needs and plan your data migration strategy The first step in any project is to come up with a robust plan. Start by setting clear migration goals, identifying how the project will improve your operations, and defining its scope. Choose whether you’ll use the Big Bang or trickle approach, and set a target timeline for the migration. Now you need to evaluate your current data landscape, making a list of all... --- ### AML Fraud: Types and Detection Measures > Find out how AI and digital assets have changed the AML fraud landscape while accessing the key tips on crime detection and AML automation. - Published: 2024-06-28 - Modified: 2024-09-26 - URL: https://www.idenfy.com/blog/aml-fraud/ - Categories: Blog, KYB/AML Learn how to integrate the integral steps to detect AML fraud and access the latest information about RegTech solutions that minimize manual efforts while ensuring compliance and good user experience in various industries. Companies are responsible for monitoring financial transactions and reporting suspicious activity, which is the starting point for tracking fraud, money laundering, and other criminal financial activities. ACAMS and Thomson Reuters did a recent study in which anti-money laundering (AML) professionals expressed concerns about proper fraud monitoring due to increasing workloads.   This happens to many companies that have high transaction volumes. The amount of data and the growing customer base can lead to an increasing number of fraudulent activities. However, there are many factors that make up this puzzle. Simple things like the lack of a compliance culture in an organization can lead to poor AML process management, which is vital to ensure proper AML fraud detection and prevention.   While it seems common knowledge not to neglect risk assessment protocols and ensure complete compliance with AML standards, many companies still struggle with it. For example, it’s crucial to know who you’re doing transactions with and where their funds come from, especially in high-risk transactions or when dealing with individuals at higher risk of corruption, such as Politically Exposed Persons (PEPs).   So, how big of an issue money laundering and financial crime is today, and how can companies prevent AML fraud and other financial crime from getting involved in their space — we break these and more questions down below.   What is Anti-Money Laundering (AML)? Anti-money laundering (AML) is a set of laws and regulations designed to help companies build processes to detect money laundering activities and other cases of financial crime. AML compliance consists of screening, monitoring, and reporting suspicious activity and is a bigger picture of other related procedures, such as Know Your Customer (KYC) or customer identity verification.   Companies use AML compliance processes in order to: Detect fraud and protect their customers  Avoid non-compliance penalties and reduce costs linked to fines Comply with AML regulations and minimize chances of criminal activity AML is closely related to the counter-financing of terrorism (CFT). Financial institutions and other regulated entities use both regulatory compliance approaches to combat the movement of illicit funds. That’s because AML compliance addresses the source of funds, while CFT compliance focuses on their destination. The Cost of Money Laundering  Thomson Reuters reports that the past decade hasn’t been the best for banks in terms of non-compliance. Regulators in Europe and the US have imposed $342 billion in fines on banks for AML compliance violations since 2019. Another notorious example is the $184 million penalty imposed in 2017 by FinCEN on a money service business (MSB) for failing to maintain an effective AML program and delaying suspicious activity reports (SARs). In general, the cost of money laundering remains an issue globally. An estimated $800 billion to $2 trillion is laundered annually due to businesses unwantedly becoming financiers for money launderers, terrorist networks, drug cartels, and other criminal groups.   Related: What is an AML Compliance Program? What is AML Fraud? AML fraud is the process of illegally laundering money through a company’s products or... --- ### Domestic PEPs and Foreign PEPs — What You Need to Know > Access AML insights on the different types of PEPs and learn about due diligence procedures for identifying domestic or foreign PEPs. - Published: 2024-06-21 - Modified: 2024-09-26 - URL: https://www.idenfy.com/blog/domestic-peps-and-foreign-peps/ - Categories: Blog Learn the risks behind different types of high-ranking individuals, also known as domestic PEPs and foreign PEPs, and explore the tactics that regulators recommend for proper identification and AML screening procedures. Public officials and high-profile politicians have access to numerous resources, which makes them influential individuals. In regulated industries, these people are known as Politically Exposed Persons (PEPs). They are considered to be high-risk and particularly vulnerable to bribery, corruption, and money laundering.   As a result, screening is crucial for such individuals. By assessing risks and applying higher scrutiny to PEPs, companies can avoid getting tangled in unwanted schemes. Naturally, this also helps report and identify risks associated with new clients and ongoing business relationships.   But are all PEPs on the same level of risk? We compare domestic PEPs and foreign PEPs while digging deeper into the epicenter of “political exposure”, in particular, how to adhere to regulatory requirements and manage risks effectively. The Definition of a Politically Exposed Person (PEP) A Politically Exposed Person (PEP) is an individual who holds a high-profile political role or is in a prominent public position, making them more susceptible to financial crime, including bribery or corruption. As a result, PEP is often mentioned in anti-money laundering (AML) compliance guidelines, stressing the importance of stronger due diligence.   Keep in mind that different jurisdictions have different laws and regulations regarding business relationships with PEPs, including factors like identifying a PEP and how to log the former PEP, which is no longer considered a high-risk individual.   Related: PEPs and Sanctions Checks Explained Who are Domestic PEPs? Domestic PEPs are high-risk individuals who hold prominent public functions on a domestic level. That means they are influential people in their own countries and typically have connections with financial institutions.   Domestic PEPs are appointed or elected within their own country. For example, a domestic politically exposed person can be a local senior politician, a political party official, a senior military official, or the head of a state-owned company.   Some key facts to remember about domestic PEPs: The place of residence is not a decisive factor in determining domestic PEPs but can influence the company’s risk assessment. Companies are more likely to have more domestic PEPs as clients than foreign PEPs. ACAMS pinpoints that there’s a level of complexity when dealing with domestic PEPs. For example, PEPs at the provincial or state level also require extra scrutiny. Understanding the key difference between domestic and foreign PEPs helps businesses better manage their risks when dealing with PEPs in general.   However, when a company is onboarding a new customer, it should rely on its internal risk assessment guidelines, which apply to both domestic and foreign PEPs.   Who are Foreign PEPs? Foreign PEPs are individuals who hold or previously had strong public roles in a foreign country. This means the person operates for a different government than the financial institution. Foreign PEPs pose a higher risk profile than domestic PEPs. Some key facts to remember about foreign PEPs: Foreign PEPs who previously held similar positions domestically are still considered high-risk under this category.   Birthplace, current residence, or citizenship do not impact the risk assessment of... --- ### How Does Student Identity Verification Work? > Find out what kind of scams are the most common in the education sector and explore the benefits of automated student identity verification. - Published: 2024-06-17 - Modified: 2024-09-26 - URL: https://www.idenfy.com/blog/student-identity-verification/ - Categories: Blog, Identity Verification Explore the options for student identity verification and find out why universities and e-learning apps choose to onboard their learners using third-party KYC software as a way to prevent unwanted fraud scenarios, including forged documents, like fake student visas. With more e-learning apps to choose from and new remote university opportunities rising, the educational sector has shifted to a more convenient approach to learning. Partially, global events like the COVID-19 situation changed our habits for life, pushing boundaries in mobile banking and other spheres that we wouldn’t have imagined before.   And now, advancements like artificial intelligence have created both new workplaces and some security risks, but, more importantly, they've created new higher education programs for students to study fully online. Education institutions now need to contribute to the growth of the e-learning space by introducing convenient and compliant ways to accept new student registrations — which, naturally, requires a robust student identity verification process.   While remote studying is accepted, there are still loopholes and limitations in properly verifying students. Why? It’s simple. Like in many high-risk industries, banking, identity theft, and all sorts of fraudulent practices are still major issues. When it comes to online education, it’s the same principle. Some abuse student discounts, cheat on exams, or forge documents.   In this blog post, we’ll dig deeper into the e-learning trends and explain how identity verification can help the education industry solve security challenges.   The Definition of Student Identity Verification Student identity verification is the process of assessing a learner’s identity in order to ensure that the student who registers for their classes or certificate is genuine, confirming their identity. In other words, this security measure helps ensure that the student who applied for their degree, for example, is the same student who completed their studies.   That said, student identity verification can be performed continuously throughout a student's enrollment with the learning institution.   Here are some use-case examples showcasing the need for ID verification in the e-learning space: Before taking an exam in college or university Before enrolling in an institution or registering for an app For remote class attendance monitoring Before issuing diplomas or any other academic degrees Before taking applications for student loans or any sort of financial aid What Does the Student Verification Process Look Like? Before remote learning options became mainstream, traditional verification methods meant that students needed to be approved manually. This typically involved assessing students’ government-issued identity documents face-to-face with other faculty members. For example, before accessing on-campus resources, like books in libraries.   Today, student verification differs based on the type of learning institution the person has chosen. So, there are two main verification options: in-person ID verification and online student identity verification, which we discuss in more detail below. 1. In-Person Student Identity Verification Students attending in-person colleges are required to verify their identities periodically. Traditionally, students taking exams are verified either by a campus administrator using a government-issued ID document. Additionally, students often need to scan or show their ID cards to access on-campus resources such as classroom buildings, libraries, and laboratories, as well as when taking important examinations. Typically, educational institutions use personally identifiable information (PII) for identity verification. Examples include: Passport Driver’s license Birth... --- ### How to Combat Document Forgery? > Find out the tops ways fraudsters fake documents, and why automated document verification might be the best solution to stop forgery. - Published: 2024-06-13 - Modified: 2024-06-13 - URL: https://www.idenfy.com/blog/document-forgery/ - Categories: Blog Learn how to spot document forgery by identifying red flags, and see concrete examples of why automated document verification solutions might be the perfect fit for you. Document forgery has been a known crime ever since people became aware of writing and the alphabet. According to “Forensic Document Examination”, laws against forgery date back to 80 BC, when the Romans banned the falsification of documents that were used to illegally pass ownership from one land owner to another. Today, document forgery remains a common white-collar crime, which typically involves changing a real document and creating a fake. For example, deceiving someone by singing in another person’s name. When it comes to identity documents, this is also a common practice in order to use someone else’s identity to gain personal benefits or conduct further crimes. For instance, taking out a loan using another person’s ID document. The most common types of forged documents to this day are fraudulent passports and driver’s licenses. Sometimes, minors use fake ID documents for age-restricted services, like e-commerce platforms that sell alcohol. This is why all sorts of businesses, both operating online and in physical locations, need to build proper verification systems that can combat document forgery in a way that doesn’t disrupt customer experience. What is Document Forgery? Document forgery is the practice of illegally creating or changing documents with the goal of deceiving others. This makes forged documents a type of forgery where real documents are altered without permission. Bad actors often commit this crime in order to make the documents look legitimate for identity theft, financial gain, or to avoid some sort of legal responsibility. People commit document forgery by: Altering real documents Using stolen forged documents Combining data and making new forged documents In general, forgery can also happen when someone pretends to be someone else. This includes various crimes, such as signing another person's name on a document, using another person’s login details to access confidential data, or impersonating an official. Fake Documents vs Document Forgery If a document has false information, it doesn't automatically make it forgery. Fake documents and document forgery may seem similar, but they differ in how they are made because: Fake documents simply imitate real ones, Document forgery involves modifying actual documents. For example, document forgery is using someone else's signature. However, writing a check from a bank account that doesn't have any money is not forgery, even though the person is pretending to have the funds. What are Some Commonly Forged Documents? Traditional physical passports remain the most commonly forged ID documents. The cost of issuing legal identity documents reflects the complexity of forging the document’s security features. Other factors, such as the country's level of technological advancement, also play a significant role. However, scammers sell forged documents and fake passports at low prices on the dark web. For example, you can purchase a fake Australian passport for less than $200. Other elements that are typically easily forged are signatures. Since they can be found on any document, people tend to forge signatures often. For instance, they fake signatures on school reports, vaccine testing forms, voting papers, court documents, and so on.... --- ### Age Verification Law in Texas [2025 updated] > Learn how to implement age verification procedure to comply with the Texas age verification law, passed on the 28th of April 2024. - Published: 2024-06-12 - Modified: 2025-01-22 - URL: https://www.idenfy.com/blog/age-verification-law-texas/ - Categories: Blog, Regulations by Country We've covered the new age verification law passed on 28th of April 2024 by the Texas state and shared the concrete steps to build identity verification procedure. Texas's new age verification law focuses on minors' protection from adult content. The law provides several measures organizations must put in real life to restrict the consumption of pornographic content by minors, for example, making it illegal for children to be forcefully exposed to adult/pornographic content. On average, tweens (age 8 -12) and teens (age 13- 18) spend an average of 5 hours and 8 hours, respectively, on social media. This means minors spend most of their time digitally with only weak or no restrictions on accessing adult-related sites/content. In this article, we will digest how the new age verification law helps protect minors digitally and the penalties involved. Texas HB 1181 explained The Texas House Bill 1181 was controversial before it was finally made effective on September 1st, 2023. Before it became effective, the Free Speech Coalition (FSC) filed a lawsuit against the bill, arguing that it violates the First Amendment. The FSC, the body representing the Adult company, insisted that the bill's requirements for age verification imposed unjustified restrictions on free speech and hindered adults' access to lawful adult content. Despite these arguments, the bill was enacted on September 1st to protect minors from accessing harmful sexual materials on the internet and provide penalties for companies that don't comply. Prior to the Texas House Bill, website operators had little incentive to implement stringent age verification measures under previous regulations. Compliance with basic legal standards was often enough to avoid penalties, and the cost and complexity of implementing more robust systems were seen as unnecessary burdens. As a result, many sites opted for the easiest path, leaving significant gaps in protection. The Texas HB fixes all this to maximally protect minors and also forces adult websites to set up adequate standards to ensure compliance. Failure to do so will result in facing the wrath of the law. The Requirements of HB 1181 The Texas House Bill 1181 prioritizes the safety of minors from the issues that arise from exposure to adult content.   Robust Age Verification Measures: The bill requires a well-structured approach to ensure every user's age is legally verified. This is ensured by requiring government IDs or commercial transactional documents that prove the user's age. Rather than the old way of signing up and choosing unverified dates, this new method ensures every user is older than 18 and aware of their decision. Compelled Speech and Health Warnings: The bill also requires companies or websites with sexual content to display authorized warnings that reflect the danger of the adult content the user is about to watch. Free Helpline Display: The bill also requires companies or websites to display a free helpline that users suffering from mental health or substance use disorders can contact. How to Comply with the Texas HB 1181 Law Several companies have already shut off their services from being accessible to people in Texas due to not being able to comply with the law. With the correct procedure, the changes will make customers more satisfied,... --- ### Customer Risk Assessment: How to Do it Right [Step-By-Step Guide] > Explore the mandatory steps to determine the level of risk posed by a customer in this step-by-step guide for AML customer risk assessment. - Published: 2024-06-07 - Modified: 2024-07-08 - URL: https://www.idenfy.com/blog/customer-risk-assessment/ - Categories: Blog, KYB/AML Learn all about customer risk assessment, factors that help determine the level of risk, automation options, and concrete steps you have to take to comply with AML regulations. Customer risk assessment includes collecting and verifying certain information in order to assign a risk score to a user based on the level of risk. Typically, companies evaluate factors such as age, country of origin, and the nature of the business relationship to assess a customer's risk. This includes examining the customer's identity, location, the source of their funds, and how they intend to use those funds.   Customer risk assessment is also a measure that’s required by anti-money laundering (AML) regulations for regulated entities, such as banks and other financial institutions. They must follow the risk-based approach (RBA). But what other key steps are vital for proper and compliant risk-scoring practices? We explain the details below.   What is a Risk Assessment? A risk assessment is the practice of assessing the risk level linked to a customer based on the risk that they possess within the financial system. This process is a crucial part of AML compliance and is designed to prevent money laundering, terrorist financing, and other financial crimes. This AML measure helps companies to better understand, identify, and mitigate potential risks associated with their customers. Through a proper risk assessment, you can determine if the customer: Poses a money laundering risk. Is a politically exposed person. Is financing terrorism. Appears on watchlists or other blacklists. Is a sanctioned person or a sanctioned business. For this reason, to conduct a risk assessment, companies often verify customer identities and then screen their users against sanctions lists, as well as analyze their transactions in order to detect certain red flags based on factors like their location or services used.   Factors that Determine the Customer’s Risk Profile  Companies should understand various risk scenarios and know how to identify potential issues, including determining appropriate risk profiles for their customers. This way, they can minimize risks, limiting the scope of compliance considerations.   The key factors that help assess and identify customer risk profiles are:  Industry. Transaction values. Types and volume of transactions. Types of products and services offered. Jurisdictions they operate in. Jurisdictions their customers are in. Third parties they deal with. Ownership and operation of these companies. Companies will have varying levels of risk appetite for the customers they are willing to work with, only accepting certain types of business relationships. That said, you should establish certain criteria for customer risk scoring based on your business and associated threats.   The Main Goal of Customer Risk Assessment The key objective of customer risk assessment is to find out more about the customer during and after the onboarding process, determining if they pose any money laundering risks throughout the business relationship.   This is why AML compliance regulations require companies to conduct such assessments and detect AML red flags, as well as key risks, for example, if the customer is sanctioned, has the Politically Exposed Person (PEP) status, or appears on any other criminal watchlist.   That’s why integrating customer risk assessment into a company’s AML program helps to: Identify and... --- ### How Does AML Apply to Crypto? [With Examples] > Find the key AML rules specifically targeted at crypto exchanges and VASPs, which are now required to comply with the Travel Rule. and more. - Published: 2024-05-30 - Modified: 2024-07-10 - URL: https://www.idenfy.com/blog/aml-crypto/ - Categories: Blog, KYB/AML Learn all about crypto compliance, AML regulations, new Travel Rule updates, and what kind of measures are now required for VASPs. The decentralized nature of cryptocurrencies, unfortunately, has created decent opportunities for money laundering and other financial crimes, including terrorism financing. However, more and more legislative changes are coming after shocking events like Binance putting a green light on proxies of the terrorist group. They were often based in sanctioned regions and used cryptocurrencies to convert digital assets into cash, cleaning the dirty money.   To combat such criminal activities, legislative changes needed to happen, and they did. Many jurisdictions passed changes in Anti-Money Laundering (AML) laws, enacting stricter AML legislation to prevent money laundering through cryptocurrency exchanges and custodian services. In 2019, major financial regulators, such as the Financial Crimes Enforcement Network (FinCEN) and Commodity Futures Trading Commission (CFTC), issued a joint statement classifying crypto companies as financial institutions — which meant the same AML rules that were established by the Bank Secrecy Act (BSA).   Such changes required a collaborative effort between crypto platforms to find a unified approach to compliance in order to regulate this industry and avoid misinterpretation. However, as a very user-centric industry where identities sometimes want to be protected, some crypto players still fear that complying with AML regulations means more complicated transactions and extra friction to the end-user experience.   What Does Anti-Money Laundering (AML) Mean for Crypto? Anti-Money Laundering (AML) for cryptocurrencies refers to laws, regulations, and policies designed to prevent criminals from fraud and various financial crimes, such as converting illegally obtained cryptocurrencies into cash. In general, AML compliance requires crypto companies and other financial institutions to verify customers' identities through processes known as Know Your Customer (KYC). More importantly, AML regulations mean that all regulated entities must monitor transactions for suspicious activities, flag AML risks, and report suspicious activities to relative authorities.   Why are AML Processes Vital for the Crypto Sector? AML procedures enhance the reliability and security of transactions on crypto platforms, underscoring their critical importance. By protecting users through more stringent requirements, like the Travel Rule, crypto players are now on the same level as standard financial institutions in the sense that they stabilize the whole market and adhere to global AML standards by preventing non-compliance, such as sanctions violations.   AML measures are vital in this industry also due to cryptocurrencies and their nature. Due to the accessibility of digital assets and overall financial inclusion, over the years, crypto has proved to be a “reliable” channel for illicit activities. The low-cost crypto transactions also make them appealing for crime. Using crypto, fraudsters might try to move illicit funds with minimal digital footprints, making the detection challenging. Companies new to crypto exchanges often have incomplete AML processes and lack proper specialists or AI-powered RegTech solutions in their internal AML programs. What’s more, the lack of clarity in the AML frameworks around reporting requirements, particularly in cross-border transactions, results in AML compliance breaches. However, some experts speculate that sectors like DeFi will be regulated as well. This is linked to the goal of helping private companies and governments to... --- ### How Does Driver’s License Verification Work? > An in-depth explanation driver's license verification guide, providing concrete examples and the key perks of such document checks. - Published: 2024-05-28 - Modified: 2024-07-15 - URL: https://www.idenfy.com/blog/drivers-license-verification/ - Categories: Blog Find out why so many platforms incorporate driver’s license verification into their onboarding flow and why it’s considered the go-to method to achieve a simple and efficient Know Your Customer (KYC) process. It’s convenient to pick up any vehicle, rent it, and then drive to your desired destination without needing to have your own car or driver. As the shared mobility sector becomes more popular, it has proven its value both to its users and businesses. According to McKinsey research, throughout recent years, various private equity firms and other players have invested more than $100 billion in shared mobility entities. One crucial aspect contributing to the industry’s success is the implementation of security measures, such as driver’s license verification.   Like many customer-centric industries, user experience stands at the top of the priority list, next to compliance and security. So, even though there are many identity verification solutions and automated Know Your Customer (KYC) tools in the market today, remote driver’s license verification is the go-to pick for businesses in the shared mobility sector. Asking the user to download the app and upload a photo of their driver’s license before they can access the vehicle is a common way to verify someone’s identity and age and, more importantly, check if they’re qualified to drive.   Driver's licenses are commonly requested as a government-issued document during user onboarding for various digital platforms. That said, this type of verification isn't exclusively tailored for the shared mobility industry. We’ll discuss the specifics, including main uses and features while explaining the step-by-step process of driver’s license verification. What is Driver’s License Verification? Driver’s license verification is the process of confirming that the person’s driver’s license is valid and belongs to the rightful owner. In other words, this form of verification helps assess the authenticity of the document and verifies their identity, including important details like the person’s age.   While driver’s license verification is mainstream in the sharing mobility or transportation industry mainly for its capabilities to onboard many different types of users on apps, such as renters, drivers, and ride-sharers, in order to minimize paperwork, it’s used for other purposes as well. Businesses that sell similar age-restricted items or services also rely on driver’s license checks. For example, adult content apps and e-commerce platforms that sell goods like alcoholic beverages can use license verification as a way to guarantee that they’re not accepting minors into their network. This is considered a more secure way to approve a person’s age compared to relying on a standard age gate with a checkbox, which can be easily bypassed. The Role of Driver’s License Verification in KYC and AML Compliance From luxury goods auctions to sharing economy services or standard banks — these are all regulated entities that need to stick to KYC and anti-money laundering (AML) compliance requirements. Various digital service providers, including famous examples such as Airbnb and Uber, can’t be built solely on trust. They often use driver’s license verification as part of their remote identity verification process. This way, they can ensure security and comply with KYC/AML rules. Beyond compliance and the use of ensuring adherence to these regulatory standards, companies aim to keep fraudsters... --- ### Money Laundering in Forex Trading [AML Risk Guide] > Currencies are traded online in the biggest Forex trading market in the world, but with that, an even bigger issue arises — money laundering. - Published: 2024-05-10 - Modified: 2024-07-17 - URL: https://www.idenfy.com/blog/forex-trading-aml/ - Categories: Blog, KYB/AML The forex market isn’t an exception and, like many high-risk industries, is associated with money laundering risks. Learn how to build a proper AML program for your forex trading business, find out how to identify key red flags, and more. Foreign exchange (FX), or forex trading, is one of the biggest financial markets in the world right now, still winning the race against other spheres like decentralized cryptocurrencies or stocks.   According to the New York Stock Exchange the forex market has an impressive trading volume, which is about $200 billion daily on average. Due to this level of demand, the forex market is open 24/7; however, a large portion of the trade comes from billionaire traders or well-established hedge funds rather than standard retail traders.   So, even though the FX market has welcomed many of its traders with open arms, the door was opened for all sorts of individuals with bad intentions. Money launderers use various FX businesses to use weaknesses in the system for their advantage, both in the commercial and the banking sectors. In general, diverse entities provide FX services, including brokers, investment firms, or simple money transfer companies.   That said, if you’re operating in the forex trading landscape or have any ties with FX businesses, you should consider learning about specific money laundering risks that this sector creates. In this blog post, we’ll explore Anti-Money Laundering (AML) risks and complex use cases when criminals use this exploitable marketplace for their own “good”.   What is Forex (FX) Trading? Forex (foreign) trading is the process of exchanging different international currencies in a global market, which involves simultaneously selling and buying currencies for trillions of dollars daily. Despite lacking a centralized physical location, the forex market is the world's largest and most liquid financial market. Its convenience makes it highly favored by a variety of traders, including banks and fund managers. Forex trading operates as an over-the-counter (OTC) market. That is why there is no centralized exchange control. Often, currencies are traded electronically through a network. Financial players, such as corporate company merchants, also trade in this market. When someone purchases from a foreign country, they make the payment in the currency of that country. That’s why traders study exchange rates that show how another currency will restore one currency and invest in currencies they think will become more profitable in the future.   How Forex Trading Actually Works Forex trading revolves around speculation, similar to how people sell and buy stocks. There’s an interbank market where both commercial and investment banks operate. While forex traders aim to buy currencies at a low price and sell them at a higher price to make a profit, big players like JPMorgan Chase & Co. also act as market makers and have influence over the exchange rates.   However, unlike stock traders who deal with shares, forex traders trade currencies. An investor can benefit from forex trading by capitalizing on fluctuations in currency values. That means they can profit when the base currency increases or decreases in value. For example, when the US imports agricultural products from foreign countries like India, payments are typically made in the exporting country's reserve currency, and in this case, Indian Rupee. Why the... --- ### Source of Funds (SOF) and Source of Wealth (SOW) Checks [Guide] > Compare Source of Funds (SOF) with the Source of Wealth (SOW) check and access the key steps for a proper AML and KYC compliance program. - Published: 2024-04-30 - Modified: 2024-07-18 - URL: https://www.idenfy.com/blog/source-of-funds-sof-and-source-of-wealth-sow/ - Categories: Blog Get a bigger picture of the intricacies surrounding Source of Funds (SOF) and Source of Wealth (SOW) checks. Discover the main challenges in AML and KYC compliance, and learn the best practices that will help you enhance your compliance procedures and mitigate the risks of money laundering. Source of Funds (SOF) examines how and where the client got the money for a specific transaction. On the other hand, Source of Wealth (SOW) explores the bigger picture, or the client’s entire financial situation and how they built up their total wealth. Both SOF and SOW verification are key elements of Know Your Customer (KYC) protocols, recommended by the Financial Action Task Force (FATF) for anti-money laundering (AML) efforts. These checks verify the legitimacy of your customers' funds and ensure they aren't linked to risky or illegal activities, helping you better understand a client's risk profile. But why are these checks important, and what are the main differences between them? This simple guide answers all these questions and explores key topics, such as the regulatory landscape and issues linked with Source of Funds (SOF) and Source of Wealth (SOW). What is Source of Funds (SOF)? Source of Funds (SOF) describes the origins of where the money in a specific transaction or investment comes from. This can be proceeds from selling a property, gifts, personal savings accounts, or even gambling winnings. Companies gather this information from their customers to verify that the transactions are not being used for money laundering and other financial crimes. SOF verification involves tracing the money back to its original source to ensure it was acquired legally. In practice, companies ask the customer to provide proof, such as pay slips or bank statements confirming the sale of an asset. If the funds originate from the customer’s business, the company can ask for business financial statements or transaction records to confirm the money was earned legally. Source of Funds (SOF) Examples Some common examples of Source of Funds (SoF) include: Income from employment Personal or joint savings accounts Inheritances or gifts received Compensation from legal settlements Profits from investments or legitimate business activities or  Proceeds from the sale of assets such as stocks or real estate So, if a customer wants to invest a significant sum in a mutual fund, the financial institution will need to conduct an SOF check and: Evaluate the risk level associated with the transaction by considering factors like the presence of a gift, the origin of the funds, and the complexity of the transaction structure. Request documentation like bank statements or records that trace the money back to its source, such as the customer's salary, a gift from a family member, or proceeds from a business sale. Record the decision-making process, noting the reasoning and any relevant details, in the client's file for future reference. This helps verify that it matches expectations and that the client’s explanation is consistent with their known background. Criminals often attempt to inject their illegal funds into the financial system by concealing their origins through layering. That’s why verifying the Source of Funds is crucial for identifying, preventing, and reporting potential money laundering. What is Source of Wealth (SOW)? Source of Wealth (SOW) refers to the origins of the person’s total wealth that they have acquired throughout... --- ### 6 Steps to Conduct a KYB Verification Check [Guided Explanation] > Get an accurate overview of the KYB verification process for you to perform efficient checks on your corporate clients using KYB automation. - Published: 2024-04-29 - Modified: 2025-05-02 - URL: https://www.idenfy.com/blog/kyb-verification-check/ - Categories: Blog, KYB/AML Discover the specific steps and examples of how to conduct a compliant Know Your Business (KYB) verification process. There isn’t a checkbox for Know Your Business (KYB) identity verification in terms of what you should screen, but there are general regulators that have universal recommendations.   For example, the US’ KYB process is regulated by the Financial Crimes Enforcement Network (FinCEN) and its Customer Due Diligence (CDD) Final Rule, which mandates that institutions like fintechs, cryptocurrency firms, mutual funds, commodities brokers, and other financial service providers that are stipulated in the Bank Secrecy Act (BSA), should implement identity verification both for corporate and individual customers.   In general, when you’re a regulated entity, you should follow your local and global anti-money laundering (AML) policy, which involves implementing KYB. What makes KYB checks different from Know Your Customer (KYC) checks is the scope and complexity of data that needs to be verified. Additionally, smaller businesses worry about the resources regarding KYB because they need to check and comply with the law in every jurisdiction where they operate.   If you are not regulated, you, as a company, can conduct KYB on your business clients in order to mitigate risks of fraud, money laundering and terrorism financing. So, what exactly does it take to verify your partners and ensure their legitimacy? Below, we explain the intricacies of this process in concise terms, as well as provide actual solutions that can simplify your KYB onboarding. What is Know Your Business (KYB) Verification? Know Your Business, or KYB verification, is a process designed to verify the legitimacy of other businesses you work with before initiating a business relationship with them. This could be any stakeholder company or a third-party, such as a supplier, that you work with.   KYB verification is an ongoing due diligence process consisting of multiple checks that monitor changes in your clients’ risk profiles. This makes KYB a complex process, especially for companies that are required to conduct these screenings due to mandatory AML compliance requirements. However, many unregulated entities also use at least some sort of business background checks for their internal risk assessments.   In short, companies that use KYB verification have two goals: To follow regulators’ policy. To avoid internal fraud risks or fraudulent partners and third-party suppliers. This makes KYB verification crucial as it enables firms to understand who they’re dealing with — avoid partnering with shell entities that exist merely on paper for illicit reasons — and determine the necessary level of due diligence to apply to each customer’s account. Related: Know Your Business — Quick-Start Compliance Guide What is KYB as a Service? KYB as a Service is automated third-party KYB software that helps companies collect data and save time on traditional manual Know Your Business verification tasks, such as checking the different types of beneficiaries, sending out specialized questionnaires, verifying related shareholders’ identities, reviewing government databases, etc.   This as a service model doesn’t require building and developing a KYB process in-house from scratch, meaning that you can implement a solution that comes from a RegTech provider who provides you with... --- ### Get Ready for Your AML Audit [Best Practice Guide] > Learn what processes should be included in your AML audit strategy and grab some tips for automation solutions to complete your AML program. - Published: 2024-04-25 - Modified: 2024-07-24 - URL: https://www.idenfy.com/blog/aml-audit-guide/ - Categories: Blog, KYB/AML Understanding how to select the right automation tools, assessing the effectiveness of internal controls like prepared reports, and setting the scope and frequency of an AML audit can be challenging. Learn how to verify the effectiveness of your AML program with a straightforward AML audit guide. It seems that regulatory expectations just keep getting higher. Along with them, financial institutions and other regulated entities need to get up to speed with various anti-money laundering (AML) and counter-terrorist financing (CTF) policies and controls. One of them is an AML audit, which serves a vital role in a company’s AML program.   Instead of looking at an AML audit as a mere regulatory burden, consider it as an opportunity to take a proactive stance. By going the extra mile and building a robust anti-money laundering strategy, you not only meet regulatory requirements but also gain control over your AML program. This strategy, when carried out regularly and adapted to the ever-changing regulatory landscape, can significantly enhance your institution's financial security.   Below, we explore the practical measures that help you build a proper AML auditing system, share tips on evaluating your AML compliance program, and identify and rectify any gaps along the way.   What is an AML Audit? An AML audit is an evaluation process of the company’s AML/CTF program. It helps assess how well an organization complies with anti-money laundering regulations, pinpointing any weaknesses and suggesting improvements for key compliance measures, such as internal controls, customer due diligence (CDD) processes, and transaction monitoring systems. An AML audit’s main goal is to help you review and assess how adequate and effective the company’s AML policies, controls, and procedures are. In other words, your AML audit should assess whether your compliance program: Is functioning as planned.   Meets all legal obligations.   Effectively addresses money laundering risks and other crimes like fraud and terrorism financing. By conducting an AML audit, you can determine whether all AML controls are implemented effectively and if they’re functioning in a successful and compliant manner. The True Meaning of Anti-Money Laundering (AML) When we talk about AML, we refer to the laws, strategies, procedures, and regulations designed to prevent illegally obtained money from being integrated into the financial system. AML compliance is a term that describes unified rules governments worldwide have established in order to help local and global institutions to monitor and address money laundering and other financial crimes. For example, in the US, the Financial Action Task Force (FATF) was established as a leading entity to fight money laundering and financial crimes. In the meantime, the EU and many of its member states are also part of the FATF and follow key regulations such as the Anti-Money Laundering Directives (AMLDs).   Why are AML Audits Important? The most important factor of AML audits is regulatory compliance, which makes the auditing process a mandatory requirement for regulated industries. However, looking into the bigger picture, AML audits are vital steps of AML programs, helping you prevent getting tangled in fraud and all sorts of financial crimes or even unknowingly filtering illicit money into the general financial system.   Regular AML audits mean that you’re updated with changes in the regulatory landscape and are able to achieve three key steps: Establish an effective independent... --- ### What is the Crypto Travel Rule? An Overview > Thresholds, numerous FATF recommendations and specific steps VASPs must consider if they want to stay compliant with the Crypto Travel Rule. - Published: 2024-04-22 - Modified: 2024-07-24 - URL: https://www.idenfy.com/blog/crypto-travel-rule/ - Categories: Blog Explore the Crypto Travel Rule and learn what data needs to be collected, who qualifies as a VASP, as well as the necessary steps and tools for crypto platforms to comply with the FATF guidelines. The Crypto Travel Rule is mandated by the Financial Action Task Force (FATF), a global anti-money laundering (AML) watchdog. In 2019, the FATF expanded its recommendations to cover virtual assets (VAs) and Virtual Asset Service Providers (VASPs). Since then, companies involved in cryptocurrency and DeFi must comply with stricter regulatory guidelines, also known as Recommendation 16 or the "Travel Rule,” which is part of FATF’s 40 Recommendations. Initially adopted in 2016 and updated again in 2021, the Crypto Travel Rule applies to businesses handling crypto transactions. It mandates VASPs and financial institutions involved in VA transfers to share transaction details, including sender and receiver information, above a specified threshold to combat money laundering and illicit activities. Countries use different terms to categorize crypto service providers. Some alternative terms to VASPs include Crypto Asset Service Providers — or CASPs — Money Services Businesses — or MSBs — and so on. The most common reporting transaction threshold for companies is set at $1,000. However, in the United States, it's $3,000.   Businesses must comply with the Crypto Travel Rule to avoid extra scrutiny or be declined altogether. Regular crypto users are now also required to disclose their identity to exchanges and service providers. Therefore, it's not just important but crucial for businesses to fully understand the impact of the Travel Rule and ensure they are in compliance with these regulations regarding crypto assets. What is the Crypto Travel Rule? The Crypto Travel Rule, or FATF Recommendation 16, is a set of guidelines designed to prevent money laundering and terrorist financing. It specifically targets financial institutions involved in virtual asset transfers, and crypto companies, referred to as VASPs. The Travel Rule ensures that personal data accompanies transfers. Recommendation 16 pertains to both international and domestic wire transfers. According to FATF Recommendations, its goal is to hinder "terrorists and other criminals" from freely using wire transfers to move their funds and to identify and prevent such misuse. Related: 40 Recommendations of the FATF The Role of the FATF in the Context of the Travel Rule The Crypto Travel Rule is mandated by the Financial Action Task Force (FATF). It is an intergovernmental body involving G-7 countries and approximately 30 others who are responsible for various policy initiatives.   The FATF introduced the Travel Rule in order to help law enforcement agencies and obliged entities involved in sending and receiving funds through formal funds transfer systems. This law aims to better prevent, detect, and prosecute activities mainly related to: Money laundering Terrorism financing Sanctions breaches Other financial crimes The interpretation and enforcement of the Crypto Travel Rule vary among regulators. While pioneers like the United States have embraced it early on, others, for example, the United Kingdom, only recently integrated its principles into their regulatory framework, marking their adoption in August 2023. Why is the Crypto Travel Rule important? The Crypto Travel Rule is important because it: Enables law enforcement to request and access transaction details from VASPs and crypto companies.   Helps tracking illicit... --- ### Third-Party Money Laundering Risks Explained > A deep dive into third-party money laundering risks, and what that means for businesses — from large-scale banks to small startups. - Published: 2024-04-17 - Modified: 2024-07-25 - URL: https://www.idenfy.com/blog/third-party-money-laundering/ - Categories: Blog We dig deeper into how third-party money laundering can harm a company's reputation, explain how to monitor suspicious activity, and go through the top key measures that can prevent such risks. Third parties, such as suppliers, partners, vendors, or other service providers, often have access to internal company or customer data, systems, processes, or other sensitive information. If a business collaborates with supply-chain partners or outsources at least a part of its operations, the company automatically should be aware of third-party money laundering risks.   Third-party risk, especially in the context of money laundering, is a significant concern for businesses of all sizes, from large corporations to small enterprises. Vendors can use client accounts to hide money from illegal activities. To prevent this, companies should verify not just their customers but also their partners, where the money is coming from, and if any third parties are involved.   Money laundering is a big worry that these third parties can bring to both the supply chain and the company. There are other dangers, too, like compliance challenges, legal problems, and harm to the company's reputation.   That’s why companies should actually prioritize compliance and data protection and not rely only on outdated tools or practices that lack proper security measures to keep customers safe.   What is Third-Party Money Laundering? Third-party money laundering is the process of using another company, like a payment service provider or supplier, to hide illicit funds. This can happen through different methods, for example, through trade-based schemes, or online payment platforms. Sometimes, third parties might “help” with money laundering schemes unknowingly. Criminals use intricate ways to exploit third parties. For example, they use trade-based money laundering to manipulate trade transactions and move illicit funds across borders. Using this form of third-party money laundering, criminals falsify trades and exploit international trade complexities, blending dirty money into the legal economy. The Role of the Supply Chain and Third Parties A supply chain consists of all participants involved in creating and delivering a product, from raw material producers to end consumers. It requires a seamless flow of all activities for it to work.   Third-party entities can serve as: Suppliers Logistics provider Distribution centers Understanding the role of third parties is vital for businesses aiming to optimize their supply chain and ensure smooth product delivery. Third-party relationships enhance a company's capabilities by providing expertise in navigating regulations like legal compliance. They also offer valuable insights and fresh perspectives for long-term business development opportunities.   While this looks like pure benefits for companies, there’s a darker side to the operational landscape of third parties. Carefully managing third-party relationships is crucial to maximize benefits and mitigate risks like money laundering.   Why are Third Parties Vulnerable to Money Laundering? Money laundering through third parties uses legal transactions to hide where illegal money comes from. Criminals choose this channel on purpose because it helps them keep their distance from the dirty money, making it harder to detect and follow.   What’s worse is that although the main company might have strong internal anti-money laundering (AML) compliance measures, third-party companies may not stick to the same level of scrutiny against money laundering activities. Third... --- ### How Can You Detect Arbitrage in Sports Betting? [Simple Guide] > Explore the antics behind arbitrage in sports betting and learn how arbers try to avoid bookies and earn profit without getting blacklisted. - Published: 2024-04-11 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/arbitrage-sports-betting/ - Categories: Blog Learn what arbitrage in sports betting is, how arbers try to avoid getting caught by skilled bookmakers, and what it takes for companies to actually prevent unwanted arbing activities. Imagine watching a tennis match and placing two bets on each player to win. Or in football — one on a draw and the others on each team to win. This is exactly what arbitrage in sports betting is. Barbers are known to place bets on different companies or within the same betting company to gamble and cash out the profit strategically.   To execute their plans correctly, bettors capitalize on discrepancies in odds offered by various bookmakers and betting platforms. Essentially, arbers use their bets on both potential wins and losses, and, this way, they make an overall profit regardless of the actual result. Often, success in arbing relies on automation designed for arbitrage sports betting.   So, how to detect arbitrage and not lose profit? We discuss the focal points below.   What is Arbitrage Betting? Arbitrage betting, also known as arbing, is a gambling tactic where bettors place simultaneous bets on all possible outcomes of a sporting event, ensuring a guaranteed profit no matter the outcome. In sports, arbing involves exploiting differences in odds available for a sports event. Betters who use arbitrage betting are called "arbers. " Some of them use bots for efficient placement of multiple small wagers while aiming to stay under the radar to evade bookmakers' attention. Arbers capitalize on odds variations across different bookmakers and sites, which is why automation helps in this sense. Besides standard arbitrage betting, other common strategies include:  Bonus hunting arbitrage. This involves profiting from different bonus offers across various betting platforms. It's a common occurrence when a player first opens their account with a bookmaker. They often give them a bonus if they deposit a minimum fixed amount. Cross-market arbitrage. Such bets are a mix of varying markets. The goal is to take advantage of differences in bookmaker pricing by using two or more markets. The difference between odds is an "arb. " Bookmakers assert that arbitrage betting risks their operations. That’s why betting companies actively work to detect it and try to establish effective limits that minimize arbitrage.   Arbitrage Betting Examples Arbitrage betting is very popular in the horse racing industry due to the frequent changes in betting prices. These significant fluctuations offer greater profit potential for arbers. By placing simultaneous bets on the same horse with a bookmaker and against it, bettors can quickly secure profits. The markets for football, basketball, and tennis also see considerable activity in arbitrage betting. For example, tennis matches with only two possible outcomes — Player 1 wins or Player 2 wins. Imagine a final match between Roger Federer and Rafael Nadal in the French Open. Nadal, favored for his skills, is more likely to win. However, various bookmakers offer differing opinions, each incorporating their own profit margin into the odds. By placing a total bet of, let’s say, $400 across both bookmakers, betters secure a win, ensuring at least a minimum profit. How Does Sports Betting Arbitrage Work? Here’s an illustration of a possible scenario showing how sports... --- ### eIDAS Regulation: What You Need to Know > Learn about the eIDAS Regulation, its requirements, the impact on public and private sectors, as well as the history and meaning behind it. - Published: 2024-04-03 - Modified: 2024-11-08 - URL: https://www.idenfy.com/blog/eidas-regulation/ - Categories: Blog, Regulations by Country Find out what eIDAS is, its history, importance and the key steps that are required to build a secure and compliant identity verification aligned with these regulations, ensuring digital trust and security. One of the key regulatory frameworks that has influenced digital identity verification is eIDAS, which stands for Electronic Identification, Authentication, and Trust Services. It’s a regulation designed to enhance the safety, speed, and efficiency of electronic interactions between businesses across European countries. Incorporating electronic identification and trust services into your business can provide a bunch of benefits, such as increased security or better user experience. More importantly, the eIDAS regulation establishes a unified framework for electronic identification (eID) and trust services, simplifying the process of delivering services throughout the European Union. So, in the landscape of digital transactions and online services, verifying digital identities and preventing financial crimes are essential for businesses. This is where solutions that are compliant with eIDAS merge with Know Your Customer (KYC) processes and bring a completely new security standard. What is eIDAS? eIDAS, or Electronic Identification, Authentication, and Trust Services, is a regulatory framework implemented by the European Union. Its purpose is to standardize the framework for eID and trust services, simplifying the delivery of such services across the EU. eIDAS facilitated interoperability among the 27 EU Member States. It was introduced in 2014, ensuring mutual recognition of each other's notified electronic identification schemes. The Regulation guarantees that trust services offered by compliant service providers can be accepted as evidence in legal proceedings. eIDAS regulation seeks to elevate the security and dependability of electronic transactions, bringing several key benefits for businesses: Streamlined business operations for enhanced efficiency. Reduced administrative workload in electronic transactions with other businesses, customers, and public administrations. Substantial cost savings and improved profits. Safer electronic transactions and increased consumer trust. eIDAS ensures that electronic identifications and trust services are interoperable and legally acknowledged throughout the EU. This includes services like digital signatures, e-delivery services, electronic seals, or website authentication.   eIDAS Beyond the EU After Brexit, the UK adopted the eIDAS Regulation into its own law. While it might not be legally binding in other jurisdictions, it's common for businesses or citizens outside Europe to use eIDAS infrastructure, especially if they have substantial operations or business interests in the participating states. According to eIDAS regulation, citizens and businesses have the right to use their national eIDS when accessing online public services in other member states also using eIDS. This arrangement establishes a European internal market for trust services, guaranteeing their functionality across borders. eIDAS Standards on Different Identification Methods The eIDAS regulation sets up a legal framework governing various electronic identification methods. It establishes standards for electronic signatures, seals, timestamps, documents, registered delivery services, and certificate services for website authentication.   Under the eIDAS Regulation, trust services benefit businesses in various ways, for example:  Electronic signatures. Qualified electronic signatures hold the same legal weight as handwritten signatures. Electronic seals. Similar to traditional business stamps, they ensure document origin and integrity when applied electronically. Electronic timestamps. Links electronic documents to specific times, providing evidence of document existence. They are issued to guarantee that the time associated with data or documents is accurate.... --- ### The Risks of Shell Companies in Money Laundering > Learn how shell companies manage to launder millions, their key tactics for illegal activities, and what solutions identify such crimes. - Published: 2024-03-29 - Modified: 2024-08-02 - URL: https://www.idenfy.com/blog/shell-companies-money-laundering/ - Categories: Blog, KYB/AML Shell companies can hide ownership and transactional details from regulatory and law enforcement authorities, which makes them less transparent and, at the same time, more attractive for fraudsters to use for money laundering. Read more. Shell companies, also known as ghost companies, have a notorious label attached to them. That’s because they’re often used for illicit purposes, especially for money laundering schemes. They have the “shell” part in their name because they are hollow or empty—since they don’t have any active business operations.   Such enterprises without real operations, also known as shell companies, can be set up either in the US or in other countries. For example, even though all states have laws regulating the establishment of limited liability companies, most of them do not mandate the disclosure of ownership information to state governments during their formation or afterwards. Establishing such companies abroad is also a common choice for people who want to avoid paying taxes. So, just like any tool, such ghost companies can be used for money laundering when in the hands of those with malicious intentions. In this blog post, we’ll dive deeper into the specifics and learn how shell companies help get away with such crimes.   The Definition of a Shell Company A shell company is a type of business often formed to safeguard or conceal the assets of another company. A shell company can be created both for legitimate and illegal reasons. Such businesses usually don't have a real office, don't hire employees, and don't generate much income on their own.   Shell companies are described as those who exist only on paper because they: Lack physical locations. Don’t have any employees. Do not generate steady income. Occasionally hold bank accounts or investments. Often are entirely inactive. Shell Company Examples The Panama Papers leak in 2016 is a perfect example of the modern history of shell company money laundering. It showed how such enterprises can be used globally for large-scale money laundering. Because of the leak, tax authorities got about $500 million and started cases against people and businesses involved. This scandal revealed that shell companies were set up in places with weak rules, like the British Virgin Islands. And on top of that, many parties that were involved were connected to powerful families and politicians.   Generally, there are a few typical examples of shell companies commonly used for money laundering, such as: Real estate investments. Shell companies buy expensive properties. Criminals change who owns these properties several times on purpose to hide the real owner. If caught, authorities can seize properties bought illegally, causing financial losses.   Offshore accounts. A shell company is created in a tax haven. Money is put into the company's account to make it seem like legitimate business earnings. In general, offshore refers to business activities conducted outside an entity's home country. This term describes foreign banks, investments, deposits, and corporations.   Phantom services. A shell company sends invoices for services that were never actually done, making illegal money look like payment for real services. Phantom companies or trusts are common channels that international criminals and corrupt businesses use to hide money and cheat governments. While shell companies can be registered anywhere... --- ### e-KYB Explained — A Comprehensive Business Verification Guide > The key steps and business verification solutions explained for you to switch from non-efficient KYB processes to an AI-powered e-KYB flow. - Published: 2024-03-28 - Modified: 2024-08-06 - URL: https://www.idenfy.com/blog/e-kyb-business-verification/ - Categories: Blog, KYB/AML Learn how to prevent partnering with illegitimate companies and build trusted business relationships easier with a streamlined approach to business verification — e-KYB. Business verification has become a vital process for companies to avoid getting tangled with high-risk entities. With the right technology and automation, ensuring Know Your Business (KYB) compliance is possible without causing delays for customers. This is where e-KYB, or Electronic Know Your Business comes into play — a key component of the company’s Anti-Money Laundering (AML) program.   e-KYB helps businesses answer fundamental questions regarding their business relationships, including solving security challenges. For example, it can help businesses determine whether a potential partner is reputable and dependable and identify legitimate transactions by breaking down the true owners of the business.   In simpler terms, e-KYB processes assist companies in identifying their customers and understanding their financial activities. But what specific steps must companies take, and how can they prevent losses from fraud and non-compliance? We'll address these and other key questions below. What is e-KYB? Electronic Know Your Business (e-KYB) is an advanced method for corporate identity verification, helping companies to comply with AML and Counter-Terrorism Financing (CTF) regulations. e-KYB is designed to verify the companies you are interested in or currently involved with, whether they are customers or service providers, along with the individuals associated with those companies. e-KYB helps businesses achieve these process goals: Verify if a person's position allows them to represent a company Confirm a person's ownership stake in a company Verify a company's financial information Validate company documents to reduce business risks e-KYB also serves as an electronic alternative to traditional KYB methods. That’s why e-KYB solutions help streamline various tasks such as data gathering, verification, and risk assessment to ensure compliance with regulatory requirements and to enable informed decisions when onboarding new corporate clients. How Does e-KYB Work? e-KYB works by identifying companies and avoiding partnering with high-risk entities. To achieve this, organizations use e-KYB to check whether the corporate entities they engage with are legitimate businesses or shell companies. Although shell corporations aren’t automatically all fraudulent, they are typically assessed with caution in mind.   As a result, e-KYB helps detect fraudulent shell companies and illicit companies in general by breaking down another company's ownership structure, conducting proper due diligence, and ensuring that the entity isn’t engaged in financial crime.   Due diligence involves assessing customer risk to gain insight into potential business partners. The CDD Final Rule mandates that financial institutions identify and verify the identity of ultimate beneficial owners (UBOs). That’s why it's essential to verify both the company and its beneficial owners — the individuals who profit from the company — to stay compliant with KYB regulations.   Examples of KYB Regulations for the e-KYB Process Here are the key regulatory compliance laws that businesses should follow when building their e-KYB procedures: The Bank Secrecy Act (BSA) Anti-Money Laundering Directives (AMLDs) The CDD Final Rule In general, to comply with AML/CTF regulations, companies must establish the identity of their corporate/individual customers and understand their financial activities, which means they have to conduct Business Verification checks, which can involve a... --- ### Transaction Screening vs Transaction Monitoring [AML Guide] > Find out what steps are required for both an effective transaction screening and transaction monitoring processes in oder to comply with AML. - Published: 2024-03-22 - Modified: 2024-08-07 - URL: https://www.idenfy.com/blog/transaction-screening-vs-transaction-monitoring/ - Categories: Blog, KYB/AML Explore the key differences between transaction screening and transaction monitoring processes, learn why they’re vital for AML compliance, and find out the best ways to manage emerging fraud risks. Transaction screening and monitoring play vital roles in detecting and preventing money laundering, counter-terrorism financing (AML/CFT), and other types of fraud. Both processes are vital for businesses, as to this day, money laundering presents a major challenge globally, with annual figures ranging from $800 billion to $2 trillion. The inability to identify and stop the laundering of such large amounts of money carries consequences, including fines for financial institutions and lost tax revenue for governments. Consequently, governments have a strong motivation to combat money laundering, leading to a unified approach of strict AML regulations worldwide. For example, the Financial Action Task Force (FATF) has issued a set of 40 recommendations urging governments to adopt measures like screening and monitoring to mitigate the risks associated with money laundering and other crimes. To put it simply, while both transaction screening and transaction monitoring are separate concepts, they share similarities. Screening involves assessing risks before the transactions. In the meantime, monitoring is linked to assessing transactions and accounts after they have taken place. In this blog post, we take a closer look into both processes, finding out the key details and why they’re important for AML compliance.   What is Transaction Screening? Transaction screening is a process designed to examine transactions in order to detect suspicious or prohibited activity before their approval. If this process confirms fraudulent or risky behavior, the transactions are flagged. This step in the transaction screening process is crucial for filtering out illicit attempts to avoid regulations, such as sanctions. In a broader sense, transaction screening validates transaction details to prevent financial crime, such as:  Corruption Fraud Terrorist financing Weapons proliferation Money laundering Sanction evasion Transaction screening is also a crucial part of a company’s fraud risk management within the customer due diligence (CDD) framework, which should: Occur before the transaction approval. Offer clear risk insights, including both internal and external data.   Use updated sanctions lists to identify sanctioned entities, locations, and activities. This process scrutinizes transaction information in order to identify risks in payments before they're authorized and executed. Financial institutions and other regulated entities should implement transaction screening to comply with local and global AML/CTF regulations. Related: What is the Difference Between CDD and EDD? What Makes Transaction Screening Effective? An effective transaction screening process should use both internal and third-party risk insights. At the same time, a robust transaction screening means that the company is capable of recognizing crucial AML red flags for risks that would help identify and prevent suspicious activities more easily.   Here’s a short list of the top three factors that make transaction screening solutions effective: Data quality. Effective transaction screening solutions should incorporate the company’s data and third-party risk information. Often, many screening solutions are AI-powered, which means they are better capable of identifying key red flags for potential risks, helping companies comply with regulatory standards.   Simple interface. Proper transaction screening solutions should clearly communicate collected data to analysts, enabling them to analyze alerts and escalate the detected suspicious... --- ### An Overview of the Anti-Money Laundering Act of 2020 (AMLA) > Find out the exact timeline and the key changes that the Anti-Money Laundering Act of 2020 (AMLA) brought to the US AML compliance landscape. - Published: 2024-03-19 - Modified: 2024-08-07 - URL: https://www.idenfy.com/blog/anti-money-laundering-act-of-2020/ - Categories: Blog, Regulations by Country A major milestone in AML compliance occurred with the passing of the Anti-Money Laundering Act of 2020 (AMLA), which perfectly reflects the expansion of US AML laws in recent times. Discover the key changes and their impact on today’s AML landscape. The Anti-Money Laundering Act of 2020 (AMLA) introduces nationwide anti-money laundering (AML) priorities and extends AML regulations to various industries. This makes it challenging for regulated entities to stay ahead of ever-changing regulatory rules, especially due to multiple AMLA provisions, such as the creation of a federal registry for beneficial ownership. Many consider AMLA the most impactful AML legislation passed in decades. It holds crucial implications for compliance professionals and has marked a new era in AML compliance in the United States since 2004. In this article, we discuss the essence of AMLA and dive deeper into its provisions. What is the Anti-Money Laundering Act of 2020? The Anti-Money Laundering Act of 2020 (AMLA) stands as a pivotal piece of legislation in the fight against money laundering, marking one of the most significant enactments of US AML laws in decades. At the same time, AMLA establishes nationwide AML priorities and extends AML regulations to new industries.   Timeline for AMLA June 2021: Publication of national AML/CFT priorities. Assessment and proposed rules regarding FinCEN's no-action letter process. December 2021: Proposed new rules for antiquities dealers. Implemented regulations for incorporating national priorities into AML programs. Deadline for Beneficial Ownership reporting and implementation of FinCEN Corporation registry. Publication of SAR threshold report. Final Rule of the program for SAR sharing with foreign affiliates. Report on Treasury review of BSA regulations and guidance. AMLA was passed by Congress in 2021 as a component of AMLA lies the Corporate Transparency Act (CTA). The CTA, nestled within AMLA, grants the Financial Crimes Enforcement Network (FinCEN) the authority to gather beneficial ownership details and share them with relevant parties, including law enforcement agencies. AMLA also updates the AML framework by introducing new amendments to the Bank Secrecy Act (BSA). Key Provisions of AMLA In brief, AMLA made important changes to AML compliance in these sections: It broadens the BSA's definitions of financial institutions covering businesses from other industries, such as cryptocurrency services. It mandates businesses to disclose their beneficial owners to FinCEN. It modifies the process for submitting non-complex suspicious activity reports (SARs). It supplements existing whistleblower protections. It forbids the misrepresentation or concealment of certain information from financial institutions and enhances penalties for BSA violations. It grants the Departments of Justice and Treasury expanded subpoena powers for foreign bank records. It establishes new important priorities in AML/CFT compliance on a national level. We look into each section in more detail below.   Expands AML Regulations Across New Sectors AMLA expands BSA to regulate businesses involved in non-traditional exchanges of value, expanding the definition of “financial institutions. ” This includes virtual currencies, cryptocurrency exchanges, and other businesses offering currency-substituting services, as well as art dealers or businesses selling antiquities. That means AMLA specifies that the exchange or transmission of products acting as a substitute for money, like cryptocurrencies and art, must adhere to BSA registration and AML compliance standards. Additionally, the act allows financial institutions to share data on AML and BSA regulations with their international subsidiaries,... --- ### Case Study: Payset > Learn how Payset switched to a fully automated KYC flow tailored to the fintech sector, achieving 82% reduction in user onboarding time. - Published: 2024-03-18 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/payset-idenfy-study/ - Categories: Use Cases Find out how Payset integrated iDenfy’s AI-powered identity verification solution and transitioned from a manual KYC process to a fully automated onboarding system, tailoring user interface with their brand. The Challenges For Payset, identity verification is an important process that ensures there is a real person behind an interaction and proves that they are who they claim to be. According to Payset, it’s also a pivotal aspect of keeping the company free from fraud and preventing nefarious individuals from using its services to launder money or conceal the true nature of their activities. Since Payset is an EMI regulated in the UK and specializes in diverse solutions, such as multi-currency accounts and currency exchange services, the company needed a reliable Know Your Customer (KYC) vendor that could transform its mostly manual authentication process into a seamless, fully automated identity verification flow for a frictionless user experience. “We looked for an automated verification that could help us effectively verify the identities of our customers,” explained Perry Asforis, the CEO of Payset. “With our growing customer base, manual data entry wasn’t an option anymore since we noticed errors in the process, which also made it more cumbersome for the end user. ” Before adopting iDenfy, Payset relied on a mostly manual approach to authenticating client identities. However, this type of system proved costly due to its lack of efficiency and automation. The absence of streamlined identity verification systems not only incurred higher operational expenses for Payset but also led to slower verification times, which didn’t appeal to another vital aspect — user experience. Payset’s internal compliance team found themselves dedicating excessive time to oversee various aspects of the KYC process. It affected productivity within the onboarding process, increasing the time taken to approve new customer accounts. “Having manual verification processes is a laborious task and not scalable for a business like ours, where time is critical, and customer service is our top priority. So, we needed to streamline our KYC approval process while providing stronger security and an improved user experience,” added Perry Asforis. The Solution Payset’s goal is to bring financial services up to speed with modern business by eliminating the expenses, delays, and red tape associated with moving money between currencies or across borders. This is why the company used the same approach for tasking its KYC service provider.   Seeking a versatile solution, Payset looked for a comprehensive option to address current and future verification needs, a crucial consideration during its scaling stage. “We’ve seen a great increase in our client base, specifically fast-moving startups and ambitious entrepreneurs. We aim to keep reaching new businesses while always providing them with the best payment service possible,” said Perry Asforis, the CEO of Payset. Currently, Payset is using several key features from iDenfy, including: Document verification with automated document data extraction. Selfie verification backed by built-in liveness technology. Address verification through IP address and location data collection. After finding out that iDenfy provides a diverse range of ID verification options and enables the customization of flows based on users' specific use cases, Payset recognized its true potential for its platform. “We like that iDenfy offered white-labeling options. So we customized... --- ### Know Your Employee (KYE) Explained > Discover what it takes to build a compliant Know Your Employee (KYC) process and overcome issues like employee fraud or money laundering. - Published: 2024-03-15 - Modified: 2025-03-10 - URL: https://www.idenfy.com/blog/know-your-employee/ - Categories: Blog You should know your customers, but what about your employees? We dive into the process of Know Your Employee (KYE), pinpointing the key challenges of identifying individuals and specific background checks that are vital before the hiring and onboarding stage. Building a trusted, motivating work environment isn’t an easy task. For managers, that means finding the right people who can contribute to the success of the whole organization. Questions regarding an employee's potential contributions to the organization, optimal departmental fit, and strengths are crucial factors. But this isn’t enough to actually assess your employees.   Assessing whether an employee poses any potential threat to the company is essential. That’s why a robust Know Your Employee (KYE) process is a huge part of the company’s corporate security system. It involves verifying the identity and background of potential employees through different KYE measures, which we’re going to discuss in more detail.   What is Know Your Employee (KYE)? Know Your Employee (KYE) is a process designed for businesses to verify the identities and backgrounds of current staff and potential hires. It involves the procedures a company employs during hiring, onboarding, and throughout an employee's tenure to verify their identity and ensure accuracy in their claims.   A proper KYE process includes: Acquiring accurate employee information Verifying documents and credentials Conducting background checks Updating employee records Communicating with employees Implementing additional security measures KYE’s goal is to confirm the authenticity of employees and mitigate risks associated with past criminal activities. This process also helps to ensure the person’s suitability for their role within the organization. While KYE is a legal requirement for regulated entities, such as financial institutions, its advantages extend to other industries.   For example, KYE can help the company build better relationships with its staff. This includes aligning different roles with precise personal strengths and creating an overall comfortable work environment in order to boost employee satisfaction while minimizing the risk of misconduct. Know Your Employee is similar to other security protocols, such as Know Your Customer (KYC) or Know Your Business (KYB), which are both vital steps in the company’s Anti-Money Laundering (AML) program and efforts to prevent fraud or financial crime. When is KYE Used? Companies use the KYE measures during the hiring process to verify employee identities, qualifications, and backgrounds, including personal information. However, this isn’t the only scenario where Know Your Employee might be beneficial for a company.   Use cases of when KYE is implemented include: At the time of conducting audits and collecting documentation. Record-keeping is essential for the company to manage data collected from the KYE checks properly. By systematically recording these processes, organizations demonstrate their commitment to KYE compliance, ensuring their preparation for internal and external audits.   During the employee’s first onboarding stage. Companies use KYE to detect discrepancies between the information provided by the employee during their onboarding and the data they submitted during their KYC check, which is vital for both compliance and ensuring trust in the organization. The company can decide how it wants to conduct the initial ID verification check, as it all depends on the operating industry and risk tolerance.   As part of the company’s continuous fraud detection system. KYE processes should be part of... --- ### AML for Neobanks: Compliance Challenges and Solutions > We list some of the most popular neobanks, explain what AML for neobanks means - or differs from the traditional banking sector. - Published: 2024-02-29 - Modified: 2024-10-01 - URL: https://www.idenfy.com/blog/aml-for-neobanks/ - Categories: Blog, KYB/AML Find out which qualities make up a neobank, how this new form of a bank differs from traditional financial institutions, if neobanks are obliged to stay in line with the same AML requirements and learn how they overcome their compliance challenges. For quite some time, neobanks have been building a bridge between traditional banks and putting a twist on it — making it better, more efficient and even more customer-friendly. Unlike traditional banks, neobanks don't have physical branches. So, with their innovative digital solutions and customer-first approach, they have disrupted the traditional banking scenery.   The total amount of transactions in neobanking is predicted to grow by 13. 15% every year from 2024. According to Statista’s research, this means it's expected to reach a total of $10. 44 trillion by 2028. However, despite the great success that neobanking brought to the financial sector, the issue of staying compliant with anti-money laundering (AML) regulations remains.   Neobanks must meet AML compliance requirements and implement Know Your Customer (KYC) measures as part of the customer account opening process. AML compliance is one of the key elements paving the way for neobanking's success, necessitating innovative solutions and robust software to detect and prevent financial crimes.   Despite that, neobanks face regulatory challenges because unified AML frameworks are primarily designed for traditional banks. The digital evolution of companies, including neobanks, has led to a struggle for both these entities and regulators to establish effective regulations that address the unique aspects of digital onboarding and overall digital, only-remote services.   We explore these issues and provide solutions for neobanks to implement AML compliance measures more effectively. What is Anti-Money Laundering (AML)? AML, or anti-money laundering, involves regulations, laws, and procedures designed to identify and prevent criminals from masking illegal funds as legitimate income. These policies aid banks and financial institutions in the fight against financial crimes.   For example, in the USA, the necessity for regulated entities to implement an AML compliance program, as described in the Bank Secrecy Act (BSA). This Act outlines requirements for AML compliance programs, mandating that financial institutions establish policies and procedures to detect suspicious activity. They are also required to notify the government by submitting Suspicious Activity Reports (SARs).   However, it’s not just traditional banks that must have a robust AML compliance program. These sets of measures are crucial for various businesses, including traditional financial institutions and entities like neobanks, money services businesses (MSBs), or insurance firms.   The Five Key Pillars of AML Compliance The BSA’s latest version outlines five essential AML compliance pillars that are guidelines for companies to implement into their AML program.   The AML pillars mandate companies to follow these steps: Designating a compliance officer. Conducting thorough risk assessments. Developing AML procedures and policies. Continuously monitor and upkeep the AML program. Enforce Customer Due Diligence (CDD) measures and follow a risk-based approach. In practice, this isn’t a one-and-done deal because it takes more than five steps for companies to stay compliant with AML. For example, a robust AML program should enable the company to gather up-to-date customer information, monitor their transactions, as well as screen for suspicious activity, and report suspicious incidents to regulatory authorities.   Which Companies are Considered Neobanks? Neobanks are considered... --- ### Anti-Money Laundering (AML) Software: Explanation, Features & More > Learn how to identify effective AML software, its main features, how to build custom rules through automation, and more on staying compliant. - Published: 2024-02-29 - Modified: 2024-10-01 - URL: https://www.idenfy.com/blog/anti-money-laundering-aml-software/ - Categories: Blog, KYB/AML Explore the world of anti-money laundering (AML) compliance, access insights on selecting the right AML software, identify what crucial features AML automation should have, and understand what AML procedures AI-powered solutions can actually automate. It’s clear that the world has a money laundering issue. And despite regulators’ efforts to prevent financial crime, this task remains challenging. Especially because a significant portion of money laundering activities remains concealed. This complexity comes not only from the ongoing efforts of law enforcement but a combination of many factors, including geographical influences or socio-economic factors, such as less-regulated regimes or the rise of extensive criminal networks.   Recent data indicates that in the UK, money laundering stands out as the most common Anti-Money Laundering (AML) event, with AML compliance failures following closely behind. The process of money laundering, known as "washing," consists of moving money through various financial institutions via transfers until it appears legitimate. This nefarious practice that has extended beyond national borders in many countries remains a problem for the global economy. It’s also a serious hassle on a more local level and a headache for many regulated businesses.   In this context, AML rules play a crucial role. More importantly, automated tools, such as AML software turn compliance into a smooth, more efficient ongoing process that ticks all the right boxes, including helping companies detect and report suspicious activity in terms of safeguarding from predicate offenses like money laundering and terrorist financing.   What Does AML Mean? AML, short for Anti-Money Laundering, is a globally recognized term that represents efforts to combat and prevent financial crimes associated with illicit money activities. It consists of actions undertaken by financial institutions and other obliged entities to comply with legal requirements, involving the proactive monitoring and reporting of suspicious activities. AML rules, together with Combating the Financing of Terrorism (CFT) policies, are vital measures that address crimes like terrorist financing, human trafficking, drug dealing, fraud, and other illicit activities. AML regulations integrate the scrutiny of money laundering (the source of funds) and terrorism financing (the destination of funds). Countries and international bodies, like the European Union (EU), mandate strict AML programs for relevant companies in sectors like fintech, banking, payment processors, insurance, gambling, crypto, real estate, and more.   The FATF and its Role in AML Compliance Financial sector regulators worldwide adhere to the guidelines of the Financial Action Task Force (FATF) to combat money laundering. The FATF is a global regulatory body guiding companies in addressing money laundering and terrorism financing.   Through its 40 Recommendations, it expects member jurisdictions to adopt a unified AML/CFT approach, enabling regulated entities to establish robust anti-money laundering programs and contribute to the fight against fraud and financial crime. FATF's 40 recommendations guide companies to maintain robust AML practices by following these steps: Identify financial crime. Recognize various types of financial crime threats within a country's existing policies and systems. Implement anti-fraud policies. Develop and enforce policies and procedures in the country's financial infrastructure to counter identified threats like money laundering, terrorist financing, drug trafficking, and weapon trading. Build a proper AML program. Establish preventive measures for financial institutions and reporting entities aligned with FATF's AML and CFT recommendations. These measures... --- ### KYB vs KYC — What is the Difference? [Explanation Guide] > Find out all details regarding KYB vs KYC and learn how to implement each process to make your business AML-compliant. - Published: 2024-02-28 - Modified: 2025-03-26 - URL: https://www.idenfy.com/blog/kyb-vs-kyc-difference/ - Categories: Blog, KYB/AML KYB and KYC checks are vital for AML compliance, ensuring safety through verifying identities, reporting suspicious activities, and maintaining detailed financial records. Discover the distinctions between both processes and learn the essential steps helping businesses prevent financial crime. Financial institutions and regulated organizations must establish Know Your Customer (KYC) programs to verify user identities. However, conducting checks and due diligence on both new and existing customers, including businesses, is crucial as well. This is where specific regulations like Know Your Business (KYB) address the business customer aspect. KYB and KYC checks are somewhat similar. They involve verifying companies and the individuals associated with them. KYB/KYC processes are essential due to regulatory requirements, fraud prevention, and overall trust and safety in any business. In general, Anti-Money Laundering (AML) regulations require businesses, both financial and non-financial, to actively monitor and safeguard against potential fraud and other financial crimes. While financial companies must conduct KYB and KYC checks, non-regulated entities should also consider specific use cases where verifying their business partners or new individual clients can be beneficial. Obviously, both processes are vital for upholding the integrity of the financial system and mitigating risks related to money laundering and terrorist financing. But what else is there? We deeply dive into the topic of KYB vs KYC and explain the differences, benefits of each process, and regulatory requirements.   What are KYB and KYC Checks? KYB and KYC checks are key components of a company’s Customer Due Diligence (CDD) process. These checks often consist of verifying a company's registration documents, ownership structure, and beneficial owners to ensure compliance and mitigate the risk of fraudulent activities.   Both KYB and KYC are critical in preventing financial crimes and maintaining regulatory compliance. The extent of ongoing monitoring during the business relationship is determined by the risk level identified in KYB and KYC checks. They aid in comprehending the individuals associated with the organization and contribute to the prevention of money laundering activities. What is KYB (Know Your Business)? KYB, or Know Your Business, is a process designed to verify customer identities and assess the risk associated with a business relationship. While the principle is similar to the KYC process, KYB is used when companies interact with other businesses that they’re dealing with, for example, service providers or customers.   KYB also extends to confirming the identities of the individuals associated with the companies that are being screened during KYB checks. During the process, companies gather and verify information, such as government reports, tax records, or financial statements, to assess the legitimacy of businesses seeking their services.   Effective KYB checks help companies answer three key questions: Who are the ultimate beneficial owners of the business? Beyond verifying legitimacy, KYB helps companies analyze the ownership structure, including directors and ultimate beneficial owners (UBOs), providing insights into potential links to illegal activities or the involvement of criminals that hide under anonymous parties.   Is the business legitimate and trustworthy? KYB helps assess if an entity is a genuine organization or, for example, a front for illicit activities, such as a shell company used for money laundering.   Are these individuals authentic in their identity, and can they be considered safe for business dealings? KYB checks also... --- ### Top 5 KYC Challenges and How You Can Overcome Them [In-Depth Explanation] > Find out what KYC challenges business face and how you can solve them in practice through industry examples and ID verification tips. - Published: 2024-02-23 - Modified: 2025-05-08 - URL: https://www.idenfy.com/blog/kyc-challenges/ - Categories: Blog, Identity Verification Learn the key reasons why companies struggle with KYC challenges. Find out how to build a proper identity verification process while keeping up with the regulatory compliance requirements and increasing customer demands — all while exploring real-life use case examples from various industries. Lengthy onboarding process, unexpectedly increasing costs from your identity verification vendor, or challenges with data keeping and reporting are just a tiny piece of the puzzle when it comes to ensuring a smooth and compliant Know Your Customer (KYC) process. That’s why many companies in different industries face KYC challenges, wasting precious time and resources on the wrong vendors that can’t customize identity verification flows to specific use cases.   So, above this glimpse into some of these issues, we look into the top five KYC challenges and explore them from a more detailed point of view so you don’t have to make the same mistakes in your KYC onboarding process.   1. Too Many Fraudulent Accounts are Trying to Access Your Network In the banking sector as well as in the context of other regulated entities, fraud management is very important. It involves implementing controls to prevent criminal activities, such as preventing fraudulent accounts with fake identity documents or users who don’t want to pay for services, which result in a high chargeback rate. And this happens more often than you think. For example, financial institutions deal with a high cost for fraud, with a ratio of $4 in expenses for every $1 lost. So, it’s only natural that detecting various types of fraud poses different challenges. As illegal schemes become more complex, companies are pushed to enhance their investments in fraud risk management and other RegTech tools. That’s because standard Know Your Customer (KYC) solutions can struggle with more sophisticated fraud.   One of the key examples in this sense is deepfakes or synthetic identities, where criminals merge stolen and real data to create “Frankenstein” personas. That’s why the rapid advancement of AI technology has brought about growing concerns regarding its potential misuse. For example, Google has temporarily paused Gemini's capability to generate images of people as they work on refining the model. 🟢 Solution: Find a Provider That Tests its Software Against Fraudulent Accounts Fraud specialists should know how to analyze data to identify patterns and emerging trends, such as various samples of deepfakes or synthetic identities. Companies should apply a similar approach when assessing ID verification and fraud prevention solutions. The government-issued ID document verification technology should not only determine whether the document is genuine or not, but it also should be able to evolve and adapt to new types of emerging fraud tactics.   This typically is achieved for a company if it tests multiple document samples and onboarding data from its internal databases. This approach is powered by both manual and AI models that can detect diverse fraud patterns.   However, training AI exclusively on genuine document samples may not effectively recognize all fraudulent attempts to pass the verification process, for example, especially when there are multiple sophisticated synthetic identity cases used globally every day. By using this diverse technique, companies can find a better balance in training datasets and ultimately enhancing products for their customers.   Other Fraud Risk Controls for Detection and... --- ### Transaction Monitoring Software in Fintech: How to Set it Up? > Learn how to set up transaction monitoring in fintech, specifically adapting to AML compliance requirements and industry specifics. - Published: 2024-02-21 - Modified: 2025-04-08 - URL: https://www.idenfy.com/blog/transaction-monitoring-software-in-fintech/ - Categories: Blog One of the most important parts of the Anti-Money Laundering (AML) compliance package is transaction monitoring — a thorough practice of tracking customer transactions. However, how does it actually work in the context of fintech, and how can businesses improve this process? We explain it all in this blog post. Transfers, deposits, withdrawals, or any other customer transactions can be used to launder illicit funds. And the worst part is that illicit funds can be used pretty much anywhere - from gambling platforms to payments for a mortgage. For this reason, all financial institutions and financial service providers, including fintech companies, are obliged to monitor customer transactions to detect financial crimes.   Transaction monitoring not only serves as one of the key tools to identify suspicious activity but also analyzes current and historical customer data, giving companies a better look into their customers and their risk profiles.   Despite that, this process is more complex than many assume, especially in today’s geopolitical landscape, where obliged entities must deal with different sanctioned regimes, making sure they do not run a green light on transfers from sanctioned regions, for example. This is also a part of transaction monitoring.   Keep reading to find out more about transaction monitoring and AML compliance requirements for the fintech industry. What is Transaction Monitoring in the Context of Fintech? Transaction monitoring is a practice that is designed to track and screen customer transactions, for example, deposits, transfers, or withdrawals, for fintech companies to detect potential illegal activity, such as money laundering or terrorist financing.   This process aims to closely monitor customer transactions in order to identify and prevent potential instances of money laundering or other financial crimes. Transaction monitoring is also part of AML compliance obligations that are set by regulatory authorities. These rules are standard practices that fintech companies and other financial institutions must follow and implement to stay compliant.   During transaction monitoring, suspicious transactions are flagged. Fintech companies then need to follow further investigations to determine their legitimacy. This is why ongoing transaction monitoring is vital in order to identify potential issues and prevent unwitting involvement in money laundering at any stage of the business relationship with the customer.   The History of the Transaction Monitoring Process The origins of monitoring transactions for potential money laundering activities go back to the 1980s. This was a time when people started to focus more on combating financial crime through standardized, established measures that were specifically designed to prevent the illicit use of the financial system.   However, fast-forward to the 2000s, the sophistication of transaction monitoring reached a whole new level, considering the increasing use of machine learning and artificial intelligence (AI). These new technologies helped fintech companies and other money services businesses (MSBs) to handle large datasets and identify suspicious transactions.   Today, the fintech industry sees transaction monitoring as the primary component for ensuring compliance with AML rules, which require fintech to: Scrutinize transactions in order to detect and report suspicious activities to relevant authorities. Implement a proper transaction monitoring process, often through automated AML software, in order to meet regulatory requirements. Typically, even though many fintech companies use some sort of RegTech software for transaction monitoring, the human touch is inevitable. Automatically flagged transactions are often checked manually by internal compliance... --- ### AML Red Flags — Complete Breakdown > Find a complete in-depth summary of the key AML red flags — warning signs of crime — according to the latest FATF recommendations. - Published: 2024-02-14 - Modified: 2025-05-16 - URL: https://www.idenfy.com/blog/aml-red-flags/ - Categories: Blog Did you know that the Financial Action Task Force (FATF) was created in 1989? Since then, they have set grounds for a more stable action plan against money laundering and terrorist financing. However, the level of complexity in financial crime is rising, and companies must be vigilant when it comes to different risks — or, as we call them — AML red flags. As illicit schemes become increasingly difficult to trace and malicious actors grow more sophisticated, compliance teams are consistently vigilant for signs of financial crime. To meet Anti-Money Laundering (AML) compliance requirements and enhance their overall AML strategies, regulated businesses implement systematic approaches to identify these risks. AML red flags serve as indicators to identify when an individual or business is more prone to engaging in money laundering or other fraudulent activities.   So, what can you do to protect your business and customers from the harmful effects of money laundering? This article outlines key AML red flags, offering an effective strategy to identify risks and prevent undesirable consequences associated with crimes like money laundering. What is a Red Flag in AML? In the context of AML compliance, a red flag, such as an unusually large transaction or a company from a sanctioned jurisdiction, is a warning sign that indicates potential criminal activity, such as money laundering. The key goal of an AML red flag is to signal both companies and law enforcement agencies to potentially suspicious transactions associated with money laundering. Effectively identifying red flags is crucial for an effective AML program, requiring regulated businesses to build a clear process for the identification and investigation of flagged issues. However, a red flag doesn’t automatically brand the customer or the company as a fraudulent entity. Often, regulated businesses must submit Suspicious Activity Reports (SARs) to authorities after detecting red flags among their clients. Key Red Flag Categories The FATF, as it describes itself as the global money laundering and terrorist financing watchdog, has provided a list of flags linked to the virtual asset service providers (VASPs) and their risks, as well as other financial institutions.   In the report, the FATF offers valuable information for financial intelligence units, law enforcement agencies, prosecutors, and regulators to analyze suspicious transaction reports and monitor compliance with AML/CTF laws.   In total, the FATF lists 42 red fags, which can be categorized into four key groups: Red flags related to the client. For example, they are overly secretive about where the money comes from, their identity, why they’re doing the transaction this way, who the beneficial owner is, etc.   Red flags that are linked to the source of funds. For instance, the customer uses multiple foreign accounts without a reasonable explanation, or there’s unexplained third-party funding for the transaction or associated fees without a clear connection or legitimate explanation. Red flags in terms of choice of lawyer. For example, the customer chooses guidance from a legal professional lacking expertise in a specific specialty, or they change advisors a number of times within a short timeframe or without a legitimate reason. Red flags in the nature of the retainer. For instance, the client engages in transactions that are atypical based on their business activities, or the operation being notarized is noticeably inconsistent with the size, age, or activity of the individual or legal entity involved. Related: 40 Recommendations of the FATF — Overview General FATF... --- ### Address Verification Explained > Learn what address verification is, its types, PoA documents, the best address verification flow options and challenges business face today. - Published: 2024-02-07 - Modified: 2025-04-15 - URL: https://www.idenfy.com/blog/address-verification-explained/ - Categories: Blog Access the most recent information on address verification, including use case examples, and learn the key methods for confirming whether the provided address data aligns with the information provided by another individual or business. Enhancing customer service and combating fraud often involves collecting and verifying various information about the person, including their address. That’s why a proper address verification process is crucial for businesses to prevent the approval of new accounts with false addresses.   One of the primary challenges companies face is the rapid pace at which transactions occur. Not only that but also the use of AI and its scalability for fraud, which leaves e-commerce platforms and other online businesses vulnerable to even more types of malicious acts. So, it’s clear that without robust security measures, such as address verification, companies risk their money and, more importantly, the trust of their users. In this blog post, we find out how address verification is vital during customer onboarding. How it helps mitigate further complications, such as users with malicious intent registering on the platform only to engage in fraudulent activities, and much more.   The Definition of Address Verification Address Verification is a security process that helps companies verify the accuracy of users’ address information. For example, e-commerce platforms verify users’ addresses to ensure that their billing address matches the one linked to the cardholder's account. There are different methods to verify one's address. Sometimes, companies build an address verification process that compares a user-submitted address to a standard database that contains geographic and demographic data to verify its authenticity. Furthermore, businesses can use additional identity verification measures to ensure that the individual or business is genuinely located at the provided address. How Does Address Verification Work? Companies often choose to implement AI-powered address verification software. So, for example, instead of asking their customers to visit physical branches, banks build a fully customizable and highly automated verification process. Another popular example is e-commerce platforms that can use this streamlined approach to automatically fill in address form fields, facilitating faster checkouts for customers.   Address verification works when customers upload an image of a document. Then, the document verification step guarantees the authenticity of the document or image, with the verification system extracting the address details through optical character recognition (OCR). Possible Scenarios if the Address Verification Process Fails If a partial match or mismatch is detected in the automated address verification process, companies typically decide on the next steps. A mismatch is a discrepancy or inconsistency that can happen when confirming whether a given address is valid. Afterwards, companies decide how they want to proceed with the verification and whether they want to: Request a new address document. Send the document for manual review. Ask the customer to complete additional ID verification steps. Rejecting the customer's application. For a more accurate address verification process, some companies use additional database checks that can cross-check address information with an authoritative global source. This helps determine within seconds if the address corresponds to an actual physical location without adding unwanted hassle for the end-user.   What Challenges Do Businesses Face Regarding the Address Verification Process? If implemented correctly, address verification ensures the accuracy of addresses in... --- ### What is Ongoing Monitoring? [With Examples] > Ongoing monitoring in AML requires multiple steps and RegTech tools - of course, only if you want to build an efficient and accurate process. - Published: 2024-01-31 - Modified: 2024-09-26 - URL: https://www.idenfy.com/blog/what-is-ongoing-monitoring/ - Categories: Blog Dive in to find ongoing monitoring examples, what it takes to stay KYC/AML-compliant, as well as the challenges that arise when trying to build a proper ongoing monitoring process. Ongoing monitoring is a risk management component designed for financial institutions and other companies to systematically screen customers, their transactions, and related activities that would potentially help detect criminal behavior. As regulations undergo constant changes, the consequences of making one wrong move for businesses are major. That’s why companies strive to manage the growing risks of criminal activity. This proactive approach serves businesses the dual purpose of avoiding getting tangled in non-compliance scandals or facing enormous penalties for failing to prevent fraud within their operations. Let’s not forget the infamous Bernie Madoff Ponzi scheme. This fraudulent operation exposed notable lapses in JP Morgan's operations. Madoff's investment scheme claimed to have robust ongoing monitoring procedures, which, if properly scrutinized, could have triggered red flags and raised suspicions. However, the case was treated with a lack of transparency. Suspicious behavior alerts were disregarded, leaving the fundamental aspect of ongoing monitoring out of the picture.   On March 12, 2009, Madoff entered a guilty plea to 11 federal crimes, including confessing to orchestrating the largest private Ponzi scheme in history. That’s why relying on conducting due diligence during onboarding and at periodic intervals is no longer sufficient. Businesses should implement ongoing monitoring to capture changes on time, update customer profiles, and continually assess changing risks. We dive deeper into this process below.   The Definition of Ongoing Monitoring  Ongoing monitoring, also referred to as continuous monitoring, is a vital process in the company’s KYC/AML compliance program. It involves regularly checking and verifying customer information to ensure ongoing compliance with regulatory requirements and to detect any illegal or suspicious activities. As explained in the FATF Recommendations, ongoing monitoring is the process of continuous examination of transactions and customer behavior throughout the entire duration of a business relationship. This process ensures the periodic review of key information, including collecting and verifying customers’ transaction history and other relevant details.   Key facts to remember: Ongoing monitoring helps determine whether specific customers, especially those of higher risk, need additional due diligence measures. This continuous practice ensures that the business and its activities stay current and in line with the customer's risk profile established at the first stage of the onboarding process. Ongoing monitoring is a crucial component within the financial system, ensuring that companies consistently comply with their compliance requirements and prevent illegal activities. What is the Goal of Ongoing Monitoring? The primary goal of ongoing monitoring is to ensure compliance with laws and regulations, such as anti-money laundering (AML) and countering the financing of terrorism (CFT). On top of that, ongoing monitoring involves regularly updating customers Know Your Customer (KYC). This ensures that the information is accurate and up-to-date, which contributes to AML compliance. With ongoing monitoring, companies aim to improve three core business goals: Improve regulatory compliance Boost internal operational agility Increase the level of security and customer satisfaction Financial institutions must regularly update and validate the data, documents, or information gathered during the customer due diligence (CDD) process. Consequently, this collected information is used... --- ### Business Verification Solution in 2024 - Focusing on Automating Compliance Procedures > Business Verification solution in 2024. Focusing on automating compliance procedures with automations for AML, KYC checks. - Published: 2024-01-29 - Modified: 2024-03-21 - URL: https://www.idenfy.com/blog/business-verification-solution-in-2024/ - Categories: Blog, KYB/AML Check hands-on walkthrough on configuring custom rules to streamline your AML compliance processes while onboarding new companies. In this guide, we’ll dive deeper into Know Your Business solution for compliance officers. We’ll start by explaining custom rules and how they help to automate your ongoing compliance processes.   A brief overview of Know Your Business solution Know Your Business is a verification standard that determines the legitimacy of the company and its ownership structure. It acts as a due diligence procedure that reviews business activities to ensure the partnering entities aren’t involved in illicit activities. Manual verification of the companies is time-consuming (compliance officers save up to 30% of their work time after switching to an automated solution) and error-prone. The most common issues are the following:Approval of falsified company documents. Without direct access to government registries or credit bureaus, you can’t guarantee that the uploaded documents: tax statements, incorporation, and source of funds are authentic and legitimate. Incorrect shareholders and UBOs identification. Fraudulent companies might not provide sufficient information about their ownership structure, and without the appropriate software, it is hard to verify the data. Failure to perform enhanced due diligence upon shareholders. Official sanction lists (OFAC, EU Consolidated List, UN Sanctions list, etc. ) are updated frequently. A correct AML procedure must utilize software that provides continuous customer rescreening and ongoing monitoring. Features of automated Business Verification software To automate the business onboarding, the software needs to tick all required boxes during company verification: Shareholders extractions from an official company statement. For that, you can order credit bureau reports from 160 countries. The credit bureau contains the company’s credit score, information about the company’s ownership structure, and other required details. Since credit bureau returns data up to 3 months old, you can also order official government reports with information directly extracted from government sources. Incorporation documents upload and management software for ongoing due diligence. We’ve built custom forms where the compliance team can directly request additional documents or changes in the ownership structure. AML screening. To have a correct compliance procedure, you need to perform sanctions checks for the company and UBOs or shareholders without significant control. More information about correct business verification practices can be found here. KYC verification. Whenever needed, you need to have an option to initiate the KYC session for the company’s beneficiaries directly.   Address verification. To ensure that the company is legitimate, you can perform an address check, which will verify that the company’s address exists and matches the extracted data from the reports. Getting started with custom rules for Business Verification The custom rules are designed for you to specify the desired flow of the compliance process and receive the required information. Each custom rule performs a single action and is used together to archive the desired flow. All your custom rules are available in the dashboard. Here is an example of multiple custom rules, which are then used for specific business verification flows. Example #1. Flag all shareholders if they are sanctioned First, you need to navigate to the custom rules section in the dashboard and create... --- ### What is Reverification? Explanation Guide [2025 Edition] > Reverification is crucial for swift ID document re-checks and selfie reverification with the bonus of minimizing account takeovers. - Published: 2024-01-29 - Modified: 2025-01-06 - URL: https://www.idenfy.com/blog/what-is-reverification/ - Categories: Blog, Identity Verification Find out the key use cases of reverification and learn why this process can be a beneficial factor in both security and user experience. The purpose of the reverification process is to check and confirm the identity of a customer who has previously completed the verification process. A lot of businesses use this measure when customers are involved in a high-risk action after their initial onboarding stage. For example, it can be useful to initiate reverification after the customer changes their personal information, such as their address info or their documents expiring. While many businesses perceive identity verification as a one-time requirement, the reality is that the initial verification is typically just the starting point. That’s why reverification helps businesses maintain up-to-date information about their customers and can detect alterations in their risk profile.   Some industries mandate this process, it serves as a protective measure for both the company and its customers. This ensures compliance with regulatory standards and aids in the proactive management of potential risks associated with customers. However, reverification can also be beneficial for non-regulated entities as an extra security measure against account takeovers and other types of fraud. Let’s find out how exactly that is possible. What is Reverification? Reverification is a process designed to reassess a customer’s information by verifying their identity again after the initial identity verification process. This systematic practice checks the correctness of a customer’s information and risk profile, which is a vital part of ongoing customer due diligence (CDD) and the risk-based approach (RBA) to anti-money laundering (AML) compliance. For example, landlords in the prop-tech industry use reverification, as it allows them to confirm the identity of potential tenants before entering into a business relationship with them. In particular, reverification processes depend on biometric technology. Compared to traditional verification, this procedure is an efficient, simple, and user-friendly process that swiftly confirms the user’s identity. If the reverification fails, the company can proceed with the next appropriate steps, ensuring they don't become entangled with a fraudulent customer. Use Cases for Reverification When it is required to use the reverification process depends on the business, industry specifics, and user expectations, as well as mandatory regulatory requirements. However, re-verifying customers plays a vital role in every digital company’s growth and development for maintaining user trust. Companies often use the reverification process in various use case scenarios, including when: A customer’s document expires. There’s a change in the customer’s personal data. There’s a higher risk of money laundering and other financial crimes. Suspicious activity, such as a fraudulent IP address, is detected. A customer’s data was compromised, for example, due to an account takeover. A customer hasn’t logged into their account for a long period of time. If the business must comply with AML or Know Your Customer (KYC) regulations that require integrating identity verification, they may be required to reverify existing users in the event of changes to regulatory compliance requirements. On top of that, the reverification process enables regulated entities to update high-risk customers subjected to Enhanced Due Diligence (EDD). This helps conduct an accurate assessment of potential risks associated with the customer's activities. Why is... --- ### Top 3 KYC Automation Benefits for Businesses > In the world of large data volumes, fast scaling efforts, compliance regulations and sophisticated fraudsters, KYC automation is the answer. - Published: 2024-01-28 - Modified: 2024-07-11 - URL: https://www.idenfy.com/blog/kyc-automation-benefits/ - Categories: Blog, Identity Verification We explore the concept of KYC automation and its use cases, explaining how AI-powered KYC software can improve internal compliance operations for businesses. All financial institutions and other regulated businesses need to comply with Know Your Customer (KYC) requirements. Failure to meet these standards in a regulated industry can result in fines or criminal prosecution. This puts a huge burden on companies that must ensure compliance and also want to implement an efficient, cost-effective identity verification process.   At a minimum, a robust KYC process requires companies to gather personal data, including the customer’s name, address, date of birth, and identification number. Given this, manual KYC approaches don’t stand a chance compared to the efficiency of automated software and its capabilities. So, it’s clear that KYC automation is the answer if you want to streamline identity verification checks. If your business operates internationally or intends to expand, you should be ready to adapt to evolving compliance standards, eliminating the necessity for constant re-engineering when entering new markets. Effective KYC automation solutions should be customized to align with your business.   That’s why only AI-powered software can ensure compliance with KYC requirements without complicating the customer experience or adding friction to the onboarding processes. What is KYC? KYC stands for Know Your Customer, also sometimes referred to as Know Your Client. It’s a standard process used in various industries, such as financial services, to confirm the identity of new customers. The primary goal of KYC is for businesses to check whether the customer trying to access their services is legitimate and not a fraud.   Typically, the KYC process, at a minimum, involves collecting and verifying personal information, such as their name, address, date of birth, and government-issued identification. The goal of the KYC process is to prevent money laundering, terrorism financing and other financial crimes, this way, stopping business relationships with individuals linked to crime.   It's important to note that while Anti-Money Laundering (AML) is closely tied to KYC onboarding, automated AML solutions focus more on monitoring the activities of KYC-verified individuals during transactions to prevent the occurrence of money laundering further. Related: KYC and AML Compliance: Key Differences and Best Practices What is KYC Automation? The term KYC automation refers to automated software that is used to streamline the identity verification process and handle the collection of personal information. It often involves other aspects, like document review procedures. Many regulated industries today use at least some sort of automation to maintain compliant and efficient internal KYC processes that do not completely rely on manual oversight. By using advanced technology, KYC automation is the reason why modern ID verification processes are more efficient and cost-effective, reducing the time and resources needed for compliance.   Automation can cover the whole KYC process, starting from identity verification and risk assessment and ending in ongoing monitoring, which can be split into three key KYC steps: Customer Identification Program (CIP). Verifying customer identities and confirming them through government-issued IDs. Risk-Based Approach (RBA). Determining the risk associated with the customer’s identity. Ongoing Monitoring. Maintaining ongoing due diligence through accurate, up-to-date customer profiles. Several KYC automation solutions exist... --- ### What is a Politically Exposed Person (PEP)? > PEP and KYC/AML rules constantly evolve, obliging companies to conduct screening on high-risk groups, including politically exposed persons. - Published: 2024-01-28 - Modified: 2025-02-26 - URL: https://www.idenfy.com/blog/politically-exposed-person-pep/ - Categories: Blog The verification of a Politically Exposed Person, or a PEP, is a mandatory requirement in regards to Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations. PEPs hold greater power due to their position of influence, which makes them more susceptible to fraud, including money laundering. This makes them higher-risk customers that need to be treated with an appropriate level of due diligence. Read more. A Politically Exposed Person poses a higher risk regarding potential involvement in crime. That puts PEPs, due to their prominent position or influence, at a higher risk of being involved in various criminal activities, such as money laundering, terrorist financing, bribery, or corruption.   Companies stay in line with financial crime compliance requirements by implementing proper processes for PEP identification and verification and further Enhanced Due Diligence (EDD) procedures. However, while extra caution is necessary for financial institutions that are dealing with PEPs, it’s important to understand that being classified as PEP does not automatically make the person a criminal.   Over time, financial institutions have been dealing with numerous PEP status changes, which influenced how governments and financial institutions treat it. For example, the PEP status applies not only to the individuals themselves but also to their family members and close business associates. Keep reading to find out more about PEPs, compliance, and related challenges that businesses face.   The Definition of a Politically Exposed Person (PEP) A Politically Exposed Person (PEP) is an individual with an elevated status who is more vulnerable to engaging in activities such as bribery, money laundering, or corruption. Often, PEPs hold significant public roles within an international organization or a government. Financial institutions consider PEPs to pose a higher risk because they have higher chances of participating in financial crimes, such as money laundering. Identifying and labeling a customer as a politically exposed person doesn't automatically ban a company from engaging with them. The PEP check is a single element in a more complex AML process that enables financial institutions to conduct a proper risk assessment. What is the Importance of PEPs in the Context of KYC/AML Compliance? In the context of Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance, politically exposed persons are very important because they pose an elevated risk of financial crime. According to the United Nations Office on Drugs and Crime (UNODC), an estimated 2-5% of the GDP is laundered annually. This means that at least €715 billion and up to 1. 87 trillion are laundered every year. The Anti-Money Laundering Law defines PEPs as natural persons who hold or have held prominent public functions. Financial institutions and other entities dealing with PEPs must implement heightened due diligence measures to manage these risks and avoid involvement with individuals linked to crime. In practice, that means identifying PEP status and conducting ongoing due diligence. This step can include obtaining more details about the origin of the customer's wealth and conducting periodic reviews of the account to ensure its legitimate use, as well as monitoring transactions for indications of money laundering or other illicit activities. Related: AML/KYC Guidelines for Fintech Companies Politically Exposed Person (PEP) Regulations To prevent the misuse of the financial system, non-financial businesses and financial institutions must implement AML measures to establish PEP verification processes. In simple words, companies must integrate AML screening mechanisms into their AML programs.   This obligation is incorporated into the AML legislation... --- ### Chargeback Fraud Prevention: Key Strategies for Businesses > How bad are chargebacks for businesses and how to actually minimize chargeback fraud costs + more practical chargeback fraud prevention tips. - Published: 2024-01-28 - Modified: 2024-07-15 - URL: https://www.idenfy.com/blog/chargeback-fraud-prevention/ - Categories: Blog Learn how to build a robust chargeback fraud prevention strategy and mitigate increasing crime risks. Find useful tips for businesses on how to minimize losses and ensure they’re kept at the bare minimum of expected chargeback costs. Reducing fraudulent chargebacks can be a lengthy and exhausting process. While international chargeback fraud is illegal, it seems that chargebacks are reaching sky-high numbers, and in some cases, traditional anti-fraud measures don’t help companies prevent such major losses.   The volume of chargebacks can leave companies uncertain about whether they'll face minimal chargeback losses or lose millions in the following year. Not only that but also the scope of growing fraudulent activities online makes it harder for businesses to safeguard their assets.   Ponemon Institute’s recent report reveals that 61% of respondents acknowledge their companies lack the appropriate technologies to combat online fraud. On top of that, only less than half of the respondents indicate that their organizations actually have the in-house expertise to prevent online fraud, such as chargebacks.   So, the first step to minimize costs linked to chargebacks is for businesses to actually understand what this phenomenon is, how it works, and what the key practices are to respond when the risks are identified.   In this blog post, we go around five talking points:  What are chargebacks exactly, and how do they happen What is the difference between a chargeback and chargeback fraud Is it possible to prevent chargebacks, and if so, how What key reasons make chargebacks so expensive for businesses How to reduce chargeback fraud costs for businesses What is a Chargeback? A chargeback is a process that happens when a cardholder initiates transaction reversal, also known as a dispute, in order to receive a refund from their bank or the credit card company. While the process itself generally protects customers from fraud, dishonest individuals can exploit the system on purpose. Customers often initiate chargebacks because of dissatisfaction with a product or service or errors made by the business. In practice, customers often use chargebacks simply to avoid returning disliked items or for orders that never arrived. However, chargebacks can happen when a cardholder files a chargeback for a legitimate purchase they made.   Why do Chargebacks Happen? Chargebacks serve the purpose of addressing credit card fraud and errors like: There was an accidental double charge A subscription needs to be canceled An incorrect amount was charged There were damaged or missing goods The item arrived not as described The goods took too long to arrive Stolen cardholder data was used Originally, chargebacks first aimed to remedy credit card fraud, boosting consumer confidence in credit cards. This concept was designed almost half a decade ago to create a system for basic consumer protection. In practice, today, such disputes are easily accessed tools for buyers who simply don’t want to go over the hassle of returning their received items and would much rather receive a refund instead. What hurts businesses most is that with chargebacks, customers reclaim funds directly from their bank or card company, bypassing the merchant entirely. So, unlike refunds, chargebacks can be more harmful to merchants, given the costs and the possibility of negatively affected reputation or regulatory compliance. What is Chargeback... --- ### KYC in Banking Explained > KYC, or Know Your Customer (KYC) in banking has its challenges, especially when it comes to the right level of due diligence and automation. - Published: 2024-01-28 - Modified: 2024-12-13 - URL: https://www.idenfy.com/blog/kyc-in-banking/ - Categories: Blog Know Your Customer or KYC in banking refers to the series of identity verification checks designed to verify customers. The KYC process helps banks and other financial institutions confirm that the person is who they say they are when registering on their online platform and opening a new account. But KYC doesn’t stop at the onboarding stage of the customer’s relationship. Read more. KYC is a crucial element in the fight against financial crime and money laundering. This makes identity verification the first line of defense in better assessing customer risk levels. So, even though the series of KYC checks helps banks identify them at the start of their relationship, KYC obligations continue throughout the whole customer journey.   KYC procedures are not only a security measure but also a legal requirement for banks to comply with anti-money laundering (AML) and counter-terrorist financing (CTF) laws. Regulators and governments set out these preventative measures as a way to provide a standardized framework for banks all over the world. At the most basic level, a robust KYC process in banking must follow three essential elements: Establish the customer's identity. Gain insight into their background and transactional activity, ensuring the legitimacy of their behavior. Continuously assess the customer’s money laundering risks through ongoing monitoring. In this blog post, we gain a deeper understanding of identity verification and what it takes to build an effective and compliant KYC program, particularly focusing on banking industry specifics. The Definition of the KYC Process in Banking The KYC process in banking refers to Know Your Customer, also known as Know Your Client, a mandatory requirement for financial institutions to identify and verify a client’s identity. Banks conduct KYC checks during the account opening process and periodically over time. If the client fails to complete the KYC process, for example, if they provide an altered document or their biometric information doesn’t match the photo on their identity document, the financial institution must refuse to open their account or start the business relationship. KYC in banking can be applied to both individual users and businesses. For companies, the verification process is known as Know Your Business (KYB) or corporate KYC. Why is KYC in Banking Important? Financial institutions are legally obligated to know their customers and identify their business counterparts. Not only banks but other entities such as fintech businesses or cryptocurrency exchanges are required to follow KYC/AML laws, for example, as outlined in the Bank Secrecy Act (BSA).   If a financial institution fails to verify a customer's identity and that customer engages in financial crimes such as money laundering or terrorist financing, the institution can face: Major financial losses Damage to its reputation  Sanctions For example, back in 2017, Danske Bank received a fine of $425 million for its failure to uphold proper AML measures. Similarly, in 2023, Deutsche Bank faced a penalty of $186 million for also not adequately addressing issues related to AML controls and other deficiencies. To avoid this, banks must comply with KYC requirements and provide law enforcement authorities with the necessary information to prevent and address criminal behavior. KYC processes for financial institutions aren’t an easy task because they require the establishment and maintenance of records for each client, as well as those operating on their behalf. However, the KYC framework ensures that the customers are safe, and the bank is aware of its clientele,... --- ### Case Study: Cherry Servers > Learn how Cherry Servers reduced fraudulent payment attempts when using iDenfy's AI-powered identity verification solution. - Published: 2024-01-21 - Modified: 2024-08-29 - URL: https://www.idenfy.com/use-cases/cherry-servers-idenfy-study/ - Categories: Use Cases Discover how Cherry Servers evolved from traditional security measures for payment merchants and implemented a more advanced, AI-powered KYC system. Before iDenfy, Cherry Servers aimed to make their cloud platform accessible in many diverse markets worldwide. After iDenfy, Cherry Servers increased the sign-up conversion rate, helping the company scale faster. The Challenges In today’s digital landscape, secure remote customer onboarding is an industry-standard. This factor led the company to search for a new identity verification solution to ensure a smooth onboarding experience for its customers and lower the number of fraudulent payments in high-risk countries. Cherry Servers noticed the need for a robust ID verification solution when attempts to complete fraudulent transactions started to rise. The fraudulent payment attempts were driving the credit rating downwards. As Cherry Servers officials explained, the company started bumping into numerous fraudulent payment cases coming from different countries: “Before iDenfy’s solution, we didn’t have enough effective security measures. Our team had to deal with increasing chargeback requests,” says Dovilė Minkevičienė, Customer Success Manager at Cherry Servers. “Finding ways to reduce chargebacks, keep our revenue up, ensure customer satisfaction and mitigate losses all at one became a challenge. ” At that time, Cherry Servers relied only on payment merchant verification that applied 3D Secure credit card verification and lowered the number of fraudulent payments. But the issue persisted since this authentication method wasn’t available in all counties that constituted the company’s target market.   The Solution Cherry Servers partnered with iDenfy to build the best possible onboarding experience and reduce fraudulent payment activity. The cloud service provider hit three main targets: created a speedy ID verification process, implemented an extra layer of security, and reduced the number of fraudulent payments. After this collaboration, Cherry Servers noticed more sustainable conversion rates, all thanks to iDenfy’s AI-powered KYC solution. This switch from more typical security safeguards, such as 3D Secure, ensured global inclusivity: iDenfy extracts and verifies data from more than 2,500 identity documents across 190+ countries. The software is backed up by in-house experts who review each verification in real-time, ensuring complete accuracy.   With the identity verification solution, Cherry Servers could accept a higher number of documents from various countries. At the same time, the company ensured compliance across all operating countries. “This fraudulent activity and constant chargeback requests were making our credit rating plummet. iDenfy’s ID verification resolved this issue, reduced fraud, and improved our conversions while allowing us to continue our operations smoothly. ”  Dovilė Minkevičienė, Customer Success Manager at Cherry Servers The Results Cherry Servers was able to implement iDenfy’s identity verification through an easy, straightforward integration process without any technical difficulties. Currently, users can conveniently complete the verification both on mobile and desktop devices.   Since using iDenfy’s fully automated ID verification, Cherry Servers achieved the desired results aligned with their target goals. The cloud platform effectively prevents document forgeries and stolen credit card usage, reducing the new client verification time by 65%. Since 3D Secure wasn’t available to all Cherry Servers’ users, the company partnered with iDenfy. Consequently, the full-stack ID verification solution helped to: Filter fraudulent payments. Minimize the number... --- ### KYC in Social Media: Less Anonymity = More Security? > In the era where the verified badge matters for the users, we find out if social media platforms would integrate mandatory KYC verification. - Published: 2024-01-05 - Modified: 2024-07-18 - URL: https://www.idenfy.com/blog/kyc-in-social-media/ - Categories: Blog It’s as easy as 1-2-3 to create a new profile on any standard social media platform. This makes social networking and online dating not only a great way to connect with people but also to get blindsided by numerous scams. The lack of identity verification and KYC in social media means bad actors can create fake accounts, steal identities, and remain completely anonymous. This harms both users as well as businesses that use social media for their marketing campaigns. Read more. Facebook Marketplace scams with fake listings, X and hate speech, Tinder, and multiple swindlers with fake identities. The list goes on. Know Your Customer (KYC) verification or identity verification, has been a hot topic over the years, splitting the general public into two camps: those who agree that ID verification should be a mandatory requirement on social media and those who stick to the current stance that such measures should remain optional. One thing’s clear. Social media platforms are responsible for ensuring a safe environment for their users. However, in the absence of KYC measures, this becomes far from reality.   Social media and dating apps have become a safe haven for misinformation, numerous identity theft cases, and online fraud. Not to mention the convenience of using social media platforms for new extremes, spreading ridiculous conspiracy theories, using propaganda during elections, or luring into investment schemes. So, the real question is, should businesses, especially those without regulatory oversight, choose not to deal with these issues and avoid implementing identity verification measures? Tag along to see what notes we’ve prepared regarding social media, online dating, and due diligence. How Social Media Became a Perfect Channel for Organized Crime Being recognized as a great communication tool for users and a great sales opportunity for businesses, social media poses challenges through fraud. Organized crime groups, including terrorist organizations, drive the rise of social media crimes and are becoming more sophisticated and automated, with scams targeting specific groups for higher conversion rates. According to the Financial Action Task Force (FATF), over 90% of internet-based acts of terrorism occur through social media channels. That’s no surprise, as the convenience of social media broadened fundraising methods.   Terrorist organizations and organized crime groups use complex tactics to solicit funds from people, specifically targeting sympathetic individuals who are more likely to fall into the traps set by criminals. Apart from Instagram campaigns for terrorism financing, where the platform itself bans accounts with millions of followers, criminals also exploit apps like Telegram, an encrypted messaging service, to finance devious crimes — for example, inviting others to send money for the release of an ISIS member from prison.   Other advancements in online banking and cryptocurrency payments have further minimized the hassle for criminals to facilitate their operations.   So, without KYC verification and using crypto’s shield of anonymity, terrorist groups can remain undetected or caught after the crime has been committed. That’s possible because of their illicit financial activities that aren’t easily detected and often do not raise any red flags. On the other hand, there’s a silver lining between social media and financial crime compliance. People who engage in illegal trades or such transactions online should be screened, particularly checked not only for adverse media but also for what they do on social media. Enhanced Due Diligence (EDD), particularly triggered by a suspicious activity alert, typically catches such behaviors. However, the key point is that since it’s all happening on social media, the financial institution can be... --- ### iDenfy Leads the G2 2024 Winter Batch of Identity Verification Solutions > G2 Winter 2024 identity verification report, AML compliance market summary, and best identity verification software reviews. - Published: 2024-01-05 - Modified: 2024-01-05 - URL: https://www.idenfy.com/blog/g2-winter-2024-idenfy/ - Categories: Blog In the recent G2 2024 Winter batch reports, only 3% of the companies were recognized as industry leaders. G2 reveals that there is a 10% increase in the number of published reports in comparison with the previous quarter. iDenfy continued to lead the way in the identity verification sector by focusing on delivering the highest quality and customer experience. G2 recognized iDenfy with 17 different awards. Here is what customers had to say about iDenfy: What problems is iDenfy solving and how is that benefiting you? “As one of Europe's most reliable investment platforms, VIAINVEST's goal is to continuously provide our investors with top-quality service. Clients anticipate a quick onboarding and screening process with minimal checks and documentation. On the other hand, in full compliance with regulations and our security policies, we aim to maintain the highest quality for risk assessments and client identification. To bridge the gap, we partnered with iDenfy to comply with the latest standards while offering customers a seamless onboarding and investing experience. ” — Alexandrs Puzdrans, Platform Lead at VIAINVEST “I am required to be 100% confident that the signer is who they say they are. The use of Idenfy eliminates any confusion I may have with formats for other countries” — Juanita M. Little-Lyons, Founder at Virginia eNotary Public What do you like best about iDenfy? “The best part of iDenfy is the fact that we could customize our mobile integration to be tailored with our own UX/UI. Their tech support team was always present to guide us. The experience overall, from the first opening to the end of the journey, takes a few seconds and our customers love it. Their APIs are very easy to connect with from any backend. ” — Mihai Daniel E. , CEO at Trust Staking and Xoxno “Being a sensitive business in cybersecurity, we needed a strong platform to apply KYC to our customers. iDenfy onboarding was really smooth, and we implemented the solution in a matter of days. The verification flow itself is flawless and reduced payment frauds dramatically, leaving us more time to focus on our business. ” — Gregory B. , CTO & Co-founder at LeakIX G2 awards summary As part of our goal of contributing to the growth and transparency of B2B, we share the summary of the awarded badges: The Easiest Doing Business - With product in the Relationship Index earned the highest Ease of Doing Business With rating in its category. Leader Small-Business - Products in the Leader quadrant in the Small-Business Grid® Report are rated highly by G2 users and have substantial Satisfaction and Market Presence scores. Most Implementable - The Most Implementable product in the Implementation Index earned the highest Implementation rating in its category. Best Relationship - The Best Relationship product in the Relationship Index earned the highest Relationship rating in its category. Best Usability - The Best Usability product in the Usability Index earned the highest Usability rating in its category. Momentum Leader - Products in the Leader tier in the Momentum Grid® rank in the top 25% of their category's products by their users. Leader EMEA - Products in the Leader quadrant in the EMEA Regional Grid® Report are rated highly by G2 users and... --- ### Ultimate Beneficial Owner (UBO): Verification Guide > Identifying and mitigating Ultimate Beneficial Owner (UBO) risk requires accurate data verification. Find all FAQs to ensure compliance. - Published: 2023-12-29 - Modified: 2025-03-02 - URL: https://www.idenfy.com/blog/ultimate-beneficial-owner-verification/ - Categories: Blog, KYB/AML Any entity falling under Anti-Money Laundering and Anti-Terrorist Financing regulations must know the exact identity of the Ultimate Beneficial Owner (UBO) for all their business transactions. While this isn’t a new regulatory requirement, many organizations struggle to identify UBOs due to various challenges, including complex corporate structures or intentional efforts to hide the UBO status for the sake of financial crime, such as money laundering. Read more. An Ultimate Beneficial Owner (UBO) is an individual who owns or has control over a company. Identifying UBOs is a crucial element in Know Your Business (KYB) and Know Your Customer (KYC) processes. UBO verification aims to prevent major financial crimes like money laundering and terrorist financing.   Regulatory authorities mandate all financial institutions, such as banks, insurance companies, or investment firms, to identify and verify the UBOs associated with their business transactions. That’s why when UBOs are undisclosed, companies open new possibilities for individuals to use the company for money laundering.   Key facts to remember: An Ultimate Beneficial Owner (UBO) is a person or entity with ultimate ownership or control of a company or organization, regardless of the legal owner. The UBO legislation has been designed to provide corporations with clarity regarding the individuals or entities with whom they are conducting business, reducing the chances of doing business with shell companies and other entities that are facilitating criminal activities. UBO verification is crucial for countries to address financial crimes effectively and take the necessary measures to reduce the risk of illegal activities and comply with regulatory standards. Identifying the UBO is crucial for anti-money laundering, anti-corruption, corporate governance, and risk management efforts. Why is Ultimate Beneficial Ownership Important? In recent years, regulators have strengthened their efforts to combat money laundering and terrorism financing. UBO legislation helps identify fraudulent entities that resort to using offshore accounts to conceal their activities.   The key reasons why companies must accurately identify beneficial ownership include: Ensured security. UBO verification acts as a deterrent against criminals using shell companies to conceal their identities, thereby preventing money laundering. When identifying UBOs, companies must frequently track suspicious transactions that might lead to PO boxes, private residences of unsuspecting residents, and other fictitious addresses.   Compliance with AML regulations. Companies must identify and verify UBOs to comply with Anti-Money Laundering (AML) regulations. The definition of a UBO varies by jurisdiction, but typically, a UBO is considered an individual holding some sort of percentage of the capital or voting rights in the company. The EU introduced the Fifth Anti-Money Laundering Directive (5AMLD) to enhance transparency in financial transactions. As per 5AMLD, UBO checks should extend to higher-ranking officials and senior managers. Additionally, under this directive, UBO lists must be accessible to the general public, and information regarding trusts must be available to authorities. Related: What are the EU’s Anti-Money Laundering Directives (AMLDs)? Complete History Overview Who is Considered an Ultimate Beneficial Owner? Customers are considered to be the Ultimate Beneficial Owner if they represent the legal owners or entities that ultimately exert control over a company. In many jurisdictions, a person is considered a UBO if they are: A beneficiary of at least 25% of the capital of the legal entity. Holding a minimum of a 25% stake in the capital of the legal entity. Possessing at least 25% voting rights in the general assembly. An ultimate beneficial owner is considered to be a natural person who... --- ### Video KYC: What Does it Look Like in 2025? > Forget visiting physical bank branches, or perhaps even video calls and lengthy KYC questionnaires. We explain the right Video KYC approach. - Published: 2023-12-29 - Modified: 2025-01-07 - URL: https://www.idenfy.com/blog/video-kyc/ - Categories: Blog Video KYC goes beyond the traditional hassle of a video call verification process. Previously, customers had to navigate through network, camera, and microphone access checks, along with pre-checks, before engaging in video KYC. However, the contemporary version of the video KYC process is a game-changer. It is now accessible 24/7, not confined to business working hours, while still meeting regulatory requirements and enhancing the overall onboarding experience for customers. Read more. Often, video KYC operates in two modes: agent-assisted and self-serve. Businesses can incorporate a video interview as part of the Know Your Customer (KYC) process or automatically capture video at the customer onboarding phase and later examine the results during a manual review. Video KYC involves remotely verifying a customer's identity through a live video interview, eliminating the necessity for physical presence. Over the years, KYC has changed to reach customers where they are, use new technologies, and better tackle the tricks of fraudsters. In response to the escalating fraud challenges, businesses had to seek innovative solutions to enhance customer experience and streamline their operations. Video Know Your Customer (vKYC) has emerged as this innovative solution, swiftly gaining huge popularity.   Video KYC verification combines the convenience of online ID verification with the security of face-to-face interactions. This involves gathering customer data, conducting real-time video interviews, and performing necessary checks to ensure compliance with regulations. As a new technology, it offers several advantages over traditional methods, including heightened security, improved customer experience, and faster onboarding. But how does the integration of video into the KYC process work, and can we actually make the customer experience smoother in practice? Let's find out. What is Video KYC? Video KYC, or vKYC, refers to the process of verifying the identity of individuals remotely through video calls, typically for financial or business transactions. It’s a popular KYC method that incorporates video, also known as video verification or video-based customer identification process (V-CIP). Video KYC is based on live video interactions to confirm the identity of the user by assessing various identification factors, such as document verification, facial recognition, and biometric data, in compliance with regulatory requirements. Through the application of video verification technology, banks and other companies can enhance their ability to verify customer identities and reduce risks associated with fraud and identity theft. Video KYC aims to enhance security and streamline the onboarding process while maintaining the necessary due diligence in customer identification. Keep in mind that the specific implementation of video KYC varies depending on how it is integrated into a business's KYC workflow.   What is the Difference Between Traditional KYC and Video KYC? The key difference is the use of real-time video interaction in video KYC, which enables immediate verification and reduces the reliance on physical document submission. Here’s a more in-depth explanation: Traditional KYC means verifying customer identity through physical documents like government-issued IDs, bank statements, and utility bills, which the company’s internal KYC analysts manually review for validation. These processes rely on paper-based procedures that are time-consuming, labor-intensive, and prone to human error, which also can cause delays for the end customers. Video KYC presents a digital alternative to this method. Using video conferencing technology, customers can remotely complete the KYC process without the need to visit a banking branch. By incorporating technologies like AI or biometrics, companies can take Video KYC one step further and offer their customers a faster and more accurate verification process. Banks and... --- ### What is Fraud Detection? [2025 Edition] > As fraud techniques evolve along with the wild use of AI, companies must find a way to balance out fraud detection and good user experience. - Published: 2023-12-27 - Modified: 2025-01-21 - URL: https://www.idenfy.com/blog/fraud-detection/ - Categories: Blog Fraud detection tools are one of the most prioritized parts of a robust anti-financial crime strategy. Despite governments and their increasing regulatory compliance efforts, fraudsters are using AI and other advanced techniques to surpass identity verification checks or even avoid reporting thresholds and launder illicit funds through devious structuring methods. Consequently, businesses must find a way to build an effective fraud detection and prevention strategy with the right automated solutions. Learn more. Heightened operational costs, challenges in staff retention, increased fraud prevention threats, and never-ending changes in regulatory compliance. These are at least some of the challenges companies face today. From looking for the best identity verification solution to completing the onboarding process to implementing an AI-powered tool for ongoing due diligence, this is just a small piece of the puzzle in the complex fraud detection landscape.   Fraud detection is especially important in the first customer cycle or the customer onboarding stage in order to catch criminals before they start their devious schemes, even on a larger scale. That’s why financial institutions and other companies with money flow ask customers to submit identity, residence, income, and asset documents. However, verifying identities through a simple document verification process isn’t enough. And when it comes to fraud detection, manual operations can become a true hassle, leading to more opportunities for criminals.   In this blog post, we talk all about RegTech and how to make your fraud detection strategy a successful multi-layer defense against fraudsters.   What is Fraud Detection? Fraud detection is a strategy that companies implement for various fraud prevention measures, such as screening customer behavior or monitoring transactions to combat fraudulent activity. The term ‘fraud detection’ is closely related to a broader anti-money laundering (AML) strategy. That’s why companies use fraud detection and prevention measures as part of their AML compliance processes. Fraud detection involves identifying and preventing fraudulent activities or attempts. Implementing a fraud detection system is crucial to proactively prevent fraud, safeguarding businesses and consumers from potential financial losses. Businesses have the flexibility to customize their fraud detection programs. Regardless of its structure, fraud detection typically relies on automation and technology, as well as the company and its established policies for effective operation.   Fraud Detection Examples Identity verification is a common example of fraud detection, which confirms that the user is genuinely who they claim to be and a legitimate customer conducting the transaction. As a result, fraud detection acts as a primary security barrier against different types of fraud, from minor crimes, such as a forged signature, to major felonies, like stealing identities. Fraud detection methods must be dynamic, extending beyond identity verification at the customer onboarding process. Other examples of fraud, such as credit card fraud, account takeover (ATO), or phishing, can lead to substantial financial consequences for both businesses and their customers. For this reason, fraud detection is important in many industries, not just banks. For instance, healthcare, cryptocurrency, and e-commerce companies use fraud detection systems to prevent unwanted consequences.   Fraud Classification The Federal Reserve, the central banking system of the US, has created a tool to recognize fraud called the FraudClassifier Model. It’s an interactive system that categorizes fraud based on the payment’s origin and methods that were used, which helps entities accurately identify different types of fraud. It also serves as a valuable tool for developing effective fraud prevention strategies, providing a standardized classification system with clear, step-by-step guidance for users.... --- ### What is Perpetual KYC (pKYC)? > Perpetual KYC or pKYC is the next big thing both for RegTech providers and companies that want to step up their KYC/AML compliance game. - Published: 2023-12-22 - Modified: 2024-07-18 - URL: https://www.idenfy.com/blog/what-is-perpetual-kyc/ - Categories: Blog Perpetual KYC, or pKYC, represents a Know Your Customer (KYC) practice that combines the verification of a customer's identity and risk status. These checks help identify and prevent financial crimes in a more effective and efficient way. They are very important in regulated sectors, as KYC and KYB (Know Your Business) help build a proper fraud prevention strategy. Learn more. Perpetual KYC (pKYC) stands out as a relatively new and effective method for safeguarding customers. Adopted by global RegTech solution providers and businesses from various industries, pKYC elevates the traditional identity verification process by implementing continuous Customer Due Diligence (CDD). This approach can regularly re-authenticate users and identify suspicious activities, this way, helping businesses reduce fraud. What exactly is the pKYC process, how does it work with other compliance frameworks, and is it actually implemented in practice — we answer these and more questions below. What Exactly is Perpetual KYC? Perpetual KYC (pKYC) involves consistently updating and verifying customer information. Typically, this is possible due to the use of automated systems driven by AI, ensuring accurate customer records are maintained through a streamlined and real-time verification workflow. Perpetual KYC checks are designed to confirm the identity and assess the risk status of a client or customer. Unlike a standard Know Your Customer (KYC) program that conducts checks annually or at specified intervals, like customer onboarding, pKYC is based on an ongoing and continuous monitoring approach of individuals and corporate clients. pKYC’s Relevance in the Market pKYC solutions are in high demand in the market right now, especially due to an increase in anti-money laundering (AML) fines. Organizations like the Financial Crimes Enforcement Network (FinCEN) are preparing recommendations, and as more strict rules in the regulatory landscape appear, businesses are searching for effective ways, such as pKYC, to minimize financial crime risks at both an effective rate and cost.   Within the financial services industry, there is a consensus that traditional KYC is becoming obsolete and no longer aligns with current needs. You can say that pKYC has surfaced as a strategic response to the constant complexities of the global financial landscape. In the face of growing sophistication in financial crimes, pKYC provides a proactive solution for customer verification.   Key pKYC Components pKYC goes beyond traditional customer verification methods by using dynamic monitoring and verification methods based on AI-powered tools. This ongoing approach allows businesses to detect and address anomalies or fraud risks more efficiently.   The main components of pKYC include: Automated identity verification. Using AI and ML, pKYC automates identity verification processes, minimizing reliance on manual reviews and boosting overall efficiency. Real-time alerts. Through real-time monitoring of customer data, pKYC facilitates instant anomaly detection, triggering alerts for immediate action. This ensures swift mitigation of risks and enhances the overall proactive response to potential issues. Ongoing monitoring. Unlike traditional KYC, pKYC operates without waiting for scheduled reviews to update customer data. If additional scrutiny is needed, a 'trigger' or 'alert' initiates the CDD process, activated by factors like suspicious behavior, a new entity designation, or a customer modifying identifying information. What is the Difference Between Traditional KYC and Perpetual KYC? Traditional KYC operates at predetermined intervals within the customer relationship, while perpetual KYC adopts a real-time, ongoing approach to due diligence. Unlike traditional KYC, which may involve outdated data, perpetual KYC ensures the continuous accuracy of customer information throughout... --- ### 40 Recommendations of the FATF — Overview > 40 Recommendations of the FATF are a foundation for global AML/CTF frameworks, which are both crucial and beneficial for many businesses. - Published: 2023-12-20 - Modified: 2024-07-18 - URL: https://www.idenfy.com/blog/40-recommendations-of-the-fatf/ - Categories: Blog The Financial Action Task Force, or the FATF, is a global regulator and a leading intergovernmental organization that aims to help companies address money laundering and terrorism financing issues. The FATF provides guidance, also known as 40 Recommendations, expecting its wide list of member jurisdictions to adopt and implement a unified AML/CFT approach. By doing so, regulated entities can effectively establish a robust anti-money laundering program and contribute to the ongoing battle against fraud and financial crime. Read more. The Financial Action Task Force (FATF) has emerged as a key international authority combating money laundering and terrorism funding since its establishment in 1989.  The regulatory watchdog introduced the 40 Recommendations to combat illicit activities, offering nations guidance on developing effective anti-money laundering regimes. Last updated in November 2023, this unified framework now targets money laundering, terrorist financing, and the funding of weapons of mass destruction proliferation. In general, the main goal of FATF is to reduce crimes that could threaten the global financial system. To achieve this, FATF focuses on creating and encouraging the effective implementation of legal, regulatory, and operational measures to combat the mentioned crimes. In summary, the 40 recommendations of FATF guide companies to: Identify financial crime. Recognize different types of financial crime threats within a country's existing policies and systems. Implement anti-fraud policies. Develop and implement policies and procedures in the country's financial infrastructure to counter identified threats, including money laundering, terrorist financing, drug trafficking, and weapon trading. Build a proper AML program. Create preventive measures for financial institutions and reporting entities in line with FATF's AML and CFT recommendations. These measures include record-keeping, transaction monitoring, customer due diligence, and AML screening. Collaborate with law enforcement. Equip the country's law enforcement entity with the authority to enforce laws and oversee reporting entities while implementing risk prevention measures. Practice accountability. Promote accountability at all levels within the system and maintain a fair judiciary in the country. In this blog post, we continue to review the main policies and procedures of FATF’s 40 Recommendations, helping companies establish a practical AML program based on international standards. What is the FATF? The Financial Action Task Force (FATF) is an intergovernmental body consisting of 39 members, including 37 countries, the United Nations, and the World Bank. Established in 1989 as a watchdog for Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT), FATF provides guidance to governments on combating financial crimes. FATF issues guidance to align international standards and advise countries on the most effective ways to prevent illegal activities. Given the ever-changing landscape of financial crime, FATF regularly updates and revises its recommendations. The History of the FATF Claiming the title of the leading international policy-making body, the FATF has been actively reinforcing new measures. This includes setting stricter regulatory frameworks for newly emerging industries and increasing its efforts to combat not only money laundering but also other comprehensive financial crimes.   We provide a brief overview of the FATF throughout the years below: Establishment The FATF, also recognized by its French name, Groupe d'action financière, was established in July 1989 during the G-7 Summit in Paris. It was initially designed to address money laundering and drug trafficking. However, after the events of 9/11 in 2001, the organization expanded its focus and included combating terrorist financing.   Introduction of 40 Recommendations In April 1990, less than a year after its establishment, the FATF issued a report introducing the 40 Recommendations, a comprehensive plan to combat money laundering. Due... --- ### What is Enhanced Due Diligence (EDD)? [With Examples] > Enhanced Due Diligence (EDD) is a set of measures for high-risk customers or transactions. Find a detailed explanation of all requirements. - Published: 2023-12-18 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/enhanced-due-diligence/ - Categories: Blog Enhanced due diligence (EDD) is a set of measures designed to assess customers based on their risk profiles. EDD is based on a risk-based approach that helps companies gather comprehensive information about their customers and safeguard against crimes, such as money laundering or corruption. Enhanced due diligence plays a crucial role in addressing these challenges and is the key process for dealing with high-risk customers. In the current business and regulatory environment, companies go beyond mere profit considerations. That’s no surprise, as every year, millions in illicit cash flow go through the financial system undetected. So, despite law enforcement efforts to prevent illicit activities, businesses must go the extra step and actively seek to understand the entities they engage with.   For companies aiming to mitigate the risks of money laundering and terrorist financing, this involves the identification and verification of customers' identities, aligning with Know Your Customer (KYC) and Anti-Money Laundering (AML) guidelines. In the meantime, Enhanced Due Diligence (EDD) is an extension of the KYC process, offering a more in-depth risk-based approach. Depending on the assessed level of ML/TF risk associated with a specific customer or business relationship, companies may opt for Simplified Due Diligence (SDD), Customer Due Diligence (CDD), or EDD. The EDD process includes additional measures that companies must employ to scrutinize and monitor high-risk customers and detect potential money laundering activities. The Definition of Enhanced Due Diligence Enhanced Due Diligence (EDD) is an advanced risk assessment process that involves gathering and analyzing information about high-risk customers or business relationships to identify and mitigate potential financial crimes, such as money laundering and terrorist financing. EDD for businesses means implementing a set of additional measures designed to check and monitor high-risk or high-net-worth customers and their high-volume transactions. Given the elevated risks associated with these customers and transactions, they undergo stringent regulation and monitoring to ensure compliance and integrity within the financial sector. EDD measures consist of different procedures, such as: Collecting customer information (for example, their name, date of birth, address). Identifying the customer's beneficial owner. Defining the purpose and intended nature of the business relationship, and more. In simple words, EDD is an extended KYC and AML process that intensifies the scrutiny of potential business partnerships, uncovering risks not detectable through standard due diligence. The Difference Between Customer Due Diligence and Enhanced Due Diligence While Customer Due Diligence (CDD) establishes the groundwork for risk assessment, Enhanced Due Diligence (EDD) builds upon it by introducing additional measures to achieve a more comprehensive understanding of high-risk customers. The primary difference between CDD and EDD lies in their scope of application. CDD is a standard practice applied to all customers, while EDD is specifically reserved for high-risk customers who warrant additional scrutiny. Regulated entities are mandated to have a clear understanding of their business relationships. Consequently, businesses striving to fulfill CDD and EDD requirements engage in Know Your Customer (KYC) checks. KYC encompasses not only CDD but also involves customer identity verification and continuous monitoring. Similarly, it's essential to recognize that EDD is just one component within the broader framework of CDD. Several characteristics that differentiate enhanced due diligence from standard customer due diligence: Risk assessment. EDD focuses on assessing and mitigating higher risks associated with specific customers, while CDD aims to establish the customer's overall risk profile. Information depth. EDD necessitates more extensive information gathering and analysis compared to CDD. Naturally, that’s... --- ### AML/KYC Guidelines for Fintech Companies > There are many automated AML/KYC tools in the market. But they aren't enough for fintech companies to stay compliant. Read the full guide. - Published: 2023-12-14 - Modified: 2024-12-03 - URL: https://www.idenfy.com/blog/aml-kyc-fintech/ - Categories: Blog By now, we all know what the buzzword “Fintech” means. It includes companies like Visa or PayPal, products such as crypto, and other services like Venmo. But while it is all shiny and bright on the outside, internal business operations, especially AML/KYC compliance, aren’t easy for fintechs. The growing volumes of transactions and, naturally, all of the complex fraud schemes make it challenging for financial service providers to stay compliant and, at the same time, provide an effortless user experience. This is where automated tools like identity verification and AML screening come in handy. Read more. In the era of digitalization, Fintech companies face numerous threats, particularly from the burden of regulatory challenges. Additionally, automated processes, cross-border transactions, and lack of regulatory rules in some jurisdictions create a suitable channel for criminals to launder funds, create shady shell companies, and, overall, exploit the financial system.   To combat these risks, fintech businesses must always maintain the trust of their clients and stakeholders. Not only that, but stringent laws with new amendments, such as the EU’s Anti-Money Laundering Directives (AMLDs) or the US Bank Secrecy Act (BSA), require the fintech industry to fight back against fraud.   That starts with implementing proper Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance measures, which are extremely important. To actually build a robust AML program, fintechs must stick to at least five stages, which involve screening sanctions lists, looking for Politically Exposed Persons (PEPs), conducting AML training, collecting and reporting data, and much more. In this blog post, we talk about AML/KYC obligations and how to achieve both complete compliance and great user experience for fintech companies. What is AML in Fintech? AML in fintech is the process of identifying people involved in money laundering, aiming to safeguard the fintech industry and other financial institutions from financial crimes. The primary goal of AML compliance is to ensure the overall security of financial institutions for all customers. Since the fintech industry is a well-known target for money laundering, it’s crucial for fintechs to detect money laundering cases as efficiently as possible.   What are the Main Fintech AML Risks? Law enforcement and regulatory authorities establish effective fraud prevention rules for fintechs to manage their AML risks effectively. That said, fintech businesses should know the key types of AML risks to understand better how to deal with them in an effective manner: Transaction speeds. The increasing speed of the internet and connectivity enables customers to complete transactions in seconds, making instant payments a reality. Money launderers might take advantage of this convenience by swiftly moving large sums of funds into and out of accounts or between different fintechs, avoiding the scrutiny of legal authorities. Customer identities. As fintech products and services operate online, money launderers exploit the anonymity associated with online transactions. They might submit incomplete, misleading, or false personal information to avoid AML controls.   Regulatory gaps. The rapid advancements in technology-oriented sectors, such as fintech, often surpass the capability of regulators to address illicit activities promptly. Money launderers exploit this open door, identifying weaknesses and blind spots in regulations. Given these AML risks, fintech companies must effectively combat money laundering and other financial crimes, regardless of scale. What are Automated Fintech AML Compliance Solutions? Fintech companies use automated AML compliance solutions to detect and report suspicious transactions, involving processes such as AML screening and ongoing monitoring to prevent money laundering. Automated AML compliance solutions facilitate global businesses in adhering to both local and international AML regulations.   The fast-paced fintech environment, where funds swiftly move across continents, requires robust... --- ### Virtual Asset Service Providers: The FATF Travel Rule Obligations > Who are and who exactly aren't supposed to be virtual asset service providers (VASPs)? We explore AML and FATF's Travel Rule requirements. - Published: 2023-12-06 - Modified: 2024-09-27 - URL: https://www.idenfy.com/blog/virtual-asset-service-providers/ - Categories: Blog - Tags: Identity verification Virtual asset service providers, or VASPs, are entities that carry out exchanges between different forms of virtual assets or between virtual assets and fiat currencies. There are many different virtual assets out there. Today, they’re like digital representations of value that can be traded, transferred digitally, or even employed for payment and investment purposes. Read more. Key facts to remember: Virtual asset service providers (VASPs) are a fairly newly established sector in many jurisdictions. To put it simply, VASPs include exchanges, P2P platforms, crypto ATMs, custodians, and OTC desks, among others. A virtual asset (VA) is a digital form of value that can be traded or transferred online. Virtual assets are both suitable for payment and investment. According to the Financial Action Task Force (FATF), VASPs are more prone to serious risks. For example, VASPs can be exploited by criminals and terrorists for money laundering and funding terrorist activities.   The FATF's guidance on virtual assets and VASPs, employing a risk-based approach, provides a precise understanding of virtual asset service providers. They played a crucial role in comprehending how FATF Recommendations affect cryptocurrency businesses. Today, anti-money laundering and counter-terrorism financing (AML/CTF) frameworks are applicable to specific crypto assets and services worldwide, and these definitions guide the determination of which types of digital assets and service providers should be addressed by AML compliance regulations on a global scale. We talk more about this topic, covering all the basics that you need to know about VASPs and their legal obligations. The Origin of Virtual Asset Service Providers (VASPs) In 2019, the FATF expanded its efforts against money laundering and other financial crimes. The organization presented its report called "Guidance for a Risk-based Approach to Virtual Assets and Virtual Asset Service Providers. "  Since then, FATF has conducted multiple reviews to check how well countries follow their created standards. FATF has also covered new risks and emerging market changes, like in Decentralized Finance (DeFi), Non-Fungible Tokens (NFTs), Peer-to-Peer transactions (P2P), or stablecoins. The Role of the FATF and VASPs According to the FATF, the virtual asset ecosystem has made its way to build anonymity-enhanced cryptocurrencies, decentralized exchanges (DEXs), privacy wallets, and various other services throughout recent years. However, such services contribute to reduced transparency and increased obfuscation of financial flows.   According to the FATF, these new virtual asset business models pose risks related to money laundering, terrorist financing, market manipulation, and other fraud types. Moreover, emerging illicit tendencies include the growing use of virtual-to-virtual layering schemes. These scams aim to further hide illicit funds in a relatively easy and cost-effective way. To combat fraud risks, the FATF provided universal AML compliance guidance for VASPs, financial institutions, other designated non-financial businesses, and other reporting entities. The FATF aims to help companies detect and report suspicious transactions.   The mentioned FATF report explains how to assess the risks of money laundering and terrorist financing associated with virtual assets. It also covers topics such as licensing and registration, actions needed to acquire customer information, as well as secure storage of this information.   Related: What is a Risk-Based Approach to AML? What is a Virtual Asset Service Provider (VASP)?   A virtual asset service provider involves the process of issuing a virtual asset or conducting one or more specific activities on behalf of someone else. In general, a VASP has the... --- ### KYC for Forex Trading: Importance and Challenges > Forex trading has many users who want to stick to its decentralized roots and leave KYC out of it. But the industry has become regulated. - Published: 2023-11-30 - Modified: 2024-10-04 - URL: https://www.idenfy.com/blog/kyc-forex-trading/ - Categories: Blog An increasing number of individuals engage in forex trading on a daily basis, drawn by the potential to earn a consistent income. Despite the ongoing high liquidity and global market volatility, forex trading volumes have steadily risen over the years. However, the industry isn’t immune to illegal activities, such as money laundering and ATO fraud. These illicit actions have exposed the sector's previously perceived anonymity, highlighting the associated risks. We talk more about KYC compliance and how identity verification can help prevent forex fraud. KYC, or Know Your Customer, is a regulatory compliance requirement for many industries, including forex trading, requiring obliged entities to conduct identity verification procedures. Companies that deal with trade or exchange of financial services, such as forex, must verify their customers to check who they’re working with.   Typically, this process of identifying and verifying a customer’s identity happens during the account opening stage and periodically afterwards. In simpler terms, forex trading platforms are required to confirm that their clients are indeed the individuals they claim to be. According to recent statistics, investment-type scams resulted in a loss of over $115 million in the first half of 2023 alone. This accounts for nearly 60% of the total fraud losses of the year. While some customers don’t want to disclose their personal information when trading, and while some forex exchange businesses don’t want to invest in compliance tools, it’s safe to say that KYC is the only way to go.   Letting your customers slide without proper identity verification can lead to enormous non-compliance fines. Additionally, there are many underage traders and teenagers who are looking for ways to earn money online. That means forex trading platforms without KYC verification potentially allow minors access to age-restricted services. That’s both illegal and unethical. Key discussion points:  The definition of KYC in forex The importance of KYC checks for forex platforms KYC regulations in forex trading KYC challenges forex companies face today Best types of KYC solutions for forex trading What is KYC in Forex? KYC is a legal mandate for forex platforms to verify their customer identities. The specific customer data required for collection can vary across countries, but typical requests from forex trading operators include: Passport or national ID number, along with the country of issuance Residential or business address Date of birth Phone number Email address Other financial details, including the purpose for opening a trading account and the source of funds. Forex companies typically verify this information using the document verification process. It typically involves verifying government-issued documents, such as passports, ID cards, utility bills, and bank statements. The forex market is decentralized, lacking a physical location for currency trading. Instead, traders use the internet to access currency quotes from global dealers. As a result, KYC is crucial in forex trading because of its decentralized nature, which naturally brings a certain level of anonymity. Why is KYC Important for Forex Trading Businesses? There are several participants that make up the forex market. Key players range from central and commercial banks to investment funds. However, with that in mind and the global interest in the forex market, the threat of scams is on the rise. KYC is important for forex trading businesses that want to reduce the risk of fraud and associated dangers. Moreover, this proactive approach equips forex companies to navigate evolving KYC and anti-money laundering (AML) regulations, preventing steep fines and penalties. Here are the three key risks of non-compliance, leading forex trading businesses to these consequences: Damaged... --- ### AML Compliance in Spain  > Explore the key AML compliance requirements in Spain and learn how to avoid fines and reputational damage with automated RegTech tools. - Published: 2023-11-29 - Modified: 2024-10-04 - URL: https://www.idenfy.com/blog/aml-compliance-in-spain/ - Categories: Blog, Regulations by Country AML compliance penalties have made many breaking stories in the news this year, with some European financial institutions making the cut. As these non-compliance fines sometimes reach millions, many countries, including Spain, have increased their focus on strengthening AML measures. Read more to learn how to achieve AML compliance in Spain and fight financial crime more effectively. Spain ranks among the wealthiest countries in Europe, boasting a highly developed economy that stands as the world's 15th-largest by nominal GDP and the sixth-largest in Europe. Despite its economic background, Spain is not immune to criminal activities. Criminals often target this nation, aiming to exploit its financial system for fraud and other financial crimes, including money laundering and terrorism financing. In a recent report, Spain ranks third in terms of threat levels and is experiencing growth in terms of fraud. With the widespread use of digital channels and a 94% internet penetration rate since 2022, chances are that fraudsters will exploit news channels. To counter these threats, the Spanish government has implemented a comprehensive framework for anti-money laundering (AML) and the prevention of terrorism financing (CFT).   AML compliance in Spain aims to protect the country's economic system and fulfill global responsibilities in combating financial crime. Additionally, due to the possibility of financial penalties, it’s crucial for businesses to fight money laundering, ensure compliance, and effectively navigate emerging regulatory changes. The History of AML Compliance in Spain The FATF reports that Spanish authorities have effectively disrupted the financing of terrorist groups. However, there are still shortcomings in implementing targeted financial sanctions. These limitations hinder the ability to freeze assets associated with terrorism. As money laundering methods and technologies evolved, adjustments were necessary to enhance the fight against fraud. Back in 1988, Spain incorporated money laundering as a criminal offense into its regulatory framework to combat the pervasive drug trade in the country. Spain broadened the scope of money laundering crimes and intensified penalties through amendments to its penal code in 1995 and 2003. Compliance with FATF Recommendations Today According to the Mutual Evaluation Report on Spain's implementation of anti-money laundering and counter-terrorist financing standards, Spain was found to be "Compliant" with 28 and "Largely Compliant" with 10 of the FATF 40 Recommendations.   The FATF Recommendations offer a comprehensive set of measures for countries to address illicit financial flows. This includes establishing robust laws, regulations, and operational measures to empower national authorities in effectively detecting and disrupting financial flows that support crime. The 40 Recommendations are categorized into seven areas: AML/CFT policies and coordination Money laundering and confiscation Terrorist financing and financing of proliferation Preventive measures Transparency and beneficial ownership of legal persons and arrangements Powers and responsibilities of competent authorities and other institutional measures International cooperation Spain’s AML Compliance Regulator Founded in 1993, the Commission for the Prevention of Money Laundering and Financial Crimes, known as Servicio Ejecutivo de la Comisión de Prevención de Blanqueo de Capitales (SEPBLAC), is Spain's main regulatory body for AML compliance. Additionally, it functions as the country's financial intelligence unit (FIU). In its supervisory capacity, SEPBLAC is tasked with ensuring that financial institutions comply with Spain's risk-based anti-money laundering and counter-terrorist financing regulations, aligning with "the best international practices. " Serving as the FIU, SEPBLAC manages the reception of suspicious transaction reports (STR) and analyzes financial data for further investigations. Spain’s Take on... --- ### Age Gating vs Age Verification: Protecting Minors Online > We know those pop-ups that appear when confirming our age - asking to tick a box. But are age gates secure? Learn all about age verification. - Published: 2023-11-27 - Modified: 2024-10-07 - URL: https://www.idenfy.com/blog/age-gating-age-verification/ - Categories: Blog “Are you over 21 years of age?” isn’t the most secure age gating method out there today. In other words, age gating refers to an online practice where users are asked to provide their birthdate, select their age, or confirm that they meet the legal age requirement to access age-restricted content. To minimize the chances of minors bypassing such age gates, more businesses use AI-powered age verification systems instead. Read more. Typically, we associate age gates with checkboxes and random pop-ups, and that’s exactly what they are. To this day, an age gate is a popular way for businesses to confirm a person’s age. Like other age verification methods, age gating helps restrict minors from accessing certain services, such as iGaming platforms or adult-oriented content.   However, age gating is criticized among the public due to its huge security gaps. Under-age users tend to lie about their age and use fake date of birth data to access online e-commerce shops for alcohol and similar age-restricted products. In contrast, regulators worldwide have been presenting strict rules, pushing companies to adopt more robust age verification solutions that require verifying a customer’s identity through document verification, for example. In this case, an automated age verification solution should be implemented to check the person’s government-issued ID document.   We explain both processes and pinpoint the key factors allowing you to determine which solution — age gating or age verification — better meets your business needs.   What is Age Gating? Age gating is a method to restrict access to specific features or content on a website. Companies use age gating to prevent children from engaging with material unsuitable for their age. Typically, users must enter and confirm their birthdate during the age gating process.   An age-gating example is a simple confirmation box that verifies that the customer meets a specified age requirement and can access certain content. Despite serving as a reasonable protective measure, age gating has its drawbacks, including susceptibility to abuse and reliance on user honesty.   In response, online platforms often explore more robust solutions, such as age verification, to address these limitations. This vulnerability has led to the enactment of age restriction regulations in several states, particularly for pornography websites. Ultimately, age gates rely on the user's honesty, making them susceptible to easy bypassing by individuals who simply provide false age details. Examples of Age-Gated Content As many businesses shift to the digital space, businesses must protect age-gated content with security in mind. Age-gated content is also categorized as a "soft" form of age verification, where users confirm their age without actually completing a proper KYC check. Here are some popular examples of age-gated content: Social media Streaming platforms Cannabis Alcohol Gaming and gambling Firearms Adult content Tobacco products Additional merchants might seek parental consent and age verification, especially on social networks that deal with sensitive data. This ensures that children can’t access potentially risky or inappropriate content. Examples of Age Gates Online The most popular example of age gates on a website is a checkbox or a form field prompting customers. To illustrate this matter further, here are some age gates examples: Alcohol. Online platforms selling alcoholic beverages employ age gating, requiring users to verify their age before accessing or making purchases. For example, an e-commerce beverage company prompts users with "Are you over 21 years of age? " and requires a "yes" click for site entry for customers... --- ### AML Compliance for the Luxury Goods Market > The high value and easy transportation factors turn luxury goods into a great channel for money laundering, requiring robust AML compliance. - Published: 2023-11-23 - Modified: 2024-10-08 - URL: https://www.idenfy.com/blog/aml-luxury-goods/ - Categories: Blog The luxury goods market has had its fair share of interest both from buyers and money launderers. That’s why it’s no longer a surprise if the news is filled with a headline about a money laundering scandal or a related financial crime involving a luxury brand selling jewelry, yachts, private jets, etc. In this blog post, we explore the key ways criminals use high-value commodities as channels for their crimes and dive into AML compliance specifics. Generating billions in revenue, luxury goods companies, such as art, wine, jewelry, cards, and private jets, are a primary example of how a picture can be shiny on the outside but rotten on the inside. Beyond the simple act of purchasing luxury goods with funds gained from criminal activities, there’s a lesser-explored channel to the relationship between luxury items and financial crimes.   That’s why only a few know that these goods not only serve as a destination for illicitly obtained money but also play a huge role in facilitating various forms of money laundering. To mitigate the threat of financial crime, luxury goods market companies have adopted diverse anti-money laundering (AML) measures aimed at boosting transparency and adherence to anti-money laundering regulations.   We’ll discuss how money laundering works while pinpointing the importance of different AML compliance initiatives for the luxury goods industry.   What are Luxury Goods? Luxury goods refer to high-end, typically non-essential items that are often associated with premium quality, exclusivity, and significant cost. In the context of AML compliance, luxury goods can be vulnerable to illicit financial activities. In many countries, high-value goods dealers are subject to the same AML laws that apply to banks, iGaming platforms, cryptocurrency, and other industries. AML regulations require businesses involved in selling luxury goods, such as high-end fashion, jewelry, art, and vehicles, to implement measures to prevent money laundering and terrorist financing. This includes conducting due diligence on customers, monitoring transactions for suspicious activity, and having robust risk assessment and systematic frameworks in place to mitigate the risks associated with these valuable and often portable assets. Why is AML Compliance Crucial in the Luxury Goods Sector? China, France, Italy, Japan, the United Kingdom, and the United States constitute some of the world's largest luxury markets. In 2023, the revenue in the Luxury Goods market reached $354. 80 billion, with an anticipated annual growth rate of 3. 38% until 2028. The biggest segment within the market is Luxury Fashion, accounting for a market volume of $111. 50 billion. Despite that, while banks are the primary source of suspicious activity reports,  luxury goods dealers are known for their low levels of reporting. Naturally, the scope of the luxury goods market size requires companies to react and implement more robust anti-fraud measures. They are extremely important to prevent the flow of dirty money into luxurious assets without any consequences or detection. Especially since this culture of confidentiality has had a negative impact on the luxury art market.   For example, in transactions, buyers and sellers often resort to using foreign and offshore accounts, and mediators, typically engaging in online auctions, play a key role in negotiating and finalizing deals. The Panama Papers, leaked by the International Consortium of Investigative Journalists, exposed instances where high-value art was held through anonymous shell companies to conceal the true owners.   Why are Luxury Goods Companies Subject to AML Compliance Obligations? Luxury assets are a way to "clean" illicit funds using dirty money for reselling purposes.... --- ### AML Automation: Streamlined Compliance 101 for Businesses > What seemed to be a dream a decade ago, is now a reality. Businesses can't live without AML automation. Why? Learn to ensure AML compliance. - Published: 2023-11-20 - Modified: 2024-10-09 - URL: https://www.idenfy.com/blog/aml-automation/ - Categories: Blog The inability to verify certain types of documents, lack of efficiency in various compliance-related processes, missed updates, and no timely feedback on reported issues — yet, the list goes on. If your company has ever experienced any of these AML challenges, just know that you’re not alone. Thankfully, AML automation has evolved, pushing AI and other advanced technologies to assist businesses in streamlining their operations without any hassle. While the cost of compliance rises, there’s a way to save your funds. You’ve guessed it: automated RegTech solutions. With many options in the market and more complex fraudulent schemes out there, finding the right anti-money laundering (AML) compliance solution is now crucial. However, to actually overcome the ongoing challenges of fraud and money laundering, businesses must go through what often seems a never-ending labyrinth of compliance hassles, often requiring careful attention to detail. In this blog post, we discuss AML automation, what it takes to build a compliant AML program, and how an automated AML compliance workflow can benefit your business. What is AML Automation? AML automation is a program or software that uses AI and machine learning to streamline compliance tasks linked to customers and their transactions. For example, an automated AML system can identify and flag high-risk users on an online platform in real-time. Such a solution is used to detect suspicious activity without having to screen and check multiple databases manually.   In practical terms, AML automation is designed to recognize various risk indicators, consisting of not just high-risk individuals but also identifying suspicious transactions and enabling continuous transaction monitoring. Despite the technological aspects, the human element is crucial. Automated AML systems require training and dedicated staff who can use the AML automation and its dashboard to manage AML risks more easily. For instance, real-time AML screening enables instant detection of fraudulent behavior, allowing quick response to mitigate potential impacts on customers and your business. AML automation can be customized to automatically approve or deny customers, blacklist suspicious users and enhance efficiency for your compliance team through streamlined operational workflows.   What is AML Compliance? Anti-money laundering, known as AML compliance, is a set of regulations established by different governments worldwide in order to help financial institutions and other obliged entities to follow a recommended framework for preventing illegal activities, such as money laundering or terrorism financing.   Initially presented by the Bank Secrecy Act of 1970, AML compliance is consistently revised and adopted to better scrutinize activities for signs of financial crime over the years. It’s like a constantly evolving foundation for regulated entities, helping them implement effective policies, procedures, training, and technologies, such as AML automation.   What is an AML Program? An AML program is a company’s strategy and approach to staying compliant with anti-money laundering laws. To have a strong AML program means that the business must follow stringent requirements and procedures.   AML programs play a crucial role in preventing illicit funds from infiltrating the lawful financial system. They help different businesses, both traditional financial institutions and other entities specified in government regulations, such as money services businesses.   An AML program is designed to identify and report suspicious activities, including the underlying offenses that lead to money laundering and terrorist financing, such as securities fraud and market manipulation. That means stopping the money earned from most crimes is a strong way to reduce corruption, tax evasion, theft, fraud, and many... --- ### Financial Crime Compliance: Comprehensive Business Practices > We've all heard of AML, but what about Financial Crime Compliance, or FCC? Read and find detailed, step-by-step insights to stay compliant. - Published: 2023-11-15 - Modified: 2024-10-09 - URL: https://www.idenfy.com/blog/financial-crime-compliance/ - Categories: Blog Whether you're a bank, fintech company, MSB, or any financial entity — you simply can’t avoid financial crime compliance. To stay in line with ever-evolving regulatory rules, businesses must implement effective procedures and protect their reputation, customers, staff members, and investors. In this blog post, we pinpoint the main red flags when it comes to illicit activities, providing insights to shield your operations from potential damage and the risk of becoming a target for money laundering. Financial crime involves a wide range of criminal activities that revolve around money or other financial resources. In the meantime, financial crime compliance is a set of internal policies, procedures, and business practices designed to detect and prevent activities linked to money laundering, fraud, and other financial crimes. If we look back at the past few years, the media was filled with news about political tensions, literal wars, stricter sanctions laws, as well as ongoing economic challenges. And we can’t avoid mentioning AI and the craziness behind its advancements, such as ChatGPT, with its sometimes negative effect on many industries.   So, with all the Ponzi schemes, terrorist financing, tax and investment fraud, corruption, as well as other emerging crimes, such as greenwashing, law enforcement officials are forced to strike back with new ways to address this major threat.   This is exactly why it’s crucial to learn how to navigate the financial crime compliance landscape. To achieve this goal, companies must implement various processes and use the right, preferably automated, crime and fraud prevention tools.   What is Financial Crime Compliance? Financial crime compliance (FCC) refers to various measures that ensure the integrity of the financial system by enforcing laws and eliminating unethical practices. Companies use these tactics to prevent, detect, and report unlawful financial activities.   Financial crime risk management (FCRM) is the process of actively seeking out instances of financial crime. Companies manage their risks by investigating and analyzing suspicious activities, identifying vulnerabilities, and implementing measures to reduce the company’s risk of falling prey to such illicit activities. For example, a bank must have a robust FCRM strategy to prevent money laundering and other fraudulent activities.   In practice, companies minimize financial crime risk by: Identifying risks. Creating a plan to counteract or mitigate risks. Implementing crime prevention systems. Regularly stress-testing prevention systems. Monitoring the effectiveness of these systems. What is the Difference Between FCC and FCRM? While the FCC makes the rules, FCRM works on the ground to ensure everyone follows them. FCRM is a hands-on strategy involving more attention to accounts and transactions with the highest risk. Financial crime risk management is based on a risk-based approach. It balances the level of risk by using suitable controls to minimize the chances and impacts of financial crime. Additionally, risk management means doing different things like assessing risk profiles, using technological solutions, as well as training people in the organization. Why is Financial Crime Compliance Important? In the landscape of fast-moving expectations for financial crime compliance, the importance of understanding all risks and business associates cannot be overstated. Typically orchestrated by individuals, groups, or criminal organizations, financial crime has repercussions that extend beyond major financial losses.   Financial crime not only harms individuals' social and emotional well-being but also damages the reputation of companies. It involves both seeking financial gain through criminal acts and concealing the proceeds. To mitigate these risks, businesses often adopt AI-powered anti-money laundering (AML) tools, which assess financial crime risks and safeguard against... --- ### Case Study: HollaEx > Find out how HollaEx managed to increase its sales by 15% after building a fully automated KYC plugin together with iDenfy's team. - Published: 2023-11-13 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/hollaex-idenfy-study/ - Categories: Use Cases See how HollaEx simplified its ID verification process by switching to a fully automated compliance workflow, creating a universal KYC system for both their platform and their partner exchange businesses, eliminating the need for manual management of IDs. Short Recap Before partnering with iDenfy, HollaEx: Used manual ID verification processes, which resulted in time-consuming issues and increased operational expenses. Wanted to automate customer onboarding and establish a stronger fraud prevention strategy to support their growth goals. After partnering with iDenfy, HollaEx: Switched to a fully automated KYC/AML compliance workflow. Developed a customized KYC plugin for their partners. Enabled a simple and efficient deduction of credits for each user verification. The Challenges HollaEx's main focus is to develop user-friendly crypto tools with the belief that such tools can promote blockchain adoption among businesses of various scales. To support their growth goals, the HollaEx team also wanted to establish a strong fraud prevention strategy. However, the pivotal challenges the company encountered revolved around user identity verification, both for HollaEx’s users and their customers. It’s no secret that HollaEx’s presence is driven by the stringent regulatory demands governing financial and crypto services. In this industry, it's imperative to have a deep understanding of each and every customer using HollaEx's fintech white-label exchange solution.   Consequently, this challenge was driven by the sensitive nature of the documentation required and the necessity for manual verification processes, which proved to be time-consuming and costly for HollaEx. Before integrating iDenfy, HollaEx used manual verification processes, which resulted in time-consuming issues, increased operational expenses, and a greater susceptibility to fraud. “These challenges had a substantial impact, not just on HollaEx operationally but also on our primary customers — the exchange business operators utilizing HollaEx,” says Adrian Pollard, the Co-Founder of HollaEx. “They grappled with the financial burden of managing user IDs and verification processes. ” To elaborate, HollaEx had to navigate compliance with various regulatory standards, contend with rising expenses, and confront the ongoing issue of fraud. This posed a challenge for a business in the process of scaling. The Solution To address these challenges, HollaEx implemented a variety of plugins to provide Know Your Customer (KYC) and Anti-Money Laundering (AML) functionality.   This partnership with iDenfy enabled HollaEx clients to seamlessly integrate into any HollaEx-powered exchange, automating the identity verification process. HollaEx customers leverage camera scanning technology and secure data storage for user information.   “Manually verifying documentation can be very tricky. Not only because of the time involved but also due to the complexity and security around storage and data recall. iDenfy covered this for us and simplified our operational complexity,” adds Adrian Pollard. HollaEx used iDenfy’s identity verification solution and incorporated the custom-tailored KYC exchange plugin as a value-added feature to its selected exchange software packages: For example, exchange business operators receive the Auto KYC plugin, powered by iDenfy, as part of premium HollaEx exchange packages like the Enterprise plan.   In collaboration with iDenfy, HollaEx efficiently handles the deduction of credits for each user verification. Here's a clear explanation of the identity verification process for HollaEx end-users. Automated Document Data Extraction When HollaEx users undergo ID verification, they are directed to a specialized KYC page. Here, users are prompted to choose their... --- ### AML/CTF Compliance in Estonia [Guide] > See this detailed guide to learn about the latest regulations in Estonia regarding AML compliance. Find bonus solutions to stay in the loop. - Published: 2023-11-09 - Modified: 2024-10-11 - URL: https://www.idenfy.com/blog/aml-compliance-estonia/ - Categories: Blog, Regulations by Country In the past decade, Estonia has become an attractive choice for fintech startups and financial institutions aiming to broaden their operations in Europe. However, this “rising star” title burdens companies to stay compliant with the ever-evolving AML/CTF compliance requirements, which we explore in this in-depth article. To counter and prevent financial crimes, Estonia relies on the "Anti-Money Laundering and Terrorist Financing Prevention Act," which was established in 2008 as a foundational measure against criminal activities. This framework applies not only to financial entities but also to non-financial businesses. These regulations in Estonia align with the standards set by the Financial Action Task Force (FATF) and the European Union. Facts to remember: The Financial Intelligence Unit (FIU) is tasked with investigating and scrutinizing potentially suspicious transactions that could be linked to terrorist financing or money laundering. The Estonian finance ministry holds the responsibility for regulating financial institutions and establishing new policies to combat financial crimes.   Both financial organizations and virtual asset service providers are mandated to conduct risk assessments and submit reports on suspicious transactions to the FIU. Reporting to the Financial Intelligence Unit (FIU) of Estonia The Financial Intelligence Unit of Estonia is responsible for receiving and analyzing AML-related reports. It plays a crucial role in identifying and preventing money laundering and terrorist financing activities. If, in the course of economic or professional activity or the provision of professional services, the obliged person identifies activities or circumstances, including: The characteristics of which point to the use of proceeds from criminal activities; The financing of terrorism-related activities; Related crimes and the attempt of such activities; Activities in which they suspect or know that it is money laundering, terrorism financing, or the commission of related crimes. In all of these cases, they are obliged to report this to the Financial Intelligence Bureau immediately but no later than two working days after the activity or circumstances have been identified or suspicion has arisen. Entities are required to report large currency transactions to the FIU. These reports provide information about transactions involving a specified amount of currency or other monetary instruments. Cash Transaction Reporting Obligations The obliged person, with the exception of a credit institution, must notify the Financial Intelligence Unit immediately, but no later than two working days after the transaction, of any transaction that becomes known where a financial obligation exceeding 32,000 euros or an equivalent amount in another currency is settled in cash, regardless of whether the transaction made as one payment or as several interconnected payments within a period of up to one year.   Credit Institution Reporting Obligations The credit institution must notify the FIU immediately, but no later than two working days after the transaction, of each currency exchange transaction in cash in the amount of more than 32,000 euros if the credit institution does not have a business relationship with the person participating in the transaction. Country-Specific AML Compliance Requirements In Estonia, alongside the anti-money laundering directives of the European Union, the central regulation addressing money laundering is the Money Laundering and Terrorist Financing Prevention Act, enacted in 2017. In January 2020, this act underwent amendments to encompass virtual currency service providers, subjecting them to the same regulations as traditional financial institutions. Consequently, cryptocurrency firms are now obligated to: Ensure the enhancement... --- ### How Can RegTech Improve AML Compliance? > Can we imagine today's regulatory landscape without RegTech solutions? Probably not. Dive into the world of AML compliance and technology. - Published: 2023-10-31 - Modified: 2024-10-15 - URL: https://www.idenfy.com/blog/regtech-aml-compliance/ - Categories: Blog RegTech, short for Regulatory Technology, refers to the use of advanced software and data analytics. That means RegTech solutions today can help businesses and financial institutions comply with regulations more efficiently and effectively. But how does that look in practice? Does RegTech actually improve AML compliance? Let’s find out. Recent advancements in computing power and analytical capabilities have definitely enhanced the effectiveness of anti-money laundering (AML) RegTech solutions. However, the concept itself isn’t something new. The global RegTech industry has experienced consistent growth since 2015, driven by the increasing regulatory responsibilities and audit demands placed on financial institutions. Of course, let’s not forget the global pandemic, which also helped the RegTech market scale and reach new heights.   When we talk about RegTech, the first thing that comes to mind is artificial intelligence (AI). While we now have ChatGPT, we know that AI can be similar to the process of human intelligence. In RegTech, it helps recognize patterns and irregularities, a critical aspect of AML transaction monitoring. Not only that, but RegTech solutions can also benefit companies that want to streamline identity verification and AML screening processes.   What is RegTech in the Context of AML Compliance? RegTech consists of various AML compliance solutions. RegTech isn’t related just to banking. It helps maintain regulatory compliance across various industries. In the context of AML compliance, RegTech solutions typically leverage advanced analytics. Popular examples include machine learning, natural language processing, and robotic process automation. They help create such RegTech solutions as identity verification, record-keeping, and screening or ongoing monitoring.   The term “RegTech” originated from "Regulatory Technologies” and has become a vital component of many industries. Fintech, iGaming, cryptocurrency — they all use RegTech solutions today for regulatory compliance, gaining prominence as a response to the growing number of regulations. Use Cases for RegTech in AML RegTech is the main option when it comes to effective AML and Know Your Customer (KYC) programs, which consist of three key elements: customer identification, customer due diligence (CDD), and transaction monitoring. Customer Identification First of all, RegTech solutions streamline identity verification by automating biometric and document verification checks. Biometric verification employs facial recognition, voice recognition, or fingerprint scanning to confirm an individual's identity. In the meantime, document verification assesses the legitimacy of identity documents like passports and driver's licenses using optical character recognition (OCR) and other verification methods. Customer Due Diligence  Customer due diligence (CDD) is a mandatory process for organizations entering into business relationships with customers. It is a crucial component of both KYC and AML compliance frameworks. For example, for Politically Exposed Persons (PEPs) and sanctions screening, RegTech solutions leverage algorithms and AI to cross-reference customers with sanction lists and PEPs databases. This screening process is adaptable to a financial institution's risk tolerance and compliance needs. Companies also use adverse media checks to see if the customer isn’t mentioned in negative news outlets or isn’t listed in global watchlists. In terms of risk assessment, RegTech solutions can automate it through risk-based scoring models. These models utilize machine learning algorithms to analyze customer data, encompassing transaction history and demographics. Such tools help with the determination of the necessary level of due diligence for that customer. Related: What is the Difference Between CDD and EDD? Transaction Monitoring When it comes to transaction monitoring, RegTech... --- ### Smurfing in Money Laundering Explained  > Learn how criminals use smurfing in money laundering to go undetected. Explore effective KYC and AML tools to combat this issue. - Published: 2023-10-31 - Modified: 2024-10-15 - URL: https://www.idenfy.com/blog/smurfing-in-money-laundering/ - Categories: Blog Smurfing isn’t something related to the famous blue fictional characters. In money laundering, smurfing refers to a fraudulent practice of breaking a larger amount of money into numerous smaller portions. In this blog post, we answer the questions of how the funds get laundered later, how smurfing is different from structuring, and more. Money laundering through smurfing is a persistent strategy. That’s because criminals engaged in fraudulent activities employ smurfing to avoid triggering alerts for suspicious transactions.   In the context of professional gaming, the term "smurfing" has a slightly different meaning. Here, it’s a practice of generating multiple user accounts to manipulate gaming platforms or distort ranking systems. But how is this strategy dangerous for businesses, and how can you prevent criminals from laundering large sums of ill-gotten gains? We talk about all things smurfing below.   What is Smurfing? Smurfing is the process of dividing a larger sum of money into many smaller transactions, similar to the tiny fictional blue smurfs. The term “smurfing” has its roots in the drug traffickers' slang. Apparently, such criminals often purchased small quantities of various substances or ingredients they needed to combine and produce the end product. By using smurfing in money laundering, criminals seek to evade detection by financial institutions, taking advantage of reporting thresholds meant to identify suspicious transactions. In other words, this approach aims to split illicit earnings among numerous accounts for criminals to avoid scrutiny. What is a Smurf? A smurf is an individual or group of individuals who engage in money laundering transactions by breaking down a large sum of money into smaller, less suspicious amounts to evade reporting requirements.   A smurf also often refers to a money launderer who practices structuring. Smurfs aim to hide the origin and true nature of their laundered funds. However, it's crucial to emphasize that smurfing is a serious criminal offense with severe legal repercussions. Financial institutions and authorities are actively engaged in detecting and preventing smurfing due to the substantial threat it poses to the whole financial system.   Related: Structuring in Money Laundering Explained What is the Difference Between Smurfing and Structuring? Smurfing is closely linked to structuring. Smurfing is primarily used to avoid regulatory scrutiny and obscure both the nature and origin of the funds. On the other hand, structuring is generally employed to avoid reporting requirements, but the individual involved may not necessarily have the intention of concealing the source of the funds.   While both smurfing and structuring entail dividing substantial amounts of cash into smaller transactions, the crucial difference lies in their purpose and execution: Smurfing is the practice of dividing a large sum of money into smaller transactions that remain below the reporting threshold. The purpose of smurfing is to avoid detection by regulatory authorities, which mandate that financial institutions report cash transactions exceeding a specific limit.   Structuring is a tactic where larger deposits are broken down into smaller sums. For instance, someone might make ten deposits of $9,500 each instead of a single $95,000 deposit, which would trigger the reporting requirement. The primary goal is typically to evade scrutiny by regulatory agencies and conform to the standard reporting requirements of AML protocols. Unlike smurfing, structuring doesn't necessarily require the involvement of multiple individuals or accounts. It often centers around a single person who makes... --- ### What are the 3 Steps to KYC? > KYC can be a hassle-free complex... Only if you do it right. We explain the 3 steps to KYC and how to achieve compliance with the right tools - Published: 2023-10-26 - Modified: 2025-02-25 - URL: https://www.idenfy.com/blog/three-steps-to-kyc/ - Categories: Blog, Identity Verification Knowing your customers properly isn’t possible without KYC or Know Your Customer. Chances are that as soon as you hear this phrase, identity verification comes into mind. Today, this process is also known for strict regulatory compliance across various industries and jurisdictions. What’s the best way to verify a user’s identity? How do we keep the balance between compliance requirements and user experience? What are the 3 steps to KYC? We answer all the burning questions and provide the latest insights below. Implementing Know Your Customer (KYC) processes is not only a way to assess customer risk and ensure a secure business environment but also a mandatory obligation to comply with Anti-Money Laundering (AML) requirements. Understanding applicable laws isn’t enough in today’s fast-progressing environment. More industries, like MSBs and crypto exchanges, are being struck with stricter KYC requirements. But what exactly are they? In this blog post, we provide you with the basic 3 steps of KYC and tips on how to achieve and properly maintain KYC compliance.   What is Know Your Customer (KYC)? KYC refers to Know Your Customer. It’s also known as Know Your Client, customer due diligence (CDD), or the process of identity verification. This process is designed to do a background check on customers before starting a business relationship with them. In other words, KYC verifies user identities to help you better understand who you’re dealing with.   Depending on the risk level, the KYC process occurs during the customer onboarding stage. Additionally, customers can be re-verified later during their cycle, especially in cases when their risk profile changes. Keep in mind that customers in this context can be both individuals and businesses. The fundamental rule for KYC involves three components: Establishing the customer’s identity.   Understanding their background and customer activity while ensuring the legitimacy of their transactional behavior.   Assessing further money laundering risks during ongoing monitoring. Failure to follow primary obligations will result in an ineffective KYC program. Unfortunately, this scenario has severe consequences, such as sanctions, financial penalties, and damaged reputation.   The 3 Steps to KYC Compliance The KYC process consists of three primary steps: CIP, CDD, and ongoing monitoring. We go through each step in more detail below: 1. Customer Identification Program (CIP) The first phase in the KYC process is the Customer Identification Program (CIP). It revolves around collecting and validating customer information. In general, CIP refers to a set of procedures that a business is required to put in place and adhere to for the purpose of confirming the identity of its customers. Typically, this means that customers must submit documents such as government-issued IDs, proof of address, and occasionally proof of income. Moreover, it's essential for businesses to evaluate the risk associated with each customer. This assessment takes into account factors like the customer's occupation, country of origin, and the type of transactions they engage in. Customers deemed high-risk demand additional scrutiny, which leads to the second step of KYC. The primary objective of CIP programs is to verify that customers are indeed the individuals they claim to be. These programs play a crucial role in identifying and preventing occurrences of money laundering, identity theft, and various other types of fraud. Related: What is the Difference Between CIP and KYC? 2. Customer Due Diligence (CDD) Customer due diligence (CDD) involves a series of continuous procedures designed to evaluate customer risk. That’s why, after verifying a user's identity, organizations must gather more information and conduct a deeper assessment of... --- ### What is the Difference Between KYC and CDD? > While KYC and CDD both are vital components of a robust AML program, they have distinct features that businesses must know to stay compliant. - Published: 2023-10-24 - Modified: 2024-10-16 - URL: https://www.idenfy.com/blog/kyc-and-cdd/ - Categories: Blog KYC is designed to verify a current or potential customer’s identity, whereas CDD is a set of measures that lead to the KYC process. CDD is also a key step in KYC compliance. You can say that past KYC practices have evolved into present CDD solutions designed to assess customer risk. Both KYC and CDD can’t work without each other. But what are the biggest differences, and how can businesses stay compliant? Continue to read and find out. Know Your Customer (KYC) and customer due diligence (CDD) are both vital processes in Anti-Money Laundering (AML) compliance. These are the measures that help detect bad actors and are mandatory in many industries, including financial services or crypto.   In simple terms, KYC involves conducting CDD, which means verifying a customer's identity. KYC assists CDD by providing verified customer data to the company to use in CDD transactions. KYC also ensures that essential information is collected and assessed prior to the customer’s account opening process, helping to assess their risk level.   It's challenging to separate KYC from CDD, as CDD is an essential component of KYC. So, without further ado, let’s get into the main differences between these two processes in a more detailed way.   What are the KYC and CDD Processes? Know Your Customer (KYC) is a process that is designed to confirm the identities of existing or potential customers. KYC also helps determine a customer's risk profile by collecting their information before entering into a business relationship. Typically, businesses accomplish this through a digital onboarding process, which involves checking the legitimacy of personal data and identity documents. KYC is also known simply as "identity verification. " This process is applicable to both individual users and businesses. For companies, KYC is known as Know Your Business (KYB) or corporate KYC. These standards help detect, report and ultimately prevent all sorts of fraud and financial crimes. Customer due diligence (CDD), on the other hand, is an ongoing process designed to evaluate customer risk, serving as a pivotal aspect of KYC. Companies conduct CDD checks periodically during the whole cycle of the customer relationship, as it’s mandatory to maintain and update transaction records. That means CDD is a vital component of the KYC process that lasts during customer onboarding and persists throughout the entire lifecycle. Initially, an account may appear to be in compliance with legal requirements, but it can later reveal suspicious activities. In other words, customer risk profiles change, which makes CDD an ongoing process. What is the Key Difference Between KYC and CDD? The main difference between KYC and CDD processes is the timing in terms of customer interaction. KYC checks are made at the early stage of establishing business relationships, when companies screen potential customers, while CDD involves ongoing monitoring of suspicious activities aimed at money laundering. Both KYC and CDD processes are a crucial part of an AML program. In other words, KYC is all about making sure the company knows who their customer is by verifying their identity. The CDD process incorporates a continuous assurance framework. This ensures the consistency of the KYC measures from the start to the end of the customer relationship and stakeholder activity while also helping maintain an effective AML compliance program.   Is CDD the Same as AML? CDD is commonly considered a central element of AML, but it isn’t the same process. AML procedures help prevent money laundering and terrorism financing within an organization. When integrated into... --- ### Money Services Business (MSB) — AML Compliance Guide > As a money services business (MSB), you must follow BSA and AML regulations. This guide shows what companies are MSBs and how they can comply - Published: 2023-10-19 - Modified: 2024-10-17 - URL: https://www.idenfy.com/blog/money-services-business-msb-aml/ - Categories: Blog A money services business (MSB) refers to an entity engaged in activities such as transmitting, converting, or exchanging money. This term is commonly used when talking about Anti-Money Laundering (AML) compliance, especially when trying to identify which MSBs are the obliged entities. This term includes a much broader spectrum of all kinds of financial institutions. Learn more. Today, numerous businesses are in competition to provide cost-effective and diverse options for transferring money. These financial institutions, which also include traditional banks, are known as money services businesses, or MSBs. Non-traditional banks, like neobanks and cryptocurrency service providers, also fall into the MSB category. However, while money services businesses offer essential services to many users, they also have a notorious title for being an attractive money laundering channel. That’s exactly why MSBs must implement AML measures, including Know Your Customer (KYC) and customer due diligence (CDD) processes.   In this blog post, we'll cover what defines a money service business, which businesses usually fit this category, and outline the key anti-fraud and AML compliance requirements for MSBs. What is a Money Services Business (MSB)? A money services business (MSB) is any financial entity, excluding traditional banks, engaged in money transmission, exchange, or conversion. MSBs differ from banks even though they offer similar services. That’s why the term 'Money Services Business' describes various financial institutions, including those involved in crowdfunding, e-commerce, or cryptocurrency services.   Money services businesses remain classified as financial institutions according to the Bank Secrecy Act (BSA) and other related regulations. As a result, MSBs must comply with the same AML/KYC rules as other financial institutions. Naturally, failure to comply with these regulations presents substantial risks for MSBs.   In 2016, the Financial Action Task Force (FATF) updated its risk assessment for money service businesses. Any company that delivers funds to recipients in cash or through a transaction is categorized as a money transfer business. To be classified as an MSB, the company’s transaction's value must be equal to or greater than $1,000 per day.   What Doesn’t Count as an MSB? As per FinCEN, banks are not money services businesses because they have their own set of regulations. Additionally, individuals or entities registered and regulated by the Commodity Futures Trading Commission or the Securities Exchange Commission are also exempt from the category of MSB.   How are MSBs Regulated? Money Services Businesses are required to establish AML compliance programs. They help companies implement protective measures to deter money laundering and other illicit financial activities. In addition to AML programs, MSBs are obligated to register with the United States Department of the Treasury's Financial Crimes Enforcement Network (FinCEN), and in many regions, they must also register with the state where they operate.   To combat fraudulent activities, MSBs must also provide comprehensive training to their employees, implement established AML procedures, and report transaction histories in instances where transfers exceeding $10,000 are completed within a single day.   Quickstart MSB AML Compliance Checklist The 5 key pillars of AML compliance require money services businesses to: Have a designated compliance officer that would be responsible for managing the AML program. Develop internal AML/KYC/CDD policies that also include transaction monitoring and reporting of suspicious activities. Regularly train your employees to stay up-to-date with regulatory compliance. Review and audit your AML program by an independent third party. Implement a risk-based approach... --- ### Examples of Money Laundering and Prevention Methods > Cashing out winnings in a casino, obtaining funds from drugs, or structuring money to avoid AML triggers — meet examples of money laundering. - Published: 2023-10-13 - Modified: 2025-05-16 - URL: https://www.idenfy.com/blog/examples-of-money-laundering/ - Categories: Blog Fraudsters use money laundering tactics to run their schemes without leaving a paper trail. Money laundering remains a major and costly form of fraud for both businesses and the overall global economy. That’s why businesses must actually know their customers and their backgrounds before allowing them to start their transactions. This is where AML compliance and knowing the main examples of money laundering become extremely important. Read more. Money laundering is a dark world and, despite all the technological advancements and AI transaction monitoring tools, remains a prevalent issue even for the biggest financial players out there. A notorious example would be the Danske Bank scandal, where at least €200 billion in suspicious transactions were laundered through the bank’s Estonian branch between 2007 and 2015. While money laundering, hopefully, will not ever reach the heights of Pablo Ecobar, who had an empire of illegal cash so big he had to spend $1,000 a week on bands to wrap his money, it’s still a major issue. In fact, the estimated annual volume of laundered funds is nearly 5% of the global GDP, which is approximately $800 billion. Criminals use various tactics, such as creating shell companies or using offshore accounts to launder money, which makes it a complex task to detect them. So, there’s no doubt that Anti-Money Laundering (AML) practices are here for a reason. For financial institutions especially, striking the right balance between complying with due diligence requirements and fostering trust with customers is a delicate challenge.   Below, we dive deeper into the key examples of money laundering and explain how to detect and prevent fraudsters from getting linked to your business.   What is Money Laundering? Money laundering is the process used by criminals to hide the true source of funds. Typically, criminals mask the illegal money through complex bank transfers or other transactions, turning it into “legitimate,” clean funds. Once the money is clean, fraudsters can securely reintroduce the laundered funds into legitimate financial systems. Criminals resort to this tactic to evade detection and taxation on their illegal earnings. For example, criminals, especially larger groups, get the cash from theft or trafficking. Since they can’t instantly use it or invest these funds, they must integrate the illegal money into the financial system. To achieve this, fraudsters use money laundering measures and clean the money by incorporating it into legitimate channels, like banks or businesses. Here are some common money laundering scheme examples: Using "smurfs" to break down large amounts into smaller transactions and deposit them. Blending dirty cash into the legitimate cash flow of established businesses. Smuggling cash to deposit in a foreign financial institution. Creating shell companies and channeling money through business accounts. Purchasing high-value goods and reselling them to legitimize the profits. Is Money Laundering a Serious Crime? Money laundering is a severe criminal offense that has profound effects, even on the global financial system. Not to mention, money laundering serves as the main fuel that enables drug dealers, arms dealers, terrorists, and various other criminals to sustain and expand their illicit operations. For instance, without money laundering, drug cartels would struggle to convert their illicit proceeds into legitimate assets and expand their operations, leading to less devastating consequences for society. Also, it's important to note that money laundering is a serious crime that can be prosecuted both nationally and internationally. When dirty money is allowed to infiltrate legal financial channels, it... --- ### What are the Key AML Laws in the US? [Business Guide] > While the BSA was introduced in the 1970s, a lot has changed in the modern landscape of AML laws in the US, which poses major challenges. - Published: 2023-10-10 - Modified: 2024-10-21 - URL: https://www.idenfy.com/blog/aml-laws-us-guide/ - Categories: Blog, Regulations by Country Transaction monitoring, verifying business relationships, working with regulators, or training your staff is just the beginning of ensuring compliance with AML laws in the US. Since the BSA was implemented in 1970, the basics for the current AML framework in the country have elevated, posing more restrictions and processes for US companies to stay compliant. Follow our guidelines to learn more. One of the most notorious crimes to this day, money laundering, refers to the method of disguising illegally obtained funds, often referred to as "dirty money," to make them appear legitimate. However, in the 1920s, there were no specific regulations in the US addressing the crime of money laundering. That’s why authorities had to categorize it as tax evasion when prosecuting individuals like Al Capone, who thrived during the era of organized crime. Today, the US stands as the world's largest and most influential economy and takes rigorous measures to combat financial crimes, focusing on enforcing anti-money laundering (AML) laws. Despite such efforts, recent data shows that at least $300 billion is laundered within the United States each year, and American businesses spend approximately $25 billion annually to ensure AML compliance. To properly stick to regulatory frameworks and avoid hefty fines, financial institutions must be well aware of the key AML laws in the US. Use this guide and learn everything you need to know about it below.   What Does AML Compliance Mean in the US? AML compliance means that financial institutions in the US must establish, document, and comply with an AML program with the goal of identifying and preventing money laundering. Each business has to choose how they want to develop and execute the measures in their AML program. That said, there are mandatory AML program elements that are clearly defined by the relevant regulatory authorities. For example, the Financial Crimes Enforcement Network (FinCEN) is one of the US government agencies responsible for combating financial crimes, including money laundering, terrorist financing, and other illicit financial activities. FinCEN also serves as the designated administrator of the Bank Secrecy Act (BSA), which has become one of the main tools in the fight against fraud. Since then, several other laws have improved and modified the BSA to equip law enforcement and regulatory agencies with more effective measures for combating money laundering. The US is also involved in other initiatives, including its membership in the Financial Action Task Force (FATF). FATF sets international AML standards and also plays a crucial role in combating money laundering and terrorist financing worldwide. Which US Financial Regulators Enforce AML Laws? Several financial regulators are responsible for enforcing AML laws in order to combat money laundering and terrorist financing activities within the United States. Some of the main ones involved in AML enforcement include: The Financial Crimes Enforcement Network (FinCEN) FinCen is the primary financial regulator operating under the jurisdiction of the US Department of the Treasury. FinCEN also functions as the financial intelligence unit (FIU), taking on the role of receiving and analyzing information concerning money laundering and terrorist financing.   Additionally, FinCEN delegates its authority to several federal regulators to assist in ensuring compliance with AML laws, including the Federal Deposit Insurance Corporation (FDIC), the Securities and Exchange Commission (SEC), and the National Credit Union Administration (NCUA). The Office of Financial Assets Control (OFAC) It focuses on supervising sanctions programs, ensuring that US companies... --- ### DEXs and KYC: Addressing Compliance Challenges > Decentralized exchanges (DEXs) have been in the talks for quite a while now due to the anonimity and no-KYC policy. But it's about to change. - Published: 2023-10-06 - Modified: 2024-10-21 - URL: https://www.idenfy.com/blog/dexs-and-kyc/ - Categories: Blog Decentralized exchanges (DEXs) are cryptocurrency trading platforms that enable direct transactions between users, aiming to lower transaction fees. They are considered to be fairly anonymous since users need to connect to a crypto wallet to get started. However, DEXs also encounter regulatory hurdles, such as addressing Know Your Customer (KYC) and Anti-Money Laundering (AML) concerns. Read more. Decentralized exchanges (DEXs) currently operate without proper KYC/AML regulations. However, as the regulatory landscape for crypto exchanges has already set its foot, we can clearly expect the same result for DEXs. That’s why many believe that decentralized exchanges need to proactively enhance their KYC compliance measures before getting hit with the wave of regulations. Cryptocurrency exchanges, such as Coinbase, Crypto. com, or Binance, generate revenue using the same model, much like traditional brokerages and stock exchanges. DEXs are a new category of exchanges that seek to push away intermediaries like Coinbase and empower users to conduct transactions directly with one another in a peer-to-peer (P2P) manner. Their goal is pretty simple — to increase transaction speeds and reduce transaction costs. DEXs prioritize customer anonymity and prevent the sharing of personal information with any external parties, including central authorities. That’s why they struggle to identify their customers' true identities, which regulators often see as unacceptable.   Understand in a minute: The absence of a central authority in DEXs also contributes to the level of anonymity they hold. Traditional exchanges are usually centralized and require users to trust the exchange with their funds, which some fear can lead to hacking or misuse.   DEXs operate on blockchain technology and use smart contracts to facilitate P2P trades directly between users, eliminating the need for a middleman. This decentralized nature reduces the risk of funds being held or controlled by a central entity, further enhancing user privacy. These platforms are often automated and autonomous, primarily relying on programming. However, if they fail to meet the necessary compliance standards, they can be vulnerable to security issues. The rapid expansion of DeFi applications, working via smart contracts and decentralized autonomous organizations (DAOs), complicates this matter further. In this blog post, we look into it and explain how DEXs can prepare for the potentially stricter KYC rules in the near future. What is a Decentralized Exchange? A decentralized exchange (DEX) is a peer-to-peer marketplace where users can trade cryptocurrencies directly with one another without relying on an intermediary, such as a bank or a payment processor, to oversee the transfer and custody of funds. This distinction allows DEXs to offer significantly lower transaction fees in comparison to traditional crypto exchange alternatives. Compared to traditional financial transactions, DEXs provide full transparency regarding fund movements and the mechanisms supporting asset exchanges. Since user funds don’t pass through a third-party cryptocurrency wallet during trading, DEXs minimize counterparty risk and contribute to reducing systemic centralization risks within the crypto ecosystem.   DEXs play an important role in decentralized finance (DeFi) by serving as a primary “Lego” building block. This element is what enables the creation of more complex financial products. In general, there are various DEXs out there. Some of the famous examples include SushiSwap, Kyber Network, Balancer, PancakeSwap, and more.   DEXs vs Traditional Crypto Exchanges DEXs are more anonymous compared to traditional cryptocurrency exchanges because of the way they operate. In traditional exchanges, users typically need to complete a... --- ### What is an NFC Tag? A 2025 Guide > NFC tag is an ultimate connectivity tool for communication over radio waves. But in the modern world, this tiny thing holds more power. - Published: 2023-09-27 - Modified: 2025-05-15 - URL: https://www.idenfy.com/blog/what-is-an-nfc-tag/ - Categories: Blog An NFC tag can be programmed with a wide range of information and easily embedded into different products. That’s why there’s no surprise that, with over 80% of smartphones now equipped with NFC, companies are exploring new ways to incorporate NFC technology into their customer experiences. Not too long ago, the concept of paying for groceries with a simple tap of one electronic device to another would have sounded like a science fiction movie. Thanks to near-field communication (NFC) technology and the accompanying smart tags that make it an actual reality. An NFC tag and its reader can establish wireless communication. Typically, the tag contains a certain amount of data, which the tag can transmit to the reader through electromagnetic pulses. These pulses represent 1s and 0s, enabling the reader to interpret the information stored on the tag. An NFC tag is also a more secure alternative for a QR code in short-range applications, such as Apple Pay. Ultimately, the technology involves electronic reader devices that can retrieve data from NFC tags. That’s why NFC is called the ultimate connectivity tool — it enhances the capabilities of various devices, including smartphones, tablets, and payment cards. In this blog post, we’ll explain how you can use an NFC tag in various scenarios, including for identity verification.   What Does an NFC Tag Do? An NFC tag is a small electronic device that stores data and can wirelessly transmit that data to other NFC-enabled devices, typically through a simple touch or close proximity. These tags are used for different purposes, such as information sharing, identity verification, contactless payments, and task automation, making them versatile tools for providing users with convenience. NFC tags also go by various names, including smart tags or info tags. However, their fundamental structure closely resembles RFID tags. Both types contain storage memory, along with a radio chip connected to an antenna.   What is RFID? RFID technology, which stands for Radio-Frequency Identification, is a system that uses radio waves to identify, track, and manage various objects, people, or animals remotely. It has proven to be a successful anti-theft measure for tracking inventory across different industries, including manufacturing, healthcare, automotive, and apparel. RFID systems consist of RFID tags (also known as RFID transponders) and RFID readers. Companies use them wherever there's a requirement to monitor and manage items effectively.   Here's how RFID works: RFID tag. It’s a small electronic device that contains a unique identifier and can store data. RFID tags come in various forms, including labels, cards, or even implanted chips. They can be passive (powered by the RFID reader's radio waves) or active (with their own power source, like a battery). RFID reader. It’s a device that uses radio-frequency signals to communicate with another RFID tag. Readers send out radio waves, and when an RFID tag enters the reader's range, it receives the signal, powers up, and sends its stored data back to the reader. Software. The data from the RFID readers is typically sent to a database or software system for processing and management. This helps companies to track and manage the tagged items, people, or animals efficiently. What is Near-Field Communication (NFC)? Near-Field Communication, or NFC, can be thought of as a blend of RFID and Bluetooth. Unlike RFID, NFC... --- ### What You Should Know About Selfie Identity Verification > Explore the key factors that make selfie identity verification, a KYC process where users take a selfie, a frictionless, yet safe experience. - Published: 2023-09-27 - Modified: 2025-04-02 - URL: https://www.idenfy.com/blog/selfie-identity-verification/ - Categories: Blog Selfie identity verification is the latest ‘it’ trend when it comes to different industries and their top KYC picks. That’s because this verification measure is simple and effective both for the user and for the business, aiming to safeguard its assets. And it’s exactly as it sounds — it requires users to take a selfie, typically during the customer onboarding process. Learn more about its benefits, susceptibility to fraudsters, and more. By 2030, the identity verification market size is expected to reach at least 25 billion US dollars. However, various different verification solutions in the market, it becomes challenging to find the one that actually works in two main ways: it prevents fraud and doesn’t add unnecessary friction to the process. This is where selfie identity verification comes in handy. During this type of Know Your Customer (KYC) process, users take and upload a selfie, a series of selfies, or a video to confirm its liveliness. After that, the IDV software compares it against the photo on the user’s ID document for proper verification. In addition to that, selfie verification has become a beloved solution as a simple way to reauthenticate returning customers.   However, selfies shouldn’t be the one and only measure in your identity verification system. Find out why by reading the blog post.   What is Selfie ID Verification? Selfie identity verification, often known as a selfie check, selfie authentication, or biometric verification, is a user verification method that utilizes biometrics. It involves taking a selfie and uploading it to confirm one's identity. Users capture their selfie images using their smartphones, tablets, or computers, with AI software typically guiding them through the process. This form of identification isn’t completely foolproof, especially on its own. That’s why companies use it as an extra layer of defense against fraudsters by combining it with other verification measures. For example, document verification or database verification. In this scenario, after receiving the selfie from the user, the company can perform a comparison between the selfie and the user’s uploaded ID document or a special government database to ensure that the user is legitimate. This process also helps prevent unauthorized account access by verifying that the account holder matches the ID documents provided. Companies that accept selfies sometimes ask users for multiple pictures. For instance, a profile selfie, a selfie looking to the right, and so on. This extra measure ensures that the user is live and present during the selfie identity verification process. Companies do this to prevent deepfakes, masks, altered photos, and other attempts to pass this security step fraudulently.   What are the Three Components of the Selfie Identity Verification Process? The selfie verification process is based on three main steps, which are: Selfie capture. The user is asked to take a selfie photo or, alternatively, record a short video of their face. Once that’s done, they submit it so that the system can analyze the user’s biometrics. Data analysis. The selfie verification software uses its algorithm to compare the user’s selfie with a reference image (this depends on the particular solution, but either a government-issued ID photo is used or another database). Liveness check. This is an optional step. Liveness detection uses AI to ensure the user is physically present during selfie verification, preventing fraud attempts such as using facial masks or spoofing. The goal is to automatically confirm whether the submitted identity data belongs to a real person. Proper... --- ### Top 5 Use Cases of Biometrics in Banking > Facial recognition, fingerprint, iris scans, and more... These biometrics in banking are just the beginning. Explore the top use cases. - Published: 2023-09-25 - Modified: 2024-10-23 - URL: https://www.idenfy.com/blog/biometrics-in-banking/ - Categories: Blog There are many examples of how biometrics can be used in banking. For example, biometrics can help financial institutions prevent fraud, support regulatory compliance, and provide an alternative way to authentication. That’s why, due to the technology’s convenience, it’s now storming the financial industry, replacing passwords and paving the way to becoming one of the top technological solutions for both KYC and fraud prevention. Read more. Biometrics in banking are more common than some of you might think. Financial institutions have replaced traditional systems with biometrics, such as facial recognition, fingerprint sensors, or voice recognition technology. For Know Your Customer (KYC) verification in particular, biometrics help ensure regulatory compliance, creating a smooth and secure digital identity verification process. What’s special about biometrics is their advantage against passwords. Suh authentication methods based on knowledge, including PINs or OTPs, can be easily stolen or forgotten. In contrast, biometric verification methods, which are the central focus of today’s digital payment systems, enable users to access their accounts using their distinctive biological traits. In this blog post, we take a more in-depth look at this technology, explaining the facial recognition process and the main use cases of biometrics in banking. What are Biometrics in Banking? Biometrics in banking is the use of unique physiological or behavioral characteristics of individuals for authentication and security purposes in digital banking transactions and account access. These characteristics can include facial recognition, voice recognition, fingerprint scans, or retina recognition. Biometric authentication is quickly becoming a fundamental component of the banking industry due to its ability to offer highly secure identity verification processes. Apart from that, biometrics are also used for applications in mobile banking, online banking, ATMs, and even in-branch banking. What is Facial Recognition? Facial recognition is a technology-based method for identifying a person's face by analyzing their facial features. Typically, banks extract this information from a photograph or video. This data is then compared against a database of collected faces to find a matching individual. Facial recognition software leverages technology powered by artificial intelligence (AI). Often, banks use facial recognition technology for their identity verification processes. This is how it works: The software receives a video or an image with a person's face. It scans this data to create a detailed map of the person's features, including precise information about their eyes and other distinctive facial characteristics, such as scars. Based on this comparison, the facial recognition system determines whether the facial map matches anything in its database. Some systems may also determine the customer’s risk score or provide alternative results. For example, Apple first used facial recognition, enabling users to unlock the iPhone X and access their digital wallet. Since then, the company has kept incorporating facial recognition into newer models. According to the big tech company, the likelihood of someone with a random face being able to unlock another person’s phone is approximately one in a million. What is a Biometric Payment? Biometric payment refers to a point-of-sale (POS) technology that’s based on biometric authentication — relying on unique physical characteristics to verify the user's identity and enable the deduction of funds from their bank account. Familiar biometric payment examples include Apple Pay or Google Pay. They allow users to purchase items through Face or Touch ID.   Biometric technology gained recognition in the mid-2000s, particularly in settings such as grocery stores, gas stations, and convenience stores, where it facilitates swift... --- ### What is the Difference Between CIP and KYC? Examples & FAQs > Both CIP and KYC are vital to prevent your business from fraud and stay compliant. However, there are certain requirements that differ. - Published: 2023-09-21 - Modified: 2024-11-11 - URL: https://www.idenfy.com/blog/cip-and-kyc/ - Categories: Blog Customer Identification Program (CIP) and Know Your Customer (KYC) are two different business operations that don’t work the same. However, businesses often confuse these terms when talking about ensuring Anti-Money Laundering (AML) compliance and preventing illegal activity. In this blog post, we'll explain each process in detail, highlighting the key differences to help you create a strong customer identity verification system. What is the difference between CIP and KYC? Customer Identification Program (CIP) and Know Your Customer (KYC) are both processes used to identify individuals based on their activities or information. To verify a customer's identity and ensure they are who they claim to be, companies must gather essential customer information and authenticate it. Companies achieve this by cross-referencing the provided information with authentic and independent identification documents. Understanding CIP and KYC requirements is crucial for businesses to comply with regulations and prevent all kinds of fraudulent activities.   We dig deeper into the differences between CIP and KYC, helping you find out when each process is applied and how to incorporate it into your business based on industry standards. Summary: The definition of CIP, the CIP Rule, and its requirements The definition of KYC and the core KYC compliance requirements  The definition of CDD, CIP due diligence, and the difference between CIP A more in-depth look at the main differences between CIP and KYC Additional info about the CIP verification process and its types Required steps to complete an effective KYC program CIP and KYC with automation What is CIP? A Customer Identification Program (CIP) is a mandatory requirement of the USA Patriot Act, which was introduced in 2003. CIP outlines the minimum measures that financial institutions must take to establish a "reasonable belief” that they know the true identity of each customer.   CIP’s primary objective was to address issues related to money laundering and the financing of terrorism. Currently, this framework mandates that companies must verify their users during the customer onboarding process and later on for ongoing monitoring purposes.   The CIP Rule As per guidance from the Federal Deposit Insurance Corporation (FDIC), the CIP Rule consists of six fundamental elements: Establishment of a written program. Collection of four key pieces of identifying information from customers (their name, date of birth, address, and identification number). Implementation of identity verification procedures. Maintenance of records related to customer identification. Regular comparison of customer information with government lists. Providing customers with appropriate notice regarding the CIP requirements. Companies, even if not legally obligated to establish a CIP program, choose to do so voluntarily due to security advantages. Entities Subject to the CIP Rule The CIP Rule mandates that any business classified as a financial institution under the Bank Secrecy Act (BSA) must comply with its requirements. Some popular examples include banks, lenders, credit unions, brokerage firms, or savings associations, as well as other companies like cryptocurrency exchanges or gambling platforms. Violations of regulations under the BSA, encompassing CIP compliance, can lead to severe penalties or even imprisonment for up to five years.   What is KYC? Know Your Customer (KYC), also referred to as customer due diligence or know your client, involves the verification of the identities of current or future customers and evaluating the potential risks associated with conducting business with them. "KYC" means that financial institutions and other obliged entities must:  Confirm the customer's identity. Understand the nature... --- ### What is Identity Proofing? Complete Security Guide with Examples > Explore what identity proofing is all about and learn the key ways for a frictionless ID verification process while ensuring KYC compliance. - Published: 2023-09-19 - Modified: 2024-11-12 - URL: https://www.idenfy.com/blog/identity-proofing-guide/ - Categories: Blog The Federal Trade Commission (FTC) reported receiving a total of 5.7 million reports related to fraud and identity theft, with 1.4 million of these reports specifically involving identity theft cases. With this level of crime and illicit activity, identity proofing is an inevitable process for businesses that want to protect their assets and their customer’s data. How do you know your customers? Whether a new customer is making a purchase, submitting an application, or engaging in any activity requiring a certain level of authentication, identity proofing comes into play.   Verifying your customers and conducting identity checks isn’t just about compliance and regulations anymore. To prevent fraudulent activities, companies must find an efficient way to confirm that the person interacting on the other side of the screen is indeed who they claim to be. Previously, customers often had to send a physical form of identity documents for verification purposes. However, with artificial intelligence, biometrics, or selfie verification, the process of identity verification and identity proofing has become much more user-centric.   Find out what identity proofing is exactly and how to make this process secure without disrupting the end-user experience.   What is Identity Proofing? Identity proofing is an identity verification process that’s designed to establish the authenticity of an individual's claimed identity in online transactions. The National Institute of Standards and Technology (NIST) describes identity proofing in its Digital Identity Guidelines by providing its two key stages: Claimed identity. This refers to the information a user provides when registering with an Identity and Access Management (IAM) system, essentially who they say they are. Actual identity. This refers to the data that shows the actual authenticity of a user's identity, essentially who they truly are. The overarching objective of identity proofing is to establish a match between a user's claimed identity and their actual identity. It goes beyond traditional authentication measures, such as usernames or passwords. Typically, this process is implemented either during the customer onboarding process or as an additional security layer alongside the traditional verification measures. That’s because using traditional methods, such as knowledge-based questions, isn’t the most secure form of identity proofing. Another person could potentially provide the required information. So, today, we have more robust options — automated identity verification solutions that encompass additional requirements, such as age verification or phone verification.   How Does Identity Proofing Look in Practice? The most popular identity proofing solution in various industries, including financial services, crypto exchanges, and others, like real estate, is document verification. Companies often combine it with biometric measures, such as a video liveness check or a selfie photo verification. This way, they can be assured that the user is really who they claim they are.   Identity proofing is more than collecting personal information from your customers. As a business, you’re responsible for ensuring that the collected data is legitimate. That means you must detect stolen identities and fake documents and deter any type of fraud before giving criminals access to your platform. At the same time, legitimate customers need to be checked in a simple and timely manner.   That’s why, in practice, identity proofing solutions, such as biometric verification, should match customers' expectations by prioritizing a seamless user experience. Businesses who want to stand out in the market choose solutions with: Intuitive interfaces, Clear instructions, and Minimal steps to... --- ### What are the Five Pillars of AML Compliance? > Designated compliance officer, training, independent auditing, and CDD are only a part of the five AML compliance pillars. Learn more. - Published: 2023-09-15 - Modified: 2024-11-12 - URL: https://www.idenfy.com/blog/five-pillars-of-aml-compliance/ - Categories: Blog When establishing a robust AML compliance program, financial institutions must prioritize their ability to identify and assess potential risks. This is particularly crucial when dealing with customers who pose a higher risk of engaging in money laundering. To achieve this, a robust compliance program with the five key AML pillars is required. Over the years, Anti-Money Laundering (AML) initiatives have aimed to increase the difficulty of concealing illicit profits. Despite AML regulations mandating that financial institutions create advanced customer due diligence strategies for evaluating money laundering risks and spotting suspicious transactions, non-compliance cases continue to rise annually. Initially, AML regulations primarily targeted banks and similar entities. However, they have expanded their reach to encompass a wide range of institutions. This includes not only traditional banks but also iGaming platforms or cryptocurrency exchanges.   While various AML guidelines and regulations exist worldwide, AML programs typically consist of five fundamental pillars. We’ll explore what exactly these five pillars are and learn how they can help your organization stay compliant. What is Anti-Money Laundering (AML) Compliance? Anti-money laundering (AML) compliance encompasses a network of laws, regulations, and processes designed to unveil attempts to disguise illegal funds as lawful income. Money laundering is the practice of concealing various criminal activities, spanning from minor tax evasion and drug trafficking to instances of public corruption and the funding of organizations labeled as terrorist entities. The Bank Secrecy Act (BSA) mandates that financial institutions must create AML programs to effectively combat illicit activities. In the UK, the Money Laundering Regulations (MLRS) and in the US, the Anti-Money Laundering Act of 2020 help companies establish comprehensive AML programs with standard guidelines, assisting them in safeguarding both themselves and their customers from crime. 🖇️ Related: AML Compliance Program — Step-By-Step Guide in 2023 What are the Pillars of an AML Compliance Program? While the BSA specifically applies to the United States, the five AML pillars are recognized internationally. That means businesses globally employ them when developing their own AML compliance programs. The five pillars of AML compliance offer a holistic approach, emphasizing internal controls, assigned roles, training and awareness, independent testing, and a risk-based strategy for ongoing Customer Due Diligence (CDD). The five pillars of AML consist of: Designating a compliance officer Completing risk assessments Building internal controls and AML policies  Monitoring and auditing your AML program Performing CDD Below, we’ll review the five pillars of AML compliance in more detail.   1. Designate a Compliance Officer The first step is to find a person in your company who would be responsible for the whole AML program. A designated compliance officer’s duties consist of ensuring compliance and, at the same time, sharing and updating their AML expertise with the whole company. They typically assess existing processes, create new processes, and ensure that the revised strategy aligns with all current AML regulations and is effectively implemented in your company. Other compliance officer duties include: Recommending modifications based on audit findings Training and updating staff members on compliance regulations and changes Communicating these changes to stakeholders and management It’s important that the designated compliance officer has a deep understanding of the industry your company operates. They also serve as the main point of contact for regulatory authorities. 2. Complete Risk Assessments To have a robust AML compliance program, you must establish clear protocols,... --- ### What is a Customer Identification Program (CIP)? > A customer identification program (CIP) requires verifying data provided by your customers. Find the general requirements to stay compliant. - Published: 2023-09-13 - Modified: 2024-11-12 - URL: https://www.idenfy.com/blog/customer-identification-program-cip/ - Categories: Blog As a piece of a broader Know Your Customer (KYC) strategy, companies must conduct Customer Identification Programs (CIP) to establish their customer identities. Any business classified as a financial institution, according to the Bank Secrecy Act (BSA) is required to create a CIP. Learn more about its requirements. The Customer Identification Program (CIP) is a necessary due diligence procedure that financial organizations must complete to fulfill their Know Your Customer (KYC) obligations. The CIP establishes the basic criteria for onboarding new customers. However, businesses are flexible to customize their CIP programs.   CIP aims to detect and prevent illicit activities such as fraud, money laundering, terrorist financing, and other financial crimes. That said, it’s important to note that a CIP is only one component of a more comprehensive KYC program, which also includes customer due diligence (CDD) and ongoing monitoring.   We look into CIP, how it works, and the requirements you must meet to ensure compliance. What is a Customer Identification Program? A Customer Identification Program, or CIP, is a set of measures designed to verify the identity of customers. CIP is a due diligence practice that financial organizations must carry out to meet their Know Your Customer (KYC) compliance obligations. According to the Bank Secrecy Act (BSA), US-based companies and organizations that have business relationships with them, CIP is a mandatory requirement during the customer onboarding process. What is CIP in Banking? A CIP in banking includes all the procedures that banks and other financial institutions must go through to confirm the identities of their customers. The purpose of CIP programs for banks is to ensure the authenticity of customers' identities. In brief, CIPs mandate that financial institutions determine the true identity of every customer when they open an account. Minimal Customer Identification Program (CIP) Requirements The general requirements of the CIP are defined in Section 326 of the USA PATRIOT Act. A Customer Identification Program should be tailored to the company’s size and nature of business and integrated into the firm's anti-money laundering (AML) compliance program.   At the very minimum, your CIP must include the following processes: Identification and verification of any person who applies to open an account. This involves confirming the identity of anyone who wants to open an account with your organization. All CIP programs gather four essential pieces of information from customers, such as their name, address, date of birth, and government-issued identification number. Recordkeeping. This means you have to maintain detailed records of your customers and their account-opening processes. It's crucial for regulatory compliance and helps in monitoring and auditing activities. Comparison with government lists. You must verify the gathered information using a combination of documentary and database verification methods. This involves checking the names of potential customers against government lists or databases, often to identify individuals or entities that might be subject to sanctions or other legal restrictions. Companies should assess the risks associated with their customer base and service offerings based on the specific characteristics of the firm, including its size, location, and customer base. Note: We’ll talk about all CIP requirements in more detail further in the blog post.   What is the Difference Between CIP and KYC? KYC encompasses understanding a customer's identity and the nature of their business activities. In contrast, CIP focuses on... --- ### What are the EU's Anti-Money Laundering Directives (AMLDs)? Complete History Overview > Explore how EU started the AMLDs era, and how its evolving came to cybercrime or “aiding and abetting” considered as money laundering crimes. - Published: 2023-08-30 - Modified: 2024-11-14 - URL: https://www.idenfy.com/blog/eu-anti-money-laundering-directives-amlds/ - Categories: Blog, Regulations by Country EU anti-money laundering directives (AMLDs) require obliged entities — financial institutions and companies that handle transactions in EU member states — to conduct due diligence checks, including identity verification and transaction monitoring, when forming new business relationships. Learn more. All six EU directives were issued by the European Parliament as part of domestic legislation to fight money laundering and terrorist financing. The first directive, referred to as 1AMLD, was introduced in 1991. While it marked a significant advancement in the EU regulatory framework, it suffered from several compliance gaps. To overcome further challenges, over the years, the Parliament has been introducing due diligence laws to establish a consistent regulatory environment for all EU member states. The most recent EU AMLD has elevated the sentence duration for money laundering offenses, establishing a minimum of four years in prison. Additionally, this amendment has incorporated environmental crime and cybercrime into the roster of prohibited activities. Naturally, this puts organizations in a complex position, once again, having to ensure various compliance requirements.   What is an Anti-Money Laundering Directive (AMLD)? An anti-money laundering directive (AMLD) is a regulatory guideline issued by the European Union to establish rules and frameworks for member states to prevent and combat money laundering and terrorist financing activities.   However, since the first directive’s introduction in the 90s, the EU has accelerated the process of implementing new AMLDs. The main reason behind this is the need for new regulatory laws, especially in the complex landscape of financial operations. They now include novel avenues for monetary transactions like non-fungible tokens (NFTs) or cryptocurrency exchanges and iGaming networks.   The most recent AML directive dates back to November 12, 2018. Back then, the European Parliament introduced new regulations to enhance its fraud prevention measures in the ongoing battle against money laundering. This was accomplished through the 6th EU AML Directive (2018/1673), thereby reinforcing the AMLD5. The History of All EU Anti-Money Laundering Directives Europe was prevailing in a political atmosphere that was fostering international collaboration and more engagement towards anti-money laundering due to escalating political anxieties over the narcotics trade. The European Parliament had approved several resolutions advocating for the creation of a worldwide initiative to combat drug trafficking while, at the same time, incorporating measures to prevent money laundering. This narrative resonated with all governments and legislative bodies across member states, resulting in several important factors for the future of EU Anti-Money Laundering Directives: The need for stricter security was recognized on a global level. In December 1988, the United Nations ratified the Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (referred to as the 'Vienna Convention'). In July 1989, the G7 group of prominent industrialized nations, in collaboration with the President of the Commission, established the Financial Action Task Force (FATF) to serve as a worldwide authority in setting standards for anti-money laundering efforts. The European Parliament has enacted six AMLDs in total, with each one building upon and replacing the previous. Let’s take a closer look. The First Money Laundering Directive (1AMLD) The European Council of Ministers approved 1AMLD on June 10, 1991, with member states required to integrate it into their national laws by April 1, 1994. The final national laws and regulations exhibited a... --- ### What is a Risk-Based Approach to AML? > Learn how a risk-based approach (RBA) can complete an AML compliance program, helping assess business risks and customer risk levels easier. - Published: 2023-08-25 - Modified: 2025-02-27 - URL: https://www.idenfy.com/blog/risk-based-approach-to-aml/ - Categories: Blog A Risk-Based Approach, known as RBA, facilitates proactive risk management rather than a post-analysis of a money laundering incident. It’s one of the most used terms in Anti-Money Laundering (AML) compliance. A risk-based approach to AML helps companies focus on preventing money laundering, bribery, corruption, or terrorist financing while taking dynamic precautions against financial crime. Read more. A risk-based approach in AML compliance requires investing in appropriate measures to prevent financial crime. However, companies must decide which processes they want to deploy on their own. That means compliance guidelines have specific frameworks that leave flexibility gaps for companies to choose which KYC and AML measures are best suited to their needs.   To implement a risk-based approach, financial institutions must conduct an anti-money laundering risk assessment for each customer. This leads to developing a customer risk profile, also known as customer risk scoring, which necessitates carrying out customer due diligence (CDD) procedures. Summary:  The definition of a risk-based approach A risk-based approach in the context of AML compliance Different examples of a risk-based approach The benefits of following a risk-based approach Crucial steps for businesses to implement their own RBA What is Anti-Money Laundering (AML) Compliance? Anti-Money Laundering (AML) compliance refers to a regulatory framework that consists of laws and regulations explaining measures that financial institutions and other regulated industries must take to prevent financial crime, such as money laundering.   A risk-based approach to AML compliance requires banks, financial institutions, and other regulated entities to thoroughly evaluate potential risks. This involves gaining a thorough understanding of your customers (this is where KYC comes in) – examining the specifics of their operations, industries, and characteristics, no matter if they are potential or existing clients.   Global Compliance Regulations for a Risk-Based Approach to AML The term risk-based approach to AML was first mentioned in 2020 when presented by the UK Financial Services Authority (FSA), now known as the Financial Conduct Authority (FCA). It was further defined in 2012 by the Financial Action Task Force (FATF) in 2012. Since then, the concept of proactive risk management has been introduced, emphasizing the implementation of appropriate security measures to help effectively manage various crime risks. In general, there are several AML regulatory bodies in different jurisdictions. As a result, businesses must be aware of local and global regulations when ensuring AML compliance. For example, the FATF covers more than 200 countries and jurisdictions. It’s also one of the leading inter-governmental bodies that set new laws and policies to achieve regulatory reforms. Do All Financial Institutions Follow the Same Risk-Based Approach? AML compliance is closely tied to a risk-based approach as it focuses on tailoring measures to effectively mitigate the specific risks a financial institution may face. However, financial institutions have different environments, so a risk-based approach can’t be a standard process that’s identical for all regulated bodies.   As an illustration, let’s imagine that two banks are committed to AML compliance, but their risk-based approaches differ based on their customer profiles and the inherent risks associated with their operations. The first bank can tailor its AML measures to the lower risks it faces, while the second bank can adopt a more rigorous approach due to the higher risks associated with its international trade financing activities. That’s why it’s important to correctly implement processes in your AML compliance program, especially in... --- ### New Account Fraud: Alarming Red Flags and Ways to Fight Back > New account fraud is a dangerous illegal activity, which can result in severe consequences not only for financial institutions. Learn more. - Published: 2023-08-22 - Modified: 2024-11-18 - URL: https://www.idenfy.com/blog/new-account-fraud/ - Categories: Blog New users are great…Unless they turn out to be fraudsters creating accounts only for their devious scams. Yet, companies always search for ways to attract new customers who help them scale and earn profit. But what about protection? We explain how not to get tangled up in the growing threat of new account fraud. Did you use to google if a certain retail store was available to shop online? Ah, the simple times when browsing and actually seeing the items on their shelves were convenient. Now, the concept of convenience has transformed, opening new doors for businesses to sell their products and services in the digital sphere.   Fintech apps, crypto exchanges, NFTs, tokenization, and all the other buzzwords that fall into this category have changed how users think. While some might think balancing security and user experience is another cliche, practice shows otherwise. The rise of AI has come in a bundle with deepfakes, synthetic identities, and a heavy bag of other types of fraud. So having a straightforward onboarding process isn’t enough — it opens a portal for fraudsters to create new accounts and damage your business reputation. That’s why new customers don’t automatically count as a win unless you make sure to create a bulletproof account opening process.   How? We discuss the best ways to detect and prevent new account fraud below.   What is New Account Fraud? New account fraud is a criminal act where an account, like a user profile on an online banking platform, is established using either falsified identification or stolen information. Fraudsters might even blend genuine and counterfeit details, making tracking and preventing the crime complicated.   Fraudsters often use a fake identity to create a new payment card account. This happens either at the banking or the merchant level, with fraudsters using stolen or synthetic identities to secure new credit or debit cards. New account fraud often happens within the first 90 days after the account's creation. Fraudsters start with small deposits in order not to get caught easily. Fraudsters also engage in other criminal activities, which include tactics like social engineering, phishing, or ATO fraud to take out loans, conduct insurance fraud, or engage in illegal black market activities.   What is the Step-By-Step Process of an Account Origination Attack? An account origination attack aims to get the fraudster access to systems, services, or benefits that are typically offered to legitimate users. Often, the credit card account or another type of online account already exists and belongs to another person. The difference between new account fraud is that the account can be created from scratch, whereas here, the fraudster gathers information about the victim, creating a fake identity.   These steps illustrate the process of an account origination attack:  The fraudster collects data about their victim.   They then build a fake identity based on the gathered data conducting identity theft or synthetic identity fraud.   The fraudster finds a bank or another financial institution to set up a new account and gain access to their services. The fraudster is now able to continue their plan to benefit from further crimes, including unauthorized transactions, loan applications, etc. Top 5 Red Flags of New Account Fraud for Financial Institutions Unfortunately, you can lose millions due to new account fraud. While it might appear that... --- ### Case Study: Neobridge > Discover how iDenfy's identity verification, AML screening and PEP/Sanctions checks helped Neobridge save costs on compliance operations. - Published: 2023-08-21 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/neobridge-idenfy-study/ - Categories: Use Cases Find out how Neobridge overcame the challenges linked to traditional banking structure’s compliance requirements and minimized costs by switching to a fully automated KYC/AML workflow. Short Recap Before iDenfy: There were compliance concerns related to decentralized wallets and the real banking payment infrastructure. Traditional financial institutions had their own policies related to enabling bank transfers. It was challenging to meet license requirements, ensure compliance, and handle tax obligations all at once for Neobridge. After iDenfy: Neobridge accelerated their service launch while ensuring complete compliance. Achieved the goal of verifying more customers in less time. Automated the AML screening process with built-in PEP and sanctions checks. The Challenges Neobridge faced some challenges in its operations. Meeting the requirements for licenses, adhering to Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations, and handling tax obligations across various regions demanded careful attention and substantial resources. Additionally, the collaboration with traditional financial institutions to enable bank transfers added another layer of complexity for Neobridge’s team.   The connection between a decentralized wallet and the real banking payment infrastructure created some compliance-related concerns for Neobridge. Neobridge found it challenging to navigate the global environment of compliance requirements and regulations, which vary across jurisdictions for both cryptocurrencies and traditional banking services. The company found that banks typically follow their own compliance standards and risk assessment procedures. Forming partnerships and ensuring that their product aligns with the compliance requirements of banking partners proved to be a time-consuming and intricate process, mainly because banks were not used to dealing with Neobridge’s innovative business model. Neobridge aimed to minimize internal compliance operation workflow and lift the burden by implementing automated KYC/AML software.   Their goal was to: Have a third-party team of experts that would help navigate complex regulatory landscapes. Establish robust AML and KYC procedures. Prioritize security with user experience in mind.   Have more free time to continue fostering banking partnerships. “Launching a product that offers a decentralized IBAN and enables traditional bank transfers from decentralized crypto wallets requires extensive legal and compliance expertise,” said Rimantas Petrauskas, AML officer at Neobridge. “We managed to ensure our product's success and build trust among users with the help of iDenfy’s KYC and AML solutions. ”  The Solution Since launching the project in 2022, the complexities surrounding compliance issues in the integration of a decentralized IBAN and traditional bank transfers with decentralized crypto wallets have delayed Neobridge’s roadmap. To address the complexities involved in achieving the ultimate goal of offering decentralized IBANs, Neobridge adopted a phased approach.   They divided the goal into several sub-steps, which included enabling customers to purchase crypto using credit cards and receive it directly in their decentralized wallet, among others. Despite that, they still needed to find a solution that could automate the KYC process and enable them to focus more on building their own platform and adhering to their roadmap.   In the end, iDenfy played a vital role in assisting the banking and asset management platform to achieve KYC/AML compliance while helping enhance conversion rates. While Neobridge tried out a number of RegTech service providers on the market, iDenfy stood out the most for the following reasons:... --- ### How to Improve KYC Verification? Tips For a Frictionless User Experience > It's one thing to know what KYC verification is, but it's completely another one when it comes to building a frictionless KYC experience. - Published: 2023-08-10 - Modified: 2024-11-18 - URL: https://www.idenfy.com/blog/kyc-verification-tips/ - Categories: Blog KYC verification shouldn’t take multiple steps and more than five minutes. Compliance regulations are getting stricter, at the same time, customers are getting more demanding. Now that not only banking, but sectors like crypto or online gambling are regulated, many consumers don’t want to disclose their identities, not to mention get stuck during a lengthy identity verification process. Read more. Surprisingly, while we live in 2024, banks and financial institutions continue spending millions of dollars every year to onboard and maintain their customers. Recent data reveals that over 1,000 C-level executives across various banks found that, on average, over 50% of them are spending up to 3,000 to complete just one customer KYC check, which is insane, considering how slow some of their internal onboarding processes are.   Let’s not also forget ongoing conflicts between compliance and different risk management approaches or the pace of regulatory changes. Additionally, the mass adoption of artificial intelligence and innovations like ChatGPT don’t help businesses in terms of fraud. Let’s be real. It’s now easier to pre-record a video and bypass KYC verification, especially if the liveness detection software is far from superb. But everything might just seem black or white from a distance. We’re jumping right into the gray side, exploring the benefits of KYC verification checks and spilling the main tactics on how businesses can actually improve their identity verification processes.   What is KYC Verification? KYC (Know Your Customer) verification is a process that businesses and financial institutions use to verify the identity of their customers to prevent fraud, money laundering, and other illegal activities. It involves collecting and verifying personal information about a customer's identity, such as their name, address, date of birth, and government-issued identification. KYC is also an integral part of a larger regulatory framework, which is called Customer Due Diligence (CDD). Part of CDD compliance requires companies to conduct KYC checks. The difference is that CDD goes beyond KYC and involves a more in-depth assessment of a customer's risk profile and potential involvement in financial crimes. When is KYC Verification Required? One of the most popular examples of mandatory KYC verification is in the financial industry. For example, when someone opens a new bank account, the bank will ask for documents like a driver's license or passport to confirm the customer's identity.   Another great example would be cryptocurrency platforms, which now often require users to submit identification documents before they’re allowed to trade digital assets. That’s why today, there are no boundaries for KYC verification. It can be implemented in any industry for security reasons. Other examples of regulated sectors that are required to conduct KYC verification: Art marketplaces Travel businesses Real estate brokers Insurance companies Gaming and gambling operators Non-profit organizations Adult entertainment sites Legal service providers Healthcare platforms In simple terms, a mandatory KYC check means that you have to ask new customers to show you their ID, age, and where they live. They can give you these papers in different ways, like a printed copy or a scanned image. You also need to check if these papers are real, which is a bit trickier when it's done online instead of in person. Top Challenges Related to KYC Verification KYC verification is far from a new concept and has been a critical part of the customer lifecycle. Since everyone wants to save costs and... --- ### What is Watchlist Screening? > Learn how to complete an AML compliance program by building a frictionless watchlist screening flow that scans multiple databases with ease. - Published: 2023-08-03 - Modified: 2025-04-04 - URL: https://www.idenfy.com/blog/watchlist-screening/ - Categories: Blog Watchlist screening is a vital process and a part of the AML compliance program, which mandates financial institutions and other regulated entities to check if their customers and business partners appear in certain databases, including global watchlists, including crime and sanctions lists. Read more. Watchlists consist of people and companies, which are screened against various databases in order to detect high-risk entities. These lists include the Office of Foreign Assets Control (OFAC) sanctions lists, Politically Exposed Person (PEP) lists, and others. By screening these watchlists, organizations can enhance their understanding of users and effectively prevent, detect, and avoid fraudulent activities while carrying out proper Know Your Customer (KYC) and Anti-Money Laundering (AML) processes.   The main concern for businesses is automating watchlist screening and efficiently checking large data volumes. Let’s jump right in and discuss the key steps to building a frictionless watchlist screening process. What is Watchlist Screening? Watchlist screening is the process of checking both individuals and other companies against AML databases, which are maintained by governments, international organizations, and official law enforcement agencies. By screening watchlists, companies can detect and prevent financial crimes like money laundering and terrorist financing.   Watchlists are also sometimes simply referred to as “criminal lists” because they consist of individuals who are linked to all types of fraud. This process is part of AML screening and also consists of screening individuals against politically exposed persons (PEPs) databases and sanctions lists.   ➡️ As a key part of KYC/AML compliance, watchlist screening helps businesses identify high-risk individuals and entities before they decide whether it’s okay for them to start a business relationship.   Related: PEPs and Sanctions Checks Explained What Does Watchlist Data Mean? Since watchlists are official databases, they contain information on high-risk individuals, companies, and organizations. Companies can perform watchlist screening to learn certain details about the entity being screened. For example: Full name Date of birth Natonality Address Email and phone number Photos, fingerprints, and other biometric data Taxpayer ID (TIN or SSN) Criminal record data (including connections to crime) Comprehensive automation solutions use AI to help businesses streamline database screening, including collecting, verifying, and comparing watchlist information. This is beneficial for companies that have a large customer base and can’t risk missing AML red flags or having a backlog that can reduce their scaling efforts.   How Does Watchlist Screening Work? Watchlist screening involves comparing the identities of individuals and entities against various watchlists to identify potential risks or matches with sanctioned or high-risk individuals. These watchlist databases are created and constantly updated by governmental and law enforcement agencies.   For example, a bank performing watchlist screening on a new customer discovers that the person's name partially matches a known individual on the OFAC sanctions list. The bank's system assigns a risk score to this match based on factors like location, transaction history, and other customer data. If the risk score is high, the bank's compliance team investigates further to determine if the individual is indeed the sanctioned person or if it's a false positive. This ensures that innocent individuals with names similar to criminals are not mistakenly blocked or flagged, avoiding false positives. Individuals placed on watchlists are often associated with money laundering and financial crime. These watchlist entries may also involve... --- ### Know Your Patient (KYP): How to Prevent Fraud in Healthcare? > Know Your Patient (KYP) is a term to describe the Know Your Customer (KYC), or identity verification, process in the healthcare sector. - Published: 2023-07-31 - Modified: 2024-11-20 - URL: https://www.idenfy.com/blog/know-your-patient-kyp/ - Categories: Blog KYP is a necessary measure for healthcare professionals when preventing data breaches, drug abuse, medical identity theft, and other fraudulent activities. Most importantly, a properly implemented digital KYP process can help any healthcare organization onboard its patients easily, preventing criminals from using stolen credentials or personal details to access healthcare services. Learn more. What’s great about technology is that patients can now access their medical information online, educating themselves about various health conditions, treatments, and preventive measures. However, once this door was opened, more opportunities were introduced to fraudsters. As a result, medical identity theft has become another alarming aspect of healthcare fraud. What most people don’t realize is that healthcare fraud isn't just limited to street-level criminals. Sophisticated criminal networks and even organized crime groups are involved in large-scale healthcare fraud schemes. They steal patients' personal information to obtain medical services, prescription drugs, or health insurance, leaving innocent victims with heartbreaking consequences. There’s one piece of medicine that helps healthcare professionals prevent such devastating scenarios, and it’s Know Your Patient (KYP).   What is Know Your Patient (KYP)? Know Your Patient (KYP) is a form of patient verification and another name for Know Your Customer (KYC), specially modified to fit the terms in healthcare. The KYP process is used by healthcare professionals to verify and understand the identity and background of their patients, ensuring accurate and secure services. This is especially relevant now that many healthcare organizations have digital registration services and online applications.   Similar to how banks and other financial institutions are mandated to verify the identity of customers when opening accounts to minimize money laundering and other financial crimes, KYP in healthcare ensures that the patient’s identity is legitimate. This way, KYP mitigates the potential for medical identity theft and misuse of personal information. Why is KYP Needed? KYP verification measures play a crucial role in ensuring that pharmacies or hospitals share sensitive medical information, test results, and prescriptions with the rightful patient, not a fraudster. Know Your Patient can also enhance the overall quality and efficiency of healthcare services for patients. For this reason, the KYP process can help organizations overcome these challenges: Onboard all patients remotely Transition existing in-person patients to apps and online platforms Safeguard the healthcare company’s reputation Prevent data breaches and other criminal activities Since providing care for a patient in healthcare involves multiple parties with diverse data requirements, such as hospitals, doctors, pharmacies, government institutions, etc. , using verification in the healthcare industry becomes inevitable. The complexity arises from the fact that one patient with a specific illness can be involved with various entities to ensure comprehensive care. Are KYP Checks Mandatory by Law? Hospitals, pharmacies, laboratories, and other healthcare professionals must conduct KYP checks to mitigate the threat of cyber-attacks and potential data breaches. Such breaches can lead to major data breaches and increase the risk of identity fraud in the future. On top of that, healthcare organizations are obligated to perform KYP checks to comply with the regulatory standards set by their local authorities. Non-compliance can result in severe penalties and sanctions. Keep in mind that KYP requirements for identity verification in healthcare organizations vary by country and region. Here are some examples: United States. In the US, the Health Insurance Portability and Accountability Act (HIPAA) establishes the standards for protecting patients'... --- ### What is AML Screening? > Explore the vital component in every robust AML compliance program, aka AML screening and implement its key practices to stay compliant. - Published: 2023-07-27 - Modified: 2025-04-02 - URL: https://www.idenfy.com/blog/what-is-aml-screening/ - Categories: Blog Rapid technological advancements, inconsistent regulatory frameworks in different jurisdictions, or complexity in the modern financial scope all play crucial roles in one thing — yes, we’re talking about facilitating money laundering. In this context, AML screening, or checking whether potential customers pose risks of money laundering, is vital. Read more. Anti-Money Laundering or AML screening is the process of conducting necessary checks to assess whether customers are at risk of engaging in money laundering activities. It involves verifying their identities and comparing them against relevant watchlists. AML screening is a crucial component of a bigger AML program, which encompasses transaction monitoring, risk management, and reporting of any identified suspicious activities. Together, these elements ensure a robust AML framework that’s able to prevent and detect potential money laundering incidents. Beyond mandatory compliance requirements, screening helps ensure that your business doesn’t become a channel for money laundering and other complex financial crimes, which are getting more complex by the minute. For instance, cryptocurrencies and online banking systems have opened up new avenues for money laundering, as they offer greater anonymity and speed in transferring funds. Let’s not forget offshore banking, complex investment structures, or layered transactions. This complexity can make it difficult for law enforcement agencies to track the true source of funds and identify suspicious patterns effectively. Read more about the process of AML screening and how it can benefit your business.   The Definition of AML Screening AML, or anti-money laundering screening, is the process of going through multiple steps, such as screening PEPs and sanctions lists, global watchlists and conducting adverse media checks, as part of a company’s efforts to conduct a risk-based approach to AML. This means identifying customers who may pose a risk of money laundering by verifying their identities and cross-checking them against these AML databases. ➡️ It is a part of a bigger AML framework, which also includes measures like transaction monitoring, risk assessment, and reporting suspicious activity once it’s detected by filing SARs. What is the Objective of AML Screening? The primary objective of AML screening is to detect and prevent fraudulent activities, including illegal transactions, money laundering, and terrorism financing. This goal can be broken down into three main parts: Conducting risk assessments. The screening process involves evaluating the risk associated with customers and transactions to identify potential suspicious activities and high-risk customers. Avoiding sanctions violations. AML screening helps ensure that transactions comply with international sanctions and regulatory requirements, preventing any inadvertent involvement with sanctioned entities or countries. Protecting against regulatory fines. By implementing effective AML screening measures, businesses and financial institutions can safeguard themselves from potential fines and penalties imposed for non-compliance with AML regulations. Not just sanctions lists but also other wanted lists must be checked during AML screening. High-risk customers are considered to be politically exposed persons (PEPs), which have their own lists due to being exposed to a higher risk of money laundering. PEPs have connections and can be linked to financial crimes, such as bribery and corruption.   So, in general, financial institutions and other regulated industries must conduct AML screening on their customers to 1) determine their risk level and 2) prevent doing business with risky individuals, such as sanctioned entities, PEPs, etc.   When to Conduct AML Screening? Companies conduct AML screening right at the account... --- ### Case Study: GOAT Finance > Learn how GOAT Finance enhanced its KYC process with iDenfy's automated ID verification, minimizing friction and improving the success rate. - Published: 2023-07-26 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/goat-finance-idenfy-study/ - Categories: Use Cases Discover how GOAT Finance improved its AML program with iDenfy's identity verification both for individuals and corporate entities, as well as increased efficiency in their screening and monitoring processes, including building custom rules for government registry checks or adverse media. GOAT Finance encountered the primary challenge of identifying a trustworthy RegTech solution provider that would offer them a real sense of safety, security, cost-effectiveness, and robust features — catering to KYC, KYB and AML needs. The Challenges According to the GOAT Finance team, following regulations is not an easy task. However, the company remains dedicated to complying with both European and global regulations to ensure the safety of its users' crypto investments. Above all, GOAT Finance is driven by its mission to contribute to a safer industry as it pursues its goals. GOAT Finance's compliance procedures consist of a series of steps, such as implementing Know Your Customer (KYC) and Know Your Business (KYB) procedures, verifying the source of funds, implementing AML monitoring systems, and conducting customer risk-scoring. These measures are all aligned with GOAT Finance’s AML policy to ensure a robust and secure environment for its operations. Despite that, GOAT Finance aimed to add an extra layer of security and find the right balance between user convenience and stringent security means. The primary challenges the company encountered involved identifying a dependable KYC provider that would ensure safety, offer good value for money, and provide feature-rich solutions that met its requirements. For GOAT Finance, this was crucial to build customer trust and stay compliant with ever-changing regulations.   To offer its customers a smoother onboarding process while reducing manual work and errors, GOAT Finance needed multiple fully automated fraud prevention solutions, preferably offered by a single RegTech platform.   "We had high expectations for a full-service provider, which means having complete customer control and a customized monitoring system," said Paul Andres Padilla, the CEO of GOAT Finance. Because GOAT Finance’s clientele comprised regulated and licensed institutions, the new KYC/KYB/AML service provider had to meet strict technical specifications, ensure a secure process, and comply with demanding regulatory requirements. Additionally, the automated solution needed to seamlessly integrate with GOAT Finance's back-office system, along with its white-label web and mobile applications. To overcome this challenge, GOAT Finance embraced a comprehensive approach, which included leveraging advanced technology, implementing robust risk management practices, and maintaining constant monitoring and improving its security measures. The Solution In the search for a multi-functional solution that would fulfill the business and regulatory needs of diverse cryptocurrency clients, iDenfy offered to deliver various onboarding solutions, including KYC/AML checks equipped with advanced security technologies, efficient customer and process management tools, all accessible through their user-friendly dashboard. Collaborating with iDenfy provided GOAT Finance with a comprehensive solution for user convenience, security, and regulatory compliance. However, GOAT Finance was particularly impressed with iDenfy’s standout feature, a comprehensive KYB platform that offered automated company document checks, custom questionnaires, and support for identity document verification in various languages. GOAT Finance integrated iDenfy’s full-stack KYC/KYB solutions, leveraging advanced technologies such as facial recognition, document verification, proof of address verification, and AML monitoring. Additionally, they implemented PEP, adverse media, and sanctions screening. This led to faster and more accurate identity verification during customer onboarding and significantly enhanced... --- ### What is Chargeback Fraud? > Chargeback fraud, known as friendly fraud, happens more often than you think. Learn how you can avoid such never-ending dispute claims. - Published: 2023-07-25 - Modified: 2024-11-21 - URL: https://www.idenfy.com/blog/what-is-chargeback-fraud/ - Categories: Blog Chargeback fraud happens if a customer opens a transaction dispute with their payment provider, either for legitimate or fraudulent purposes. While this process is particularly designed to fight crime, businesses, especially e-commerce merchants, have experienced many challenges, with one major issue being substantial financial losses. Find out how to prevent chargeback fraud and identify legitimate chargebacks. If a merchant suspects the chargeback isn’t a genuine one, they have the option to fight back. However, chargeback fraud can be a lengthy and complicated process, leading to more issues than benefits. That’s why some businesses ultimately decide to pay out the chargeback instead.   And let’s not forget the damaged reputation, transaction processing costs, lost shipping, and overall costly fees linked to the fraudulent disputes. So, what exactly can you do to combat chargeback fraud? Tag along and find out.   What are Chargebacks? Chargebacks are reversals of credit or debit card transactions that the cardholders’ bank initiates following their disputes of charges on their bank accounts. That means the customer's credit card company or bank must refund the disputed amount to the customer and debit the same amount from the business's account. This makes chargebacks appealing to bad actors who want to receive refunds and keep their purchased items.   What is Chargeback Fraud? Chargeback fraud, alternatively referred to as friendly fraud, is the process when a consumer uses their own credit card for an online shopping transaction and later asks the issuing bank for a chargeback after already receiving the purchased goods or services. Chargeback fraud occurs when a customer deliberately disputes a charge to obtain a refund.   It can happen for various reasons, usually due to customers: Falsely claiming that they didn’t place the order.   At the same time, chargebacks can be legitimately submitted in several situations. The Fair Credit Billing Act (FCBA) provides support to customers in disputes with creditors, including cases of billing errors, charges for undelivered goods, and unauthorized charges. For businesses, chargeback fraud can lead to certain risks, including financial losses, harmed reputation, loss of customers, increased fees from payment processors, and even potential loss of the ability to accept credit card payments. Examples of Chargeback Fraud Chargeback fraud is damaging for the business because it essentially results in the fraudster obtaining the product or service for free or at a significantly reduced cost while the merchant suffers a financial loss. Here are some examples of chargeback fraud to understand the potential damage caused by different types of chargebacks: 1. Friendly Fraud For example, a customer purchases a laptop online but later claims to their credit card company that they never received the item. The customer disputes the charge, and the card issuer issues a chargeback, refunding the customer's money. However, the customer actually received the device and deliberately filed the chargeback to avoid paying for it. 2. Card Testing Fraudsters often engage in card testing to verify the validity of stolen credit card information. They make small purchases from different online merchants to test if the card details are functional. Once they find a working card, they often proceed to use it for bigger purchases and file chargebacks in order to avoid detection. 3. Exploiting Return Policies For instance, a fraudulent customer buys expensive clothing from an e-commerce store and wears it for a special occasion. After the... --- ### KYC in Online Gaming (iGaming Guide 2025) > KYC in online gaming involves ID verification, source of funds verification, and address verification. Get the latest industry insights. - Published: 2023-07-20 - Modified: 2025-03-02 - URL: https://www.idenfy.com/blog/kyc-in-online-gaming/ - Categories: Blog Online gaming companies are part of the regulated iGaming industry, where there are many strict Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements. Sports betting, online casino, video game or poker betting platforms must verify the user’s identity, their source of funds and location. Learn more. Know Your Customer (KYC) is a vital process that’s used by different industries to establish and validate the identity of their customers. And the online gaming industry is no exception. Here, compliance is a crucial way to prevent money laundering, fraud, and other illicit activities.   Over the past few decades, online gaming (iGaming) and internet-based gambling have been present in various jurisdictions to some extent, the widespread use of digital means has accelerated the iGaming industry on a global level.   Betting on horses and virtual roulette is only a tiny piece of this popular sector. With over one billion people using online gambling sites and apps globally, its popularity continues to increase. Such rapid booming pushed regulators to create stricter laws, which we’ll get right into.   What is Online Gaming (iGaming)? Online gaming, also known as iGaming, is the practice of using the internet to play gambling games, which can take place on mobile apps or websites. While different jurisdictions have slightly legal terms, online gaming is often referred to as online gambling. The main forms of online gaming include: Video game betting (eSports) Casino gaming Sports betting Fantasy sports Online poker The Supreme Court made a significant decision by overturning the Professional and Amateur Sports Protection Act of 1992 (PASPA) in 2018. This law had previously banned sports betting in the US, with only a few states exempted. With the overturning of PASPA, individual states gained the authority to decide whether they wanted to legalize sports betting within their borders. The global online gaming market reached a value of $63. 53 billion in 2022, and experts anticipate steady growth with an annual growth rate of 11. 7% from 2023 to 2030. KYC and AML Regulatory Landscape in iGaming Online gaming companies must verify their users' identity, age, location, and the source of their funds as part of the KYC/AML process. These checks are crucial in preventing fraudulent activities like money laundering and ensuring that gaming services are not being exploited by malicious individuals. However, the gaming landscape didn’t have that many rules years ago. Let’s look at the main laws and regulations applicable to this industry today: The Bank Secrecy Act (BSA) The Bank Secrecy Act of 1970 was the first set of anti-money laundering laws in the United States. It initially targeted traditional financial institutions like banks or credit unions. However, the list kept getting longer, and in 1985, casinos were included in this category, which also extended to online gaming operators.   CTRs and SARs To stay compliant with the BSA, online gaming companies must conduct monitoring, which includes monitoring user activity. Whenever a customer engages in transactions amounting to at least $10,000 within a single business day, the gaming operator must file a currency transaction report (CTR). They must also submit a suspicious activity report (SAR) if any user's actions suggest potential money laundering or other financial activity. Customer Due Diligence (CDD) Online gaming operators must conduct customer due diligence (CDD) processes to... --- ### How Does Age Verification in the Adult Industry Actually Work? > Identity verification, or age verification in particular, is a must when it comes to age-restricted sectors, such as the adult industry. - Published: 2023-07-14 - Modified: 2024-11-22 - URL: https://www.idenfy.com/blog/age-verification-adult-industry/ - Categories: Blog Adult-oriented platforms take up a huge part of the demand for Know Your Customer (KYC) solutions in the entertainment sector. To businesses selling age-restricted items and services, age verification is an effective tool to safeguard minors from accessing NSFW content. Learn more about services that need adult consent and, more specifically, the age verification process. More and more international and local legislations enforce stricter laws regarding age verification requirements in various industries, especially adult entertainment. That means if a business sells age-restricted services to a minor, they are left with legal consequences.   And let’s face it. A very small amount of adult-oriented platforms actually want to implement additional procedures that would potentially result in more friction or fewer users.   So the issue is that it’s not enough to comply with KYC regulations anymore. Adult industry players must now 1) verify users’ ages, 2) be liable in cases of serving adult content to minors, 3) find a way to make the age verification experience as smooth as possible.   If users are required to wait longer than a single minute for any action or response during the age verification process, naturally, they’re more likely to abandon your site and seek out a competitor that offers a more user-friendly experience. Why is it Important to Conduct Age Verification Checks in the Adult Industry? From the expert point of view, it’s also important to integrate age verification policies due to the increasing potential mental health harms of unregulated social media use, especially adult content websites. Legislators are emphasizing the content’s harmful effects on children and teenagers since social media is full of content that shows nudity, bullying, sex trafficking, or addiction. And all the fuss started because the adult industry is now subject to stricter age verification laws to prevent minors from accessing explicit content or engaging in adult-oriented services. But to your surprise (or not), such businesses have a different response, claiming that digital rights and people’s civil liberties can be harmed if there would be strict age verification rules. Additionally, the removal of the well-beloved Internet’s anonymity shield doesn’t make a lot of users happy when it comes to adult platforms.   In general, KYC compliance is designed to contribute to the universal goal of reducing fraud and identity theft. Verifying the identity of customers through reliable document verification and age verification methods helps to weed out fraudulent activities and safeguards against unauthorized access. This protects both the business and the genuine customers, ensuring a secure and trustworthy environment. How does the Age Verification Process Look Like on Adult Platforms? Age verification processes aren’t a new concept in the digital sphere. In the United States, existing laws such as the Children's Online Privacy Protection Act (COPPA) impose specific regulations for individuals under the age of 13. Additionally, nearly all internet users, including platforms like YouTube and Facebook, have encountered the requirement to confirm their age while accessing adult content or signing up for an account at least once in their lifetime.   A decade ago, if we talked about age verification systems, many had age gates in mind. But to this day, age gates typically involve users filling out a basic form where they manually enter their date of birth to confirm their age. This process is used in various online liquor stores, where... --- ### Top 5 Marketplace Fraud Examples You Should Know > Learn the top 5 examples of marketplace fraud, how to avoid getting scammed online, and how to stop fraudsters from damaging your platform. - Published: 2023-07-12 - Modified: 2024-11-26 - URL: https://www.idenfy.com/blog/marketplace-fraud-examples/ - Categories: Blog The popularity of marketplaces is skyrocketing, but with more companies switching to the digital realm, both buyers and sellers encounter new risks related to different types of fraud and scams. So learning about the risks behind anonymity and determining which sellers are legitimate is crucial. Here, we talk more about how to stay safe from marketplace fraud from the buyer’s and the seller’s side. The sad truth is that many online marketplaces don’t prioritize anti-fraud measures until it’s too late or there’s a serious security issue already emerging. On top of that, the issue with fast scaling usually is that businesses don’t invest enough time into implementing proper fraud prevention protocols.   In this article, we’ll discuss what kind of fraud prevention measures marketplaces should use and how customers can avoid scams while browsing online. What is an Online Marketplace? An online marketplace is a digital platform, such as an e-commerce website or app, that brings together buyers and sellers in a single space to facilitate commercial transactions. Unlike a traditional retailer, the marketplace itself does not sell items. Instead, it provides a virtual space where sellers can present their products or services, while buyers can easily browse and make purchases. This arrangement offers convenience and accessibility for buyers, enabling sellers to showcase and sell their offerings to a broader audience. Online marketplaces play a role in facilitating various types of transactions. They can support business-to-customer (B2C) interactions, such as Vinted, as well as business-to-business (B2B) transactions. Consequently, some marketplaces can be two-sided, like Amazon, or one-sided, like Walmart. Other famous marketplaces that you’ve probably heard of are AliExpress, eBay, or Etsy.   What is Marketplace Fraud? Marketplace fraud is a term used to describe various illegal activities that take place within online marketplaces. Marketplace fraud can involve individuals or businesses that engage in fraudulent schemes to exploit and deceive both buyers and sellers or the platform itself. There are different types of deceptive scams on marketplaces, such as fake listings, account takeover, chargeback fraud, or identity theft. What are the main Red Flags for Marketplace Fraud? Whether we like it or not, the most effective way to start preventing fraud is to know how to detect the red flags. That’s why remaining vigilant and using common sense while conducting transactions in online marketplaces is crucial to detect and avoid potential fraud. If you suspect that the person you're interacting with is a fraudster, what signs should you be alert for? Here’s a short list of things that might indicate fraudulent behavior:  The seller has poor reviews. Always make sure to check the feedback and ratings. A high number of negative reviews or suspiciously positive ratings can indicate unreliable sellers. The buyer or seller insists on taking the conversation outside the marketplace. Be very careful if they want to chat through unofficial channels or avoid direct communication within the marketplace's messaging system. This could indicate an attempt to carry out fraud outside the platform's monitoring. The seller asks to pay outside the marketplace payment system. This can be an attempt to bypass security measures and engage in fraudulent transactions. The seller pressures the buyer to make a transaction ASAP. Fraudsters create a sense of urgency or pressure to complete transactions quickly, preventing buyers from thoroughly assessing the legitimacy of the seller or the product. The buyer sends a prepaid shipping label to the seller.... --- ### The Role of AML Requirements for Payment Processors > Anti-Money Laundering (AML) requirements are spreading into many jurisdictions, regulating more payment processors that need to be secured. - Published: 2023-06-30 - Modified: 2024-11-26 - URL: https://www.idenfy.com/blog/aml-requirements-payment-processors/ - Categories: Blog Businesses should always be vigilant, whether it involves screening for sanctions, detecting suspicious account activity, evaluating merchant risk, or monitoring transactions. Thankfully, many of these processes can now be automated, helping payment processors stay compliant with the ever-changing AML requirements. The payment processing industry is best known for its rapid innovation. While it all started with promising technological advancements and evolving consumer expectations, now the modern financial sector has bound us to faster, more secure, and more convenient payment solutions. However, trustworthy transactions and the best possible customer experience aren’t the only challenges businesses face today. Payment processors must align with various Anti-Money Laundering (AML) requirements. That means they must have a clear understanding of the necessary measures to prevent themselves from being exploited for money laundering and other financial crimes. What is a Payment Processor? A payment processor is a service or company that handles the electronic transfer of funds between a buyer and a seller during a financial transaction. PayPal is a famous example of a payment processor.   It enables other businesses to accept credit cards, recurring payments and e-checks without the need to open a separate merchant account. A payment processor handles payment data between the merchants who use them and their financial institutions. A third-party payment processor is also called a gateway that manages the transactions between buyers and sellers.   Third-party payment processors simplify the payment process by handling technical complexities, security measures, and financial transactions. They act as intermediaries between merchants and customers to enable efficient payment transactions.   How Do Third-Party Payment Processors Work? Payment processors operate by acquiring credit or debit card information from a merchant's payment gateway. This information is then verified with the bank to obtain authorization. If the payment is authorized, the payment processor informs the customer’s institution to wire the funds to the merchant’s account.   Here’s how the payment processor works step-by-step: Collecting payment data. When a customer makes a purchase, the payment processor collects the necessary payment information, such as credit card details or bank account numbers. This information is then securely transmitted to the payment processor's system. Authorizing the transaction. The payment processor performs a series of checks and verifications to ensure the validity and security of the transaction. This includes verifying the customer's payment details, conducting fraud prevention checks, and authorizing that the customer has sufficient funds or credit available for the transaction. Wiring the money. Once the transaction is approved, the payment processor transfers the funds from the customer's account to the merchant's account. This transfer can happen in real-time or on a scheduled basis, depending on the payment processor's policies and the payment method used. What’s the Difference Between Third-Party Processors and Merchant Account Providers? Both third-party processors and merchant account providers provide various payment services to businesses. However, there are areas where they have the most significant differences, particularly when it comes to ease of use, integration, access to funds, and rate flexibility. Third-party processors provide more straightforward solutions with pre-existing payment infrastructure. In the meantime, merchant account providers typically offer greater customization options. But different from payment processors, which work as intermediaries, merchant account providers offer dedicated accounts to businesses for processing payments. These accounts are usually established with... --- ### What is the Bank Secrecy Act (BSA)? > Congress set the Bank Secrecy Act (BSA) in 1970, but today it's still a crucial law against money laundering and a way to stay AML-compliant. - Published: 2023-06-29 - Modified: 2024-12-02 - URL: https://www.idenfy.com/blog/what-is-the-bank-secrecy-act/ - Categories: Blog, Regulations by Country One particular requirement of the Bank Secrecy Act (BSA) is that financial institutions are obligated to report cash transactions exceeding $10,000 within a brief period, regardless of whether they occur in single or multiple transactions. Continue reading to gain a better understanding of the BSA and its potential impact on your company. Building an effective anti-money laundering (AML) compliance program is easy on paper. In reality, many financial institutions face challenges when it comes to doing it all: verifying customer identities, developing internal controls, updating policies, and continuously monitoring for suspicious activity.   In this blog post, we take a more detailed look into the Bank Secrecy Act while examining its requirements and discussing key strategies to ensure compliance and prevent fraud. What is the Bank Secrecy Act? The Bank Secrecy Act (BSA) is a crucial US regulation that outlines required record-keeping and reporting practices intended to fight against money laundering. It was first implemented in 1970 but remains one of the key grounds for the global regulatory landscape. It’s also known as the Currency and Foreign Transactions Reporting Act and is sometimes called the anti-money laundering law. The Bank Secrecy Act is developed by the Department of Treasury's Financial Crimes Enforcement Network (FinCEN) and lays out specific conditions that must be reported. The BSA requires institutions to identify and monitor potential money laundering activities and report them to authorities for further investigation and prosecution: Specific BSA/AML compliance program rules: File reports of cash transactions above $10,000. Keep records of cash purchases of negotiable instruments. Report suspicious activity that might signify money laundering, tax evasion, or other crime.   The Bank Secrecy Act has undergone multiple amendments over time to adapt to the changing financial landscape and evolving strategies employed by criminals. Currently, the BSA collaborates with the Patriot Act to combat money laundering and terrorist financing. What is the Primary Objective of the Bank Secrecy Act? The main objective of the Bank Secrecy Act is to prevent financial institutions from engaging in illicit activities, such as becoming channels of money laundering. The BSA regulates banks, lenders, and other financial entities to correspond to the government and report suspicious activity in case of tax evasion and other financial crimes.   FinCEN, the administrative body for the BSA, imposes specific requirements on financial institutions to ensure compliance with its provisions. Senior management in financial institutions must possess a comprehensive understanding of the legislation in order to fulfill their BSA-related requirements effectively. What are the Bank Secrecy Act Requirements? Since the law establishes several requirements that financial institutions must meet, maintaining compliance with the Bank Secrecy Act can be a complex task. The BSA requires financial institutions to implement proper record-keeping policies and ensure that documentation and appropriate information are collected.   In addition, the BSA obliges financial institutions to take action when suspicious activity occurs, including cases involving: Receiving trade or business payments in the form of cash exceeding $10,000. If that happens, filing an IRS Form 8300 is required. Having ownership of one or more foreign bank accounts, mutual funds, or comparable financial accounts. Financial institutions must report these accounts to the IRS annually.   Engaging with a money services business (MSB). According to FinCEN, MSB is any person conducting business, regardless of regularity or organizational structure, and also includes organizations like... --- ### How to Use an Age Verification System? A Guide for Businesses > An age verification system, or an age gate, is a security measure and a part of ID verification (KYC), crucial for various online businesses. - Published: 2023-06-28 - Modified: 2025-05-02 - URL: https://www.idenfy.com/blog/age-verification-system-guide/ - Categories: Blog Are you a business that provides age-restricted services or products? Or perhaps you are someone who wants to understand how an age verification system works. Either way, in this blog post, we’ll provide a clear explanation of how you can verify the age of customers online, comply with regulations, and ensure security in a simple manner. Having an age verification system for some businesses is mandatory. Regulated entities, such as adult-oriented platforms, online gaming sites, or alcohol companies, must check their customers’ age by law. That means they are required to build a customer onboarding flow where users are asked to confirm their age.   We’ll discuss the main methods for verifying age and, later on, get into more details on how to implement an age verification system in practice that both ensures security and a smooth experience for the user.   What is Age Verification? Age verification is a security measure that is designed to check whether the person trying to access services or products is in the appropriate age range, as required by laws or regulations. Companies can verify the customer’s age in person or electronically. Depending on the method, organizations can verify the customer’s age using identity document checks, data records, or biometric checks to see if the person isn’t lying about their date of birth. Most importantly, an age verification system ensures that the company is complying with Know Your Customer (KYC) requirements and follows age restrictions on the services or products they offer. What is an Online Age Verification System? An online age verification system checks the user’s personal identifying information (PII) against various data records and sources, ensuring that they can legally access the wanted services or products. For an age verification system to be effective, it needs to prioritize two key aspects: providing a seamless user experience and ensuring that minors cannot bypass this security measure. Age verification systems can take different forms, such as a simple checkbox where users confirm they are over 18 or more thorough methods like video calls where candidates are asked to show their ID during a job interview. In general, all modern-age verification solutions mainly rely on electronic methods that use artificial intelligence (AI) and facial recognition technology. How is Age Verification Related to Identity Verification? The age verification process is commonly conducted alongside Know Your Customer (KYC) procedures. KYC is a mandatory procedure followed in industries such as FinTech and other regulated sectors when onboarding new customers. In these cases, confirming a person's age is just another aspect of the broader identity verification process. Age verification is a mandatory requirement in industries such as e-commerce, even without KYC compliance. This need arises when businesses sell age-sensitive products and services. While there are situations where identity verification may not be required, it is still the responsibility of companies to ensure that they are interacting with adult customers. What is Age Estimation? Age estimation is a type of age verification process that is considered to be easier on the end-user because it doesn’t require uploading a government-issued ID document. Instead, age estimation software uses AI and machine learning to analyze the person’s face and biometric features; this way, determining if they are over 18, for example. Keep in mind that some jurisdictions and industries don’t consider age estimation a compliant option for a company’s... --- ### A Quick Guide to Simplified Due Diligence (SDD) > Simplified due diligence (SDD) is the lowest level of customer due diligence that you can apply when verifying and onboarding customers. - Published: 2023-06-22 - Modified: 2024-12-12 - URL: https://www.idenfy.com/blog/simplified-due-diligence/ - Categories: Blog Before forming a new business relationship, financial institutions must evaluate what level of due diligence suits the new customer. Whether it’s an account opening process on a financial platform or a potential customer looking to purchase real estate, companies must determine how much risk an individual presents: low, medium, or high risk of money laundering or terrorist financing. Customer due diligence (CDD) is a vital process in building a proper Know Your Customer (KYC) system, and simplified due diligence (SDD) is the lowest level of CDD that’s meant to be employed for low-risk customers. Typically, standard due diligence is applied for low and medium-risk customers, while enhanced due diligence (EDD) suits high-risk customers.   In this article, we'll discuss simplified due diligence, its use cases, and how it compares to full CDD processes like EDD. By the end, you'll have a better understanding of how to establish your own due diligence program. What is Simplified Due Diligence (SDD)? Simplified due diligence (SDD) is a streamlined approach to a more straightforward form of due diligence when the risk for a customer (individual or legal entity), such as money laundering or terrorist financing, is deemed as low or negligible. Compared to other forms of due diligence, the SDD process consists of fewer clicks and is a quicker model of identity verification.   Based on the level of risk associated with customers, different levels of due diligence can be applied. Naturally, customers with lower risk will undergo simplified due diligence (1). Customers with moderate risk will undergo standard due diligence (2), while customers with higher risk will follow enhanced due diligence (3). Simplified Due Diligence Requirements Since it’s the lowest level of due diligence, SDD consists of less intensive methods to gather customer information. However, it shares the same requirements as standard due diligence but with a lower threshold for meeting these requirements. According to the Financial Action Task Force (FATF), simplified due diligence must include: Verifying and identifying all customers Verifying and identifying all beneficial owners (when doing business with companies) Understanding the purpose and nature of the relationship (developing customer risk profiles) Conducting ongoing monitoring Financial institutions have the freedom to build their own SDD protocols. Despite that, if their enforced measures do not align with the mentioned CDD requirements, it can lead to non-compliance and legal penalties.   Simplified Due Diligence vs Customer Due Diligence Simplified due diligence differs from higher-level due diligence approaches in terms of scope. SDD has a narrower focus, primarily collecting information from publicly available sources. In contrast, customer due diligence involves more extensive investigations and in-depth analysis. Another key difference is that SDD is generally used for low-risk transactions.   The simplified due diligence process should align with the lower risk factors. For example, SDD measures may be applied only to some aspects of ongoing monitoring or may be shifted towards the customer acceptance process.   How simplified due diligence measures differ and must include:  Identity verification. Verifying customers and beneficial owners after establishing the business relationship. This is particularly important when the customer’s account transactions exceed a specific threshold.   Data collection. Instead of collecting information or implementing specific measures to understand the nature of the business relationship, SDD involves inferring such details from the type of transaction or business relationship that has been established. Frequency. SDD means reducing the frequency of... --- ### Structuring in Money Laundering Explained > Structuring, or splitting a transaction into smaller sums, is a form of money laundering. With smurfing, they can indicate illegal activity. - Published: 2023-06-20 - Modified: 2024-12-12 - URL: https://www.idenfy.com/blog/structuring-in-money-laundering/ - Categories: Blog Structuring can be a dangerous offense that signals crime. While structuring itself doesn’t always include illegally sourced money, it becomes a serious risk when done with the intention to disguise illicit funds. Join us to explore the key points of structuring in money laundering, its connection to smurfing, and the role of technology in combating fraud. The nature of financial transactions and the potential for significant gains attract bad actors and their devious tactics. That’s why the financial sector is filled with all sorts of crime — starting from bribery or tax evasion and ending in cybercrime or money laundering. Within the realm of these fraudulent crimes, two money laundering techniques stand out: structuring and smurfing. First of all, let’s set these two practices apart.   What is Structuring? Structuring in money laundering is when criminals make transactions intentionally splitting larger amounts into a series of smaller sums to avoid scrutiny from law enforcement or compliance obligations. In other words, criminals strategically structure deposits just under the threshold to prevent unwanted attention. In these cases, the individual or entity typically conducts smaller transactions without requiring the financial institution to file a report with a government agency. For instance, in the United States, a report must be submitted for all cash transactions exceeding $10,000 processed by a financial institution. Such transactions are harder to notice as they do not trigger automated reporting systems. This enables criminals to continuously make regular deposits under the reporting threshold, as they don’t have an obvious pattern for the trigger to be made.   Examples of Structuring Structuring is relatively simple because all the funds typically go into the same account or a small number of accounts under the same name. Despite that, it can backfire if a bank detects a trend of deposits that are all under the reporting limit: For example, John starts by dividing the total amount of cash, let's say $250,000, into smaller portions. Instead of depositing the entire cash at once, he decides to deposit $10,000 at a time over multiple days. By doing so, John aims to prevent getting caught by the bank and regulatory authorities who monitor such transactions. To further complicate the trail of illicit funds, John decides to withdraw the money in a structured manner. Instead of withdrawing the entire amount in one transaction, he makes numerous withdrawals of $2,000 each from various bank branches. By repeatedly making smaller withdrawals, John wants to strategically avoid mandatory reporting thresholds and prevent raising suspicion on his end. Is Structuring a Crime? Even if the person obtained the funds for structuring legally, structuring is still illegal and is considered a criminal offense. Criminals employ structuring in money laundering to avoid anti-money laundering (AML) or counter-terrorist financing (CTF) compliance regulations. They may also create multiple accounts to maintain their “under the radar” status and prevent filing a suspicious activity report (SAR).   Criminals also utilize structuring to conceal how they actually earned the money. Sometimes, individuals use this tactic to avoid tax obligations. Typically, this happens if a person or a high-ranking individual with power and influence receives a monetary bribe. To avoid paying tax on these funds, they make several smaller deposits across multiple accounts. What is the Difference Between Structuring and Smurfing? Even though, in banking jargon, smurfing has a similar meaning as structuring, these... --- ### How to Check if Someone Is Using Your Identity? Identity Theft Prevention Guide > Unfamiliar activity on your credit report, suspicious health insurance records, newly created accounts - sings someone's using your identity. - Published: 2023-06-15 - Modified: 2024-12-13 - URL: https://www.idenfy.com/blog/how-to-check-if-someone-is-using-your-identity/ - Categories: Blog Yes, your identity can be snatched away in a second. While most think the classic motto of “this won’t happen to me” works, the reality in the digital world is different. With identity theft becoming one of the fastest-growing crimes in America and millions becoming victims of identity theft, this dangerous crime happens more often than you think. Identity theft happens when someone exploits your personal information for fraudulent purposes. This crime can occur through stealing your credit card information, obtaining medical services in your name, or using your details to submit a false tax return.   With serious consequences, identity theft remains one of the most dangerous crimes. There’s no secret that there are so many types of identity theft. This fact makes it hard to recognize the signs in case you become a victim yourself.   While criminals wait for the perfect moment to strike, you can take action right away. Check out our identity theft prevention guide and learn the common ways that tell if your identity has been stolen. Summary:  Common identity theft red flags Stages of identity theft Factors explaining how to check if someone’s using your identity  Details of how criminals steal your personal information Things you should do when your identity is stolen What are the Common Red Flags of Identity Theft? One common red flag is unauthorized financial transactions. Keep a close eye on your bank statements, credit card bills, and other financial accounts for any unfamiliar charges or withdrawals, even if they’re small amounts. If you notice purchases you didn't make or withdrawals you didn't recognize, it clearly indicates identity theft. Another red flag to watch out for is receiving unexpected bills or collection notices. If you suddenly start getting bills for services or products you never purchased, it's certainly a cause for concern. Other factors signaling identity theft:  Fraud alerts from online services Receipt of credit cards that you didn’t order  Confirmation emails for accounts that you never created Suspicious login attempts to your social media accounts A sudden drop in your credit rating Declined loan or credit despite clean credit history Fraudsters can use your personal information to open accounts or make purchases, leaving you with the burden of dealing with unfamiliar debts. Don't ignore these signs, even if they seem insignificant. Take them seriously and investigate further to determine if your identity has been compromised. The Main Stages of Identity Theft The overall process of identity theft and recovery typically fits into a consistent three-step pattern. Understanding this blueprint is crucial, as it enables you to detect the warning signs swiftly. Stage 1: Obtaining Personal Data The first stage of identity theft is when criminals steal your personal data. Fraud, phishing scams, data breaches, or hacking are all tools that help thieves collect personal information. Despite that, data breaches remain one of the most popular methods for identity theft.   According to a recent security audit, 2021 was one of the costliest years in terms of data breaches through phishing attacks in the last 17 years. At this point, while the thieves have successfully taken your personal data, they have not yet used it. However, the next stage is actual identity theft.   Stage 2: Using the Stolen Identity The second phase of identity theft entails a series of attempts from thieves. After stealing the data,... --- ### How to Choose the Best KYC Compliance Software in 2025? > As identity verification becomes vital, companies search how to reduce costs and upgrade efficiency through automated KYC compliance software. - Published: 2023-06-09 - Modified: 2025-01-02 - URL: https://www.idenfy.com/blog/kyc-compliance-software/ - Categories: Blog, Identity Verification The size of the KYC compliance software market was USD 9.50 billion in 2022. And there’s no surprise here. The rise in identity theft cases is a key driver behind the increasing demand for identity verification solutions. So the real question is – which one’s the best? We prepared a full checklist to help your business choose the right KYC compliance software. Implementing automated identity verification services is important. However, understanding the key factors and what makes a good KYC compliance software can be challenging. Especially if we talk about industry specifics that must align with your company.   So, when businesses onboard users from different countries, they encounter several challenges, such as detecting fraudsters and ensuring compliance with regulations. Often, especially large-scale businesses that deal with high volumes of data look for automated KYC compliance software. Consequently, this helps them reduce the time-consuming process of identity verification.   Yet, understanding the compliance requirements of each country is the most important hurdle to overcome. Some companies address this challenge by engaging numerous KYC compliance software providers for each operating region as well as to prevent operational crashes in case a vendor faces technical difficulties.   Consequently, this increases KYC compliance costs. That’s why companies that serve clients from multiple countries can opt for a software provider that possesses expertise in global compliance regulations. Additionally, customizable workflows, white-label options, or wide ID document coverage are just a few factors that you want to consider when choosing the best KYC compliance software.   Tag along and find out what metrics, guidelines, and best practices should guide your KYC compliance software decision-making process.   What are the Key Attributes of KYC Compliance Software? KYC compliance software is a tool that helps businesses meet Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations. It can be either conducted on the company's internal servers or provided as a cloud-based service for real-time identity verification.   Typically, the best KYC compliance software means it can offer: A seamless user experience Robust security measures Advanced automation capabilities Comprehensive regulatory compliance Customizable workflows, real-time data verification, and manual KYC customer support also contribute to the unique value proposition of KYC compliance software. By carefully considering such factors as efficiency, accuracy, and compliance readiness, your business can choose the best ID verification provider.   Factors to Consider Before Choosing Your KYC Software Provider Ensure that the software is compatible with your current systems to avoid any integration issues. Check if the KYC software provider offers the option to conduct testing before integration, allowing you to assess its functionality. Consider your budget and the specific features you require, and use these criteria to narrow down your options. Contact the customer support team to gauge their responsiveness and ability to address your concerns. Request a demo of the software to gain a clearer understanding of its functionality and how it aligns with your needs. Companies that don't use the help of a third-party KYC compliance software provider can face severe fines for non-compliance, which sometimes reach millions or even billions in damage. Once this happens, companies can also expect to attract stricter scrutiny from regulatory bodies, including more frequent audits and higher KYC standards. KYC Compliance Software Benefits Integrating KYC compliance software, or digital KYC measures in general, can help businesses: Fight financial fraud. Financial fraud often involves hackers who create fraudulent accounts on gaming... --- ### Case Study: Beera Station > Learn how Beera Station integrated iDenfy's age verification solution and ensured global scaling by onboarding users in less than 60 seconds. - Published: 2023-05-31 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/beera-station-idenfy-study/ - Categories: Use Cases Discover how Beera Station used iDenfy's ID verification solution to build a remote age verification process and transform the onboarding flow through Tappster, an app that now enables age-appropriate customers to buy drinks seamlessly. Through their user-friendly app, Tappster, Beera Station empowers its customers by giving them the freedom to choose and control the type and quantity of beer they desire. Regulators impose stricter laws for digital apps and innovative solutions like Beera Station since they work with alcoholic beverages, and the chances of misusing self-pouring stations are higher. Of course, Beera Station wanted to show effort when ensuring both a smooth and secure beer-pouring experience for age-appropriate customers. That’s why they searched for a proper way to implement an age verification process that would safeguard them from hefty fines and the loss of their license. The Challenges From an ethical perspective, illegal access to age-restricted products or services, such as alcohol or gambling, can result in difficulties for minors, their families, and society as a whole. But aside from protecting minors from its self-pouring beer machines, Beera Station also wanted to integrate a robust solution to the app that could tackle the growing problem of identity fraud. First and foremost, Beera Station needed a fast and simple way to enforce the company’s age requirements for its app users. The company wanted to establish a trusted network that was built on transparency. This approach facilitated audience growth and expansion of the beer stations, aligning with the company's core policy.   Beera Station recognized the importance of compliance with legal requirements and ensuring proper age verification on its Tappster app to provide access to individuals of legal drinking age.   Beera Station’s team set out to take the beer-pouring experience process online, building a secure and seamless journey for its consumers. To enable this experience on the Tappster app, Beera Station needed to start with identity verification. For the unique self-pouring beer station enterprise, that meant fully adhering to Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations. But Beera Station’s goal with age verification wasn’t just based on compliance reasons.   Ensuring that you actually “Know Your Customer” on the other side of the screen posed several challenges for Beera Station:  Beera Station required a reliable age verification solution that could accurately authenticate customers' age and identities, minimizing the risk of fraudulent access or false positives. It was crucial for Beera Station to provide a speedy and user-friendly customer experience while ensuring compliance. The company understood that time-consuming verification could deter Tappster’s users and impact the overall business.   “One of the primary factors beer consumers look for in our services is efficiency, together with a sense of security,” explained Shoval Vishengrad, the co-CEO of Beera Station. “People want to pour their own drink immediately but need to verify their identity and confirm their age. Our age verification process needs to signal trust for all customers. ” The Solution While safety measures are extremely important, sometimes efforts to build trust can deter users from wanting to access the services. To overcome the challenge of fake IDs, Beera Station wanted to support a customer-first culture where beer lovers wouldn’t get frustrated when asked for proof... --- ### PEPs and Sanctions Checks Explained > Learn why businesses integrate onboarding and reputational controls, starting with PEPs and sanctions checks for complete AML compliance. - Published: 2023-05-31 - Modified: 2024-12-17 - URL: https://www.idenfy.com/blog/peps-and-sanctions-checks/ - Categories: Blog Regulated industries must identify PEPs and sanctioned individuals during customer onboarding to comply with KYC and AML requirements. Stay tuned to learn about the intricacies of these risk assessment processes, explore best practices, and safeguard your business from financial and reputational risks. Politically Exposed Persons (PEPs) are people holding a public position with power and influence. Due to their influential status, PEPs are considered at a higher risk of being associated with financial crimes such as corruption, bribery, or money laundering. Sanctions and sanctions lists serve as crucial safeguards against financial crime. They have become a widely used political tool and a security measure in business. Companies use sanctions checks to prevent themselves from getting involved with sanctioned entities. This way, businesses not only avoid the risk of non-compliance fines but also safeguard their reputation in the process. Conducting both PEP and sanction checks is crucial for businesses to minimize the chances of engaging with high-risk individuals or entities and to maintain a robust due diligence process. Keep on reading to learn all about the ins and outs of PEPs and sanctions and how to conduct these checks to ensure compliance. What are Sanctions Checks Meant For? Sanctions checks are the process of screening customers against established sanction lists and watchlists to ensure they are not involved in financial crimes or other illicit activities. These checks are necessary to verify the legitimacy of businesses, individuals, and other entities that your business engages with. 💡 Sanctions checks facts to remember: Sanctions checks help companies meet compliance regulations. Some industries, such as financial institutions, are obliged to integrate sanctions screening policies. While businesses already perform watchlists and adverse media screening, sanctions checks are crucial for identity verification. These checks ensure companies comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements. Sanctions are measures applied to entire countries or, more specifically, targeted at individuals or groups. International organizations and governments design these measures to detect and protect entities from engaging in illicit activities. Governments are also responsible for publishing and updating sanctions lists. What are Sanctions Lists? Sanctions lists are records of businesses, states, countries, or individuals suspected of involvement in some sort of illegal activity. Sanctions lists either act as a tool to prevent criminal activity or can be used for political reasons. The United Nations Security Council (UNSC) initially established sanctions in 1966. Since then, we have used sanctions regimes to safeguard against different threats, such as human rights abuse, global conflicts, or terrorism.   Examples of sanctions lists issued by regulatory bodies: European Commission Office of Financial Assets Control (OFAC) Her Majesty’s Treasury Government of Canada When a person or an entity becomes part of sanctions lists, they face financial penalties, such as fines or asset freezes. Other consequences can range from reduced military aid to a complete travel ban, preventing them from leaving the country. Challenges of Sanctions Checks Companies and their compliance officers often face challenges with sanctions checks due to several factors. In theory, it’s possible for a company’s internal teams to manually review data and scan sanctions lists. That said, this type of sanctions check is inefficient and exposes companies to the risk of starting a business relationship with sanctioned entities. The complexity and frequent changes... --- ### Customer Due Diligence Solutions — How to Build CDD Compliance? > Customer due diligence involves various steps: ID and UBO verification, monitoring, etc. Thankfully, using AI solutions helps simplify CDD. - Published: 2023-05-24 - Modified: 2024-12-18 - URL: https://www.idenfy.com/blog/customer-due-diligence-solutions/ - Categories: Blog Customer due diligence solutions can collect and analyze large data volumes from multiple sources, helping companies more efficiently check ID documents, financial records, and overall online presence. But it all sounds easier than it actually is in practice. Customer due diligence (CDD) enables businesses to assess the risk of engaging in a business relationship and helps prevent fraud, money laundering, and other illicit practices. In simple terms, CDD solutions confirm a client's identity and evaluate the risks they may pose to the business. Customer due diligence checks help companies verify customers and assess their risk profiles. For example, financial institutions must conduct due diligence before granting them access to open an account. This way, companies can make better decisions and protect themselves from legal penalties and financial losses.   Interesting notes to remember: Investing in reliable customer due diligence solutions is essential to building a secure and trustworthy business environment. CDD helps safeguard organizations and builds credibility by helping foster long-term relationships with clients. By effectively managing risks and conducting CDD, businesses can attract new customers, retain existing ones, and gain a competitive edge in the market. But the biggest challenge for companies is to continue the CDD processes after they onboard their customers. Companies must consistently evaluate the risk level posed by each customer. Organizations use customer due diligence solutions and their benefits to achieve this goal. In this article, we go deeper into customer due diligence and share tips on how to check and verify the identity and background of potential business clients and customers through automated solutions. What is Customer Due Diligence in the context of KYC/AML? Customer due diligence is a legal requirement for organizations establishing business relationships with customers. CDD is also part of Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance directives: KYC collects comprehensive customer information to establish their identity and evaluate their suitability for business relationships. KYC refers to customer identification, which is part of AML compliance designed to confirm a customer’s identity. AML aims to prevent illegal activities like money laundering and terrorist financing. AML compliance unites many processes to prevent money laundering, including verifying customers’ identities or monitoring transactions for suspicious activity. That’s why CDD, KYC, and AML are all connected processes that help businesses know and understand their customers better. What Steps Does the CDD Process Include? Customer due diligence is a dynamic process. Consequently, it’s not enough to verify customers’ identities during onboarding. There are certain steps and elements that companies must establish. For example, all data must be stored and updated so regulators can access it easily for audits. Banks and financial institutions should use customer due diligence solutions and include these steps in their CDD process: 1. Identity Establishment Prior to initiating any business relationship, the bank or financial institution in question verifies the identity and business activities of potential customers. This entails collecting and verifying the customer's information. To simplify this element, many companies use automated identity verification software that enables efficient document checks.   2. Customer Risk Level Classification After confirming the customer's identity, the company assesses and classifies the level of risk associated with that customer's relationship and the business. Companies must also securely store this information in a digital... --- ### Account Takeover (ATO): Meaning, Examples, and Fraud Prevention Tactics > Discover the alarming rise of account takeover (ATO) and how it puts the user's or the company's sensitive information at risk. - Published: 2023-05-22 - Modified: 2024-12-19 - URL: https://www.idenfy.com/blog/account-takeover-ato/ - Categories: Blog Account takeover (ATO) remains one of the most popular forms of identity theft and happens when a cybercriminal hacks into another account. In this guide, we'll explore why user accounts are at risk, the techniques hackers use to gain access, and of course, the measures businesses and their users must take to keep all accounts secure. It’s not uncommon for people to have multiple accounts online anymore due to social media, digital banking, online shopping, etc. — to the point that an average person now has at least 100 online accounts. This scale of technology and convenience harms a vital part of security, opening new opportunities for online crime, especially account takeover fraud.   Even though most internet users know the cyber-higiene basics, some tend to dismiss good habits and reuse their login credentials for multiple accounts. That makes it easier for hackers to steal sensitive information and gain access to payment cards. But that’s just the beginning. One thing that all types of fraud have in common is that they can affect both users and businesses. This highlights the importance of understanding and implementing preventive measures to combat account takeover fraud, safeguard personal information, and protect the reputation of businesses. What is Account Takeover (ATO)? Account takeover is a malicious attack and a form of identity theft, which happens when a cybercriminal gains access or — takes over — an online account. It can be anything from an email address or a bank account to a social media profile.   During ATO, cybercriminals exploit stolen credentials and use them to hack into online accounts through phishing, data breaches, social engineering, and other illicit activities. Bad actors also often trade or buy passwords and usernames off the dark web for practically nothing. What is the Impact of Account Takeover on Businesses? Account takeover isn’t a simple or victimless crime. These attacks aim to obtain personal and financial data, which means they aren’t limited to personal accounts. Attackers also target organizations and employ malicious tactics to compromise corporate structures. In severe cases, publicly disclosed ATO incidents can result in significant stock market declines. Account takeover attacks can include installing malware on corporate systems, leading to potential financial losses. Or, if the user whose account was compromised disputes the fraudulent transactions, the company may be held responsible. That’s why ATO can seriously affect any company’s reputation, making it challenging to retain or attract customers and business partners. What happens inside the company when its users are attacked through ATO? This is the typical cycle: Stage 1: ATO attacks also strain internal teams, including support and IT, as they must navigate security issues. Stage 2: Meanwhile, customer requests are storming in as the teams work to assist users in reclaiming their compromised accounts. Stage 3: The finance department must allocate resources to fight chargebacks resulting from fraudulent transactions. Stage 4: The loss of reputation and brand trust leads users to seek alternatives and turn to competitors, resulting in negative consequences of ATO attacks. What are the Risks of an Account Takeover Attack? Account takeover can act as a gateway for more extensive attacks, going far beyond individual user accounts. That’s why ATO provides an initial foothold for criminals to exploit different vulnerabilities and potentially compromise an entire system or network. By gaining control over an account, attackers can use... --- ### Case Study: Mano Bank > See how Mano Bank transformed its customer onboarding process and ditched inconvenient video calls to biometric identity verification. - Published: 2023-05-18 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/manobank-idenfy-study/ - Categories: Use Cases Discover how Mano Bank established a fully automated identity verification process, achieving faster scaling through a customized KYC process that adapts to various user flows. Recognizing the susceptibility to delays and human errors associated with manual verification methods, Mano Bank wanted a new KYC provider who could deliver dependable and efficient services. Harnessing the strengths of both AI-powered software and human expertise in identity verification, Mano Bank wanted to take customer experience to the next level. This required a new Know Your Customer (KYC) software to ensure a smoother and more secure ID verification process that would focus on maintaining both compliance and an efficient KYC workflow. Continue reading to learn more about Mano Bank's and iDenfy's success story. The Challenges Mano Bank combines technology with a cost-efficient strategy to help its clients save time and effort. The bank is exceptional in providing a smooth and personalized experience, working closely with its business partners to enable quick financing decisions and flexible solutions. With AI advancements and increased fraud risks, distinguishing between genuine customers and bad actors is crucial, helping financial institutions avoid regulatory risks or reputational damage. As a financial service provider, Mano Bank must also comply with KYC requirements to identify and verify customers before allowing them to use their services. To achieve this goal, prior to the partnership with iDenfy, Mano Bank employed video calls to onboard their customers remotely. However, the expanding customer base revealed that the video call process was not very convenient: Mano Bank's team had to arrange the time for the call in advance. The calls with clients could only take place during office hours. Mano Bank’s onboarding process wasn’t optimized to accommodate the company's growing customer base. As a result, there was an increasing amount of pressure on its internal team, who had to review each client manually, which drained their capacity. This onboarding process was too much of a hassle for the Mano Bank since it involved a significant amount of staff time that could be better utilized if the process had been automated. The potential to enhance customer onboarding prompted the search for automated KYC solutions. Like many fintech players, Mano Bank was heavily influenced to switch to digital identity verification solutions during the global COVID-19 pandemic due to the inability to conduct in-person verification because of the lockdown restrictions. "iDenfy's solution became highly relevant for us during the pandemic, as customers were no longer able to visit physical branches and complete the required paperwork on-site with assistance from staff,” commented Giedrė Blazgienė, CEO of Mano Bank.   The Solution Mano Bank recognized the importance of enhancing the efficiency and accuracy of its onboarding process while also improving the overall experience for its customers. Additionally, the financial service provider had to ensure that they improved the speed of their onboarding process without compromising on the verification approval rates. Mano Bank was seeking a partner that could assist them in building frictionless experiences with fast ID verification checks for their customers, ensuring that they could be onboarded without any delays. That’s why Mano Bank looked for an easily integrated solution, minimizing the need for extensive engineering resources.... --- ### Document Verification: How Does the Process Work? > Document verification tells if a document is authentic or not. That's why many businesses use it for fraud prevention and KYC/AML compliance. - Published: 2023-05-10 - Modified: 2024-12-19 - URL: https://www.idenfy.com/blog/document-verification-process/ - Categories: Blog, Identity Verification Collection, extraction, validation and verification. These are the vital steps of the document verification process. But what else goes into deciding whether a document, such as a bank statement or an employment record, is actually legitimate or not? We go deeper into this subject, discussing the benefits of online document verification. Government agencies, financial institutions, and businesses use document verification to confirm the authenticity and validity of a document. This process helps to ensure that the document is genuine and has not been tampered with, altered, or counterfeited in any way. Document verification is also a crucial step in the customer onboarding process. It allows companies to quickly and securely verify the authenticity of identity documents provided by new customers. By using document verification and other security methods, businesses can enhance their verification processes, ensuring that only legitimate customers are onboarded. Although the task of onboarding customers may seem straightforward, businesses actually face multiple challenges in the process. They must balance the need to mitigate fraud, build customer loyalty, and comply with regulatory requirements, all while ensuring a fast and secure onboarding experience for their customers. How to achieve this major goal? One way is to incorporate document verification. To find out more, keep on reading.   What is Document Verification? Document verification is the process of checking the authenticity of a document, such as a passport, driver's license, or ID card. This process is essential for businesses that deal with money flow and high-value transactions. That means financial institutions, such as banks or cryptocurrency platforms, must verify documents to find out who their customers are and who they are conducting business with. Typically, companies conduct document verification by examining the document’s physical and digital features, including its format, security features, and other details, such as the machine-readable zone (MRZ). The document verification process involves these stages:  The customer wants to create a new account. They prove their personal data as part of the account opening process. Typically, the data includes the name, date of birth, address, etc.   The customer additionally provides documents for verification. For instance, they may be asked to send a birth certificate to prove their age or include a utility bill for a form of address verification. The organization checks the provided details. They compare the sent details with the provided document to check if it’s authentic and not forged in any way. The organization decides if the document can be verified. If the verification is completed successfully, and the document appears to be authentic, then the customer is deemed as legitimate. Why is Document Verification Important? Document verification is critical in identifying document forgery and preventing fraud. Without proper authentication, fraudsters can easily open an account using fabricated or stolen information. By validating documents, companies can ensure that the information users provide is accurate and legitimate. This way, organizations reduce the risk of fraud and ensure their operations are secure.   By verifying documents such as ID cards, passports, and other official documents, companies can ensure that the person presenting the info is who they claim to be. Document verification is also essential in various industries, such as fintech, gaming, or transportation, where sensitive information is at risk. Other examples include: Financial institutions. They use document verification to ensure that customers are who they claim... --- ### Case Study: June > Discover how iDenfy helped June and 500+ businesses reduce customer onboarding time and minimize costs with full-stack identity verification. - Published: 2023-05-05 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/june-idenfy-study/ - Categories: Use Cases Find out how June increased its application conversion rates in problem regions and reduced average applicant verification time while maintaining the same high-quality user experience and KYC compliance standards. June strongly believes that the process of finding housing should be an instant experience for their customers. However, before iDenfy, the manual procedures that the platform had in place posed a significant challenge to June’s ability to review all customers' applications in a timely and secure manner, especially during high season. Continue reading how June managed to overcome these challenges with iDenfy’s implementation. The Challenges June is committed to providing exceptional service to its residents and owners. The company's 24/7 support team assists residents in resolving maintenance issues promptly. Consequently, the rental platform aims to deliver a level of service that surpasses expectations and sets a new standard in the residential rental industry. A huge part of an exceptional customer experience for June is ensuring security during the application review process. But as a fast-growing housing company, before iDenfy, June had already received thousands of applications from potential customers interested in renting. The original applicant verification process at June was conducted manually, with the back-office team in Greece analyzing photos of documents.   This approach was both time-consuming and challenging for June, as they had to ensure an efficient authentication workflow while maintaining data accuracy. As a result, June's team noticed an increase in costs associated with the manual verification process as the company scaled up.   “We strongly believe that the process of finding housing should be an instant experience for our customers. However, the manual verification process posed a significant challenge, especially during high season,” said Daniil Sigal, Director of Product at June. “That’s why we looked for new automated ways to improve our applicant onboarding process so that we could operate at scale while providing our customers with a seamless experience. ” June also found it challenging to maintain the same high-quality standard of checks when conducting everything manually. This included detecting fake or expired documents, capturing personal data like the applicant's full name and address, and verifying that the applicant is a real human. The Solution June aimed to review its customers' applications in a more timely and secure manner. So the ultimate goal was to ensure a smooth customer onboarding experience and lift the burden of reviewing thousands of applications manually. To accomplish the goal of automating the applicant verification process, June conducted research and compiled a list of potential AI-powered ID verification options. June’s team compared the solutions based on their features, user experience, and integration complexity.   Based on these criteria and to address the challenges behind manual applicant authentication, June made the decision to implement iDenfy’s full-stack ID verification solution as the first step of the new tenant application process. June chose iDenfy as the preferred solution due to its technical documentation, flexibility, and overall positive end-user experience. The decision was based on iDenfy’s fraud detection accuracy, which includes liveness detection and facial recognition technology, particularly useful for detecting fraudulent attempts to pass verification, including deepfakes and masks. At the same time, automating identity verification checks meant higher sign-up conversion rates and... --- ### Corporate KYC: How to Verify and Onboard Businesses > Learn how corporate KYC goes beyond verifying people to verifying the legitimacy of a whole business. Discover how it benefits the B2B field. - Published: 2023-05-03 - Modified: 2024-12-20 - URL: https://www.idenfy.com/blog/corporate-kyc-business-verification/ - Categories: Blog Corporate KYC refers to the verification process of businesses and related individuals to ensure regulatory compliance. Although financial institutions are the only organizations required to perform corporate KYC, any company can benefit from it, especially those that provide services to other businesses. While standard Know Your Customer (KYC) focuses on verifying individuals, corporate KYC goes a step further by verifying businesses' legitimacy. And there’s a great reason for that. Due to the rising threat of fraud, it’s no longer sufficient to depend only on verifying individuals interested in purchasing your service. KYC measures have been a part of Anti-Money Laundering (AML) regulations for some time now. In practice, during KYC, the user must complete KYC before establishing any working relationship with a financial institution. So to effectively safeguard your business, meet legal requirements, and mitigate fraud risks, it’s necessary to know how to authenticate every company you start a business relationship with. This process is called corporate KYC or Know Your Business (KYB). What is Corporate KYC? Corporate KYC is an identity verification measure that authenticates the legitimacy of a business and its owners before they can open an account with a financial institution. According to AML regulations, obligated entities must undergo Politically Exposed Persons (PEPs) and sanctions screening processes during a company check. The main elements of the corporate KYC process are: Customer identity verification Customer due diligence (CDD) Ongoing monitoring While financial institutions and related businesses such as fintech or cryptocurrency companies are legally required to perform corporate KYC, any company can use such background checks as a way to ensure security and build a more robust risk management strategy. Why does Corporate KYC Matter? Corporate KYC is crucial because it helps companies verify the identities of their clients, especially other corporations. It's an integral part of the onboarding process, where a company takes measures to prevent fraud and detect any risks associated with another company or customer. Moreover, the evolving regulatory landscape is increasing the demand for corporate KYC compliance. As more processes come under the AML scrutiny and penalties become more severe, alongside customers' growing concerns for data privacy, companies must also ensure the safety and security of their B2B relationships. When was Corporate KYC Established? Regarding compliance, the Corporate KYC term is relatively new, especially compared to the more established practice of conducting customer KYC identity checks. For many years, there was a security gap because of the lack of AML measures dedicated to business relationships. To fight the infiltration of Pablo Escobar's drug enterprise into the global banking system, G7 presented the Financial Action Task Force (FATF) in 1989. And after the 9/11 attack, the FATF expanded its agenda to include anti-terrorist funding, which safeguards the global financial system from criminal activity. Fast-forward to 2016, the US Financial Crimes Enforcement Network (FinCEN) introduced new regulations under the CDD rules to combat this issue further, requiring any company engaging in business with another business to follow a standardized process of verifying the legitimacy of another company. This is known as corporate KYC or KYB. Before more rigorous regulations, criminals exploited this loophole by setting up shell companies to conceal their identities. As business records were only superficially reviewed, fraudsters could launder money, finance terrorism and commit other... --- ### KYC Onboarding: How to Achieve Complete Compliance? > Check out insights on the importance of KYC onboarding, best practices, and how to streamline the process for a seamless customer experience. - Published: 2023-04-27 - Modified: 2025-04-02 - URL: https://www.idenfy.com/blog/kyc-onboarding/ - Categories: Blog The KYC onboarding process is crucial for any company that wants to ensure customer trust and credibility. Companies must build an efficient and seamless onboarding to create a positive customer experience from the beginning, setting the tone for the entire customer relationship. A complicated or time-consuming KYC onboarding process can frustrate potential customers and discourage them from doing business with the company. Onboarding is not only the first impression that customers get, but it’s also an essential process to protect both the company and its customers from fraud and other illegal activities. But what exactly is KYC onboarding? The KYC onboarding process refers to the customer due diligence (CDD) process that financial institutions and other regulated entities must complete before accepting a new customer. Businesses can prevent fraudulent transactions and protect themselves from legal and financial repercussions by verifying the identities of their customers and ensuring their authenticity. However, the challenge lies in creating an efficient and seamless onboarding process while also complying with Anti-Money Laundering (AML) regulations. To learn more about how to achieve both goals, continue reading. What is KYC Onboarding? KYC onboarding involves the necessary procedures that a company must follow to verify a customer's identity and assess their risk level. The onboarding procedures must be completed before giving the new customer access to any product or service provided by the business. To onboard a customer in a compliant manner, companies need to collect two types of documents, which consist of identity proof (a government-issued ID, such as a driver’s license) and proof of address (PoA) (such as a tax bill). The KYC flow depends on the industry, but a common approach is to verify at least two data points for compliance and accuracy. For example, a crypto platform always asks its customers for a PoA to activate their wallet. Loan service providers ask for proof of income, etc. This goes along with the standard document check or a database check (cross-checking onboarding data with a government registry or another official data source). What Kind of Data Needs to Be Collected for KYC Onboarding? At a minimum, companies must obtain the following set of data during customer onboarding: Full name Date of birth Address As one of the steps in the KYC onboarding process, companies may also require specific data points that are linked to the jurisdiction in which they operate. For example, customers in the US may be asked to provide their social security number, while clients in the UK may be asked to provide their national insurance number. After obtaining the required information from a customer, the company must verify the accuracy of the data to confirm that the person who provided it is indeed the rightful owner. Adhering to Anti-Money Laundering (AML) compliance necessitates this process. It typically involves requesting the individual to provide a government-issued ID document (which is the document verification part) and a selfie (as a biometric check). As an alternative, companies can ask their customers to provide the mentioned PoA, and so on. KYC Onboarding and its Relation to AML KYC procedures play a critical role in combating financial crime, such as money laundering, corruption, or terrorist financing. That is why KYC procedures are an integral part of a bigger AML framework,... --- ### What is the Difference Between CDD and EDD? > Looking to understand the difference between CDD and EDD? Learn how to mitigate financial crime risks with a robust compliance program. - Published: 2023-04-25 - Modified: 2024-12-30 - URL: https://www.idenfy.com/blog/cdd-and-edd/ - Categories: Blog Businesses perform different levels of Know Your Customer (KYC) processes on their customers, namely Customer Due Diligence (CDD) and Enhanced Due Diligence (EDD). To understand CDD and EDD better, we’ll discuss the differences and key aspects of how to ensure proper compliance for low-risk and high-risk customers. CDD and EDD requirements are designed for various industries and aren’t limited to financial companies. Industries must comply with the requirements to avoid anti-money laundering (AML) fines and other penalties, such as revocations or license suspensions. So what, exactly, is enhanced due diligence, and how does it compare against the CDD procedures for low-risk customers? Keep on reading to find out more about the process of conducting EDD checks and how it fits into a larger picture of KYC and AML compliance.   CDD vs EDD The main difference between CDD and EDD is that CDD is applied to all customers, while EDD is reserved for high-risk customers who require further scrutiny. Regulated entities are required to know who they have a business relationship with. For this reason, businesses that aim to meet CDD and EDD compliance requirements typically conduct KYC checks. KYC encompasses not only CDD but also customer identity verification and continuous monitoring. Similarly, EDD is just one aspect of CDD. Identity verification is typically requested at account opening and to enable high-risk transactions. When a customer is deemed low risk, they may only undergo Simplified Customer Due Diligence. This means the only requirement is to identify the customer without verifying their identity. What is Customer Due Diligence (CDD)? Customer due diligence (CDD) is a series of KYC procedures intended to evaluate customer risk. In practical terms, CDD entails obtaining personal details about customers, including their name, birth date, physical address, and other relevant data. Typical CDD processes include the following steps:  Identifying and verifying all clients or customers Understanding the purpose of customer relationships to develop risk profiles Conducting ongoing monitoring to detect and report suspicious activity Moreover, it’s necessary to perform CDD during high-risk transactions, such as those involving large amounts of money or those linked to other high-risk individuals, businesses, or locations. Keep in mind that CDD regulations vary depending on the jurisdiction in which the business operates. This means that companies need to comply with the specific requirements of the jurisdiction they operate in, which could lead to differences in the CDD process. Here are a few examples: In the United States, the Financial Crimes Enforcement Network (FinCEN) has established specific requirements for CDD as part of the Bank Secrecy Act (BSA). Similarly, the European Union has introduced the Fifth Anti-Money Laundering Directive (5AMLD), which outlines specific CDD requirements for all EU member states. What is Enhanced Due Diligence (EDD)? Enhanced due diligence (EDD) is a set of procedures businesses follow when a person or transaction is assessed to have a greater risk of being involved in money laundering or other financial crimes. In essence, EDD involves a set of steps that are typically more extensive and thorough than the initial due diligence process. The basic measures include:  Adopting a risk-based approach to identify customers or users that require further investigation. Gathering additional documentation and performing more thorough KYC and AML checks to confirm the user's identity and verify their activities. Deciding on the... --- ### E-commerce Fraud: Guide to Preventing Money Laundering with Identity Verification > Learn the key factors about e-commerce fraud to protect your business and customers from potential legal and reputational damage effectively. - Published: 2023-04-21 - Modified: 2024-12-31 - URL: https://www.idenfy.com/blog/e-commerce-fraud/ - Categories: Blog Amazon, eBay, AliExpress. These are just a few of the household names that have been ruling the e-commerce world. While e-commerce has been successful in providing convenience to customers, it also poses challenges for businesses, such as fraud and money laundering. If left uncontrolled, e-commerce brands can face revenue loss and other major consequences. The success of e-commerce businesses can be attributed to their ability to provide a more efficient and convenient way to buy and sell products. This is not surprising, given the increasing urbanization, internet usage, and integration of e-commerce platforms with devices like smartphones, all fueling this market's growth. But a single bad experience on an e-commerce platform can cause buyers and sellers to lose trust and look for other platforms to conduct their business. So it’s important to understand how e-commerce businesses are challenged by fraudsters. While criminals use different types of scams to attack e-commerce sites, identity theft remains the most common type of fraud in this sector, causing significant losses for customers and merchants yearly. In this article, we talk about fraud prevention and provide detailed steps on how to safeguard your e-commerce business with such tools as Know Your Customer (KYC) or Know Your Business (KYB) verification.   Key topics:  Fraud in E-Commerce Money Laundering in E-Commerce Red Flags Indicating Fraud  Consequences of Inaction  AML Compliance  Fraud Prevention Measures for E-Commerce What Is E-Commerce Fraud? E-commerce fraud refers to any fraudulent activity that takes place during online transactions involving e-commerce platforms. It involves both buyers and sellers and can include a range of tactics, including identity theft, payment fraud, and chargebacks.   E-commerce fraud can cause significant losses for both customers and merchants and can lead to the loss of trust in online marketplaces. Below, we go deeper into the main types of fraud in e-commerce.   Identity Theft Identity theft happens when a fraudster steals a person's identity information to make fraudulent purchases or transactions. Typically, the criminal obtains this information through phishing scams, hacking, or by purchasing it on the dark web. Once they access the victim's details, they can use them to open new accounts, make purchases, or commit other fraudulent activities. In the famous words of the notorious hacker Ngo Minh Hieu, who had stolen personal data from over 60% of Americans – “when a person loses their identity, they lose it forever. ” Payment Fraud Another type of e-commerce fraud is payment fraud, where a cybercriminal uses stolen payment information or creates fake payment details to complete a purchase. For example, a fraudster may use a stolen credit card number to make a purchase or create a fake bank account or payment gateway to trick the seller into accepting the payment. Chargeback Fraud Known as friendly fraud, chargebacks are also a common form of e-commerce fraud, where a customer disputes a charge with their bank or credit card company, claiming that they didn’t authorize the transaction or that the product was not delivered as promised. To prevent double refunds, some e-commerce marketplaces may ask their users to close the dispute they opened and work with their bank to resolve the issue instead of making fraudulent chargeback claims. Case study: Learn how iDenfy’s identity verification service helped The Everset reduce fraudulent accounts by 83%.   How Does Money Laundering Happen in E-Commerce? Money... --- ### Case Study: Residenture > Check out the testimonial from Residenture to see how iDenfy's KYC solution helped build a fully automated customer onboarding from scratch. - Published: 2023-04-18 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/residenture-idenfy-study/ - Categories: Use Cases Check out what steps Residenture took to build a fully automated onboarding flow, seamlessly verifying all auction participants and confirming that they have a residence permit in Switzerland. As a startup aiming to modernize the real estate industry, Residenture’s top priority is to establish trust and credibility. The same principle applies to verifying their buyers. According to Residenture, with Know Your Customer (KYC) verification, their goal was to avoid manual processes and prevent issues like delays. Keep on reading how they managed to prioritize efficiency and reliability with iDenfy’s help. The Challenges Residenture has introduced a fully automated and flexible property auction model that operates in real-time, setting them apart in the real estate industry. This innovative approach has disrupted traditional practices in the market. Naturally, Residenture needed to keep the same approach towards its KYC process. However, its distinctive service offering poses unique risk-related challenges. For this reason, Residenture searched for an AI-powered identity verification solution to continue its digitization and transparency to the Swiss and the European real estate landscape.   Residenture had to make sure that everyone involved in the transaction was a real person and had a residence permit in Switzerland.   Without this essential security step, the auction could end with the highest bidder, who might not be eligible to purchase the property due to legal restrictions. That meant such auctions would have no meaning and lose their purpose on the platform, while Residenture would lose its credibility as a service provider.   “Before partnering with iDenfy, we considered manual document verification or notary services as valid options. However, our aim was to create a modern, fully digital process,” said Armin Topic, the Co-Founder of Residenture. “To achieve this, we strived to automate the verification process as much as possible while also providing users with a self-service auction experience. " The Solution Residenture placed a high priority on customer experience, always seeking to strike a balance between providing a secure service and a smooth real estate auction experience. Through initial research, Residenture found that manual KYC processes are lengthier and more costly. Without an AI-powered ID verification solution like iDenfy, Residenture would have to either take a risk and trust that all users have the legal right to purchase real estate in Switzerland or find a way to perform verification manually. Both of these options did not match Residenture’s expectations. Residenture recognized this obligation and saw iDenfy's solution as the best fit to enhance the platform through automation.   To achieve this goal, the real estate company enlisted the help of iDenfy to assist in detecting illegitimate platform users automatically. The decision to avoid manual KYC was based on the following reasons: Human error risks. Manual verification methods can lead to unsuccessful auctions for the platform. Potential negative impact. Manual IDV methods can increase reputational risks and harm Residenture’s brand. Competitive edge. Residenture’s goal was to modernize the real estate market and increase service efficiency through automated tools.   Building trust. Residenture recognized iDenfy as an extra layer of security, helping the brand build trust and credibility.   As a new startup, Residenture needed to craft its KYC system from scratch. To do... --- ### DAC7 Directive: How Online Marketplaces Should Collect, Verify, and Report Their Data > The EU's DAC7 Directive has enforced stricter obligations for various digital platforms with the need to collect, verify and report data. - Published: 2023-04-11 - Modified: 2024-12-31 - URL: https://www.idenfy.com/blog/dac7-directive/ - Categories: Blog In this article, we share the essentials about what the new regulation, DAC7, is and how it affects online marketplaces. Learn more about the EU tax transparency rules and prepare your business for the changes. Businesses seek to reach their customers’ demands while regulators try to find new ways to ensure fair tax practices.  Correspondingly, the European Commission presented a new tax directive – DAC7. The directive came into effect on January 1st, 2023. Despite that, the newest EU tax directive brings new challenges to online marketplaces.   Continue reading the article to find out: What is DAC7?   Who needs to comply with DAC7? What kind of data do you need to collect, verify and report? How to prepare for DAC7 changes? FAQs What is DAC7? Directive 2021/514, approved by the EU Council last year, better known as DAC7 regulation, is an EU tax directive that defines new obligations for digital marketplace operators. DAC7 requires digital platforms to report seller revenues along with business and personal information to tax authorities yearly.   DAC7 was created with the intention of promoting tax transparency and ensuring that no taxes are left unreported.   According to DAC7, digital platforms are defined as software that enables sellers to connect with buyers. This encompasses various activities, including digital platforms like food delivery apps or car rentals.   What are DAC7 Requirements? Platform operators who are tax residents in an EU member state must submit their filings to the tax authority of that specific state. The new rules are set to impact both EU-resident digital platform operators and non-EU, foreign digital platform operators. The data reporting obligations of the DAC7 regulation apply to: Digital platform operators that are tax-resident or established in the EU. They can be established either by incorporation or permanent establishment. Foreign platform operators that are involved in commercial activities in the EU but do not have any tax or legal presence in the EU. In light of the implementation of DAC7, every marketplace founder must examine how it affects their reporting obligations. Neglecting to report can result in penalties for the marketplace.   Who is Affected by DAC7? It’s important to note that even if a company is not based in the EU, they still have to comply with the reporting obligation if they operate in or have sellers in EU member states. The obligation of DAC7 applies to various digital marketplaces: Sales of goods. For example, eBay or Amazon. Rental of immovable property. For example, Booking. com or Airbnb. Carrying out personal services. For example, TaskRabbit or Uber. Rental of any mode of transport. For example, Click & Boat or Turo. According to DAC7 regulation, a digital platform is a website, mobile application, or software that has an online seller and user community. For instance, Vinted, an online second-hand item marketplace, also falls under this regulation. In other words, that means most digital platforms that allow commercial transactions are affected, including e-money and crypto platforms.   Who is Excluded From the DAC7 Obligation?   There are a few exceptions to the new DAC7 regulation. The Directive excludes some digital platforms from the obligation to report data. Such examples include: Platforms that solely allow the listing... --- ### The Complete Sanctions Screening Guide [Updated 2025] > Sanctions screening can prevent fraud, cybercrime, or money laundering for firms. But the geopolitical landscape changes, and so do sanctions. - Published: 2023-04-06 - Modified: 2025-01-17 - URL: https://www.idenfy.com/blog/sanctions-screening-guide/ - Categories: Blog Sanctions refer to penalties or punishments imposed due to violating a law, rule, or order. That’s why associating with a sanctioned business is not only dangerous reputation-wise but also illegal. To prevent such consequences, sanctions screening helps identify and manage risks and stops the business from being exposed to unwanted criminal activity. It can be challenging to keep up with sanctions lists that are expanding daily. On top of that, sanctions are published by various issuing bodies that don’t always align. So that leaves businesses questioning the broadening definition of what sanctions screening actually is and how to make it effective.   To overcome interpretation, management, manual data reviewing, and other challenges, our guide on sanctions screening offers some valuable intel on how to maintain Anti-Money Laundering (AML) compliance and conduct efficient sanctions checks.   What is the Sanctions Screening Process? Sanctions screening is the process of checking individuals, companies, or their transactions against various sanctions lists, which consist of sanctioned parties issued by governments or international organizations. This type of screening helps identify and prevent dealings with parties involved in activities like war crimes, drug trafficking, terrorism, or human rights violations. Regulated entities, such as banks, crypto platforms, payment service providers, and other financial institutions, use this process to cross-check current and potential clients against sanctions databases to match their names and identify potential risks. In most jurisdictions, starting a business relationship with a sanctioned entity is illegal. That’s why companies must stick to Anti-Money Laundering (AML) compliance laws and ensure that both individual and corporate clients have no past or current financial sanctions imposed on them. Why Sanctions Screening is Important Governments impose economic sanctions to enhance national security and prevent illicit activities. Effectively managing sanctions risk requires companies to systematically assess and screen these countries, entities, and individuals against existing sanctions lists. So, with sanctions screening, the goal is to freeze assets and restrict trade with entities included in these lists. There are various reasons why companies screen sanctions lists, including: Unified security. Sanctions screening helps detect crime and stop the facilitation of weapons proliferation and other serious crimes using a systematic screening approach in various countries. Risk detection. Sanctions screening helps identify high-risk situations and transactions that involve sanctioned parties, which helps reduce risks and prevent unwanted non-compliance fines. Reputational insurance. With sanctions screening, companies can ensure they align with AML compliance laws, safeguarding their public image and ensuring their operations run smoothly. Sanctions screening also means possessing up-to-date and accurate data, as well as conducting thorough queries across pertinent sanction lists. Regular screening is essential for ensuring ongoing compliance. That’s why obligated entities should have well-established processes in place to address situations where a country, entity, or individual emerges on a sanctions list. Related: What is AML Screening? What is a Sanctions List? A sanction list is a compiled record list of individual sanctions that can be applied to: Individuals Companies Groups Countries States If these entities are involved or suspected to be in illegal activity, they are put on sanctions lists. Governments and international bodies, for instance, the European Union, allocate them to fight financial crime and maintain political diplomacy. For example, in the United States, sanctions lists are managed by different government bodies, including the Office of Financial Assets Control (OFAC), the Department of State,... --- ### KYC in Real Estate: Here's Your Compliance Checklist to Prevent Money Laundering > KYC is the main part of the AML compliance and an obligatory requirement for real estate, a sector very attractive to money launderers. - Published: 2023-03-31 - Modified: 2025-01-02 - URL: https://www.idenfy.com/blog/kyc-aml-real-estate/ - Categories: Blog Know Your Customer (KYC) checks have become a crucial part of the buying process when it comes to real estate transactions. Even if real estate brokers and home buyers don’t necessarily want to undergo additional security measures, Anti-Money Laundering (AML) regulations push businesses to ensure that no illegal activities are conducted in property sales. And there’s a good reason for that. Criminals use anonymous shell companies to launder dirty money through real estate. These companies allow them to conceal their identities during the purchase of a property and to benefit from the resale or rental income of those properties. But did you know that 84% of new homebuyers say the information they found online was crucial for their research? Well, businesses take a similar approach. For them, it’s important to verify the identity of buyers and understand the potential risks, as well as the applicable laws regarding this matter.   In this article, we dive deeper into the world of KYC and AML controls in the real estate sector, explaining how to stay compliant and protect your business with identity verification.   Why the Real Estate Industry Attracts Money Launderers  Millions of dollars are laundered yearly through properties, resulting in a bad reputation for real estate companies. But it’s no secret that real estate presents lucrative investment opportunities. Although regulated, this speculative market isn’t subject to the same scrutiny as a bank.   With its high value and relative anonymity, real estate is an ideal channel for money launderers to conceal the origins of their illicit funds. Here are a few examples of why:  Purchasing properties with cash. Unlike other investments, real estate can be bought with large amounts of cash without creating suspicion. Cash purchases are especially attractive to criminals who want to avoid financial institutions that may report suspicious transactions to regulatory authorities. Concealing ownership. Properties can be held through shell companies or trust funds, which can make it difficult for authorities to trace the true owners. This anonymity helps criminals to hide their illicit funds behind a legitimate-looking facade, making it difficult to detect their activities. Flipping properties. This involves buying a house, making minimal improvements, and then quickly reselling it at a higher price. This can create the appearance of legitimate income and can be used to launder illicit funds by funneling them through the sale of the property. In addition to these attributes, real estate can be attractive to criminals for its potential for capital appreciation. Since the market price of the property can increase over time, it becomes an opportunity for criminals to generate pseudo-legitimate profits when the property is eventually sold.   Common Money Laundering Ways in Real Estate Criminals launder money in real estate in two ways, mainly by undervaluing and overvaluing property.   Undervaluation refers to the practice of purchasing a property at a price lower than its market value. This often happens with shell companies or business entities that conceal the true owners. In some cases, foreign criminals may purchase property by using a front that appears to be the legitimate owner but is acting on behalf of the criminal. Money launderers can also overvalue properties to legitimize the funds they have acquired through illegal activity. For example, a money launderer could purchase a property for $500,000 and then claim it’s worth $1 million.... --- ### Case Study: SupplierPlus > Discover how iDenfy helped SupplierPlus digitize its compliance workflow with powerful AML screening and monitoring tools. - Published: 2023-03-30 - Modified: 2024-05-13 - URL: https://www.idenfy.com/use-cases/supplierplus-idenfy-study/ - Categories: Use Cases Find out how iDenfy’s AML screening and ongoing monitoring, as well as adverse media screening solutions helped SupplierPlus digitize its AML compliance workflow. SupplierPlus excels in cross-border transactions, which is also where compliance with Anti-Money Laundering (AML) requirements becomes tricky. They needed an automated AML monitoring solution for existing clients. As SupplierPlus described, a more robust screening and monitoring process for individuals and legal entities meant that they could finally “sleep better at night. ” This is where iDenfy came in and helped improve their compliance risk management with its easy API setup for faster AML red flag optimization and real-time alerts. The Challenges  SupplierPlus operates in an industry that requires a significant level of automation. The company's strategy was to prioritize technology as a means of building trust with its customers and adding more value to its service offerings. To achieve this goal, SupplierPlus searched for a way to replace manual compliance workflow with automation. According to the SCF platform, automated compliance tools became essential not only for providing customers with an excellent user experience but also for increasing profitability in its competitive market.   At the same time, SupplierPlus wanted a robust solution to simplify the CDD process. iDenfy was able to provide an AI-powered product to meet that need, ensuring compliance with AML requirements in a fast and cost-effective manner. As the company ventured into new markets, its rapid growth resulted in several new challenges: Issues with AML risk assessment. Customer risk levels were difficult to assess due to partial monitoring coverage, especially for cross-border clients. Lack of automation in AML controls. Risk mitigation efforts were bounded due to manual operations, dependence on limited data sources, and the need to collect data across multiple sources, which resulted in a lengthy, complex process. Growing risk of fraud. The company’s client base continued growing, as did the potential financial crime risks. That required additional preventative and detective fraud prevention controls. This process was time-consuming, and SupplierPlus’ team had to repeat it every time a new client or vendor was onboarded. "A successful compliance program requires real-time detection of potential risks when screening and monitoring customers. To improve our AML procedures, we began searching for a new solution,” said Indrek Vilms, Chief Compliance Officer at SupplierPlus.   “We aimed to increase our credibility and reliability for our financiers, and we believed that automation was the key to achieving this. " The Solution SupplierPlus needed an AML service that could accelerate the pace of identifying and verifying large amounts of data without interfering with the response times for existing customers or potential new users. When SupplierPlus was searching for a new service provider to strengthen its AML capacities, they considered crucial factors such as flexibility in configuration and integration as well as the ability to offer multiple AML compliance tools: SupplierPlus believed it was crucial to partner with a company that understood its regulatory obligations and could apply them effectively to the company’s distinctive business model. When selecting a long-term compliance service provider, the competitive price offered by iDenfy for automating AML screening and monitoring checks played a significant role.   Since iDenfy met... --- ### GPT-4: OpenAI Introduced a New Version of ChatGPT, But What's Different? > GPT-4 is 10 times more advanced than the previous ChatGPT model. It accepts text and image inputs, aces tests, calculates taxes, and more. - Published: 2023-03-28 - Modified: 2025-01-09 - URL: https://www.idenfy.com/blog/chat-gpt-4/ - Categories: Blog TikTok, Reddit, and the whole internet are getting wild for the most popular chatbot created by OpenAI, the AI giants who managed to develop a system so powerful that people can’t stop talking about it since November 2022. Since the introduction of the latest version, GPT-4, a lot has changed in, once again, how we write outreach emails, generate code, do homework… And a whole bunch of other things — all powered by artificial intelligence. And surprise, surprise. For all of those who haven’t lived under a rock, you already know that OpenAI has announced its release of the latest language model, GPT-4. This new version can accept both text and image inputs, at the same time, generate text outputs.   So what’s so special about GPT-4? It has been designed to improve the ability to follow user intentions while making it more truthful and generating less dangerous output.   And we’re talking about some serious, mind-blowing things. For instance, OpenAI’s Greg Brockman showed an example of creating a working website from a simple sketch photograph of a handwritten sketch from his notebook. That’s why many GPT-4 users are now calling the chatbot the future of computing or, in simple terms, the coolest thing today.   What is GPT-4? On March 14, 2023, OpenAI released GPT-4, a multimodal AI model with advanced capabilities.   GPT-4 is short for Generating Pre-trained Transformer 4, which is the fourth iteration of the GPT family of large language models. It’s an updated version of ChatGPT, which is trained on vast amounts of online data to generate complex responses to user prompts. GPT-4 surpasses its predecessor GPT-3. 5 in several ways. It has enhanced intellectual capabilities that result in improved accuracy, steerability, better academic performance, and other benefits. How Much Better is GPT-4 Than GPT-3? GPT-4 is a newer and improved version of GPT-3. 5 that is 10 times more advanced. This upgrade allows the model to have a better understanding of context and differentiate nuances, leading to more precise and logical answers. What’s more exciting is that GPT-4 has a higher memory limit, which means it can process up to 25,000 words. This improvement not only enables GPT-4 to have longer conversations and generate lengthier responses but also enables it to search through and analyze large volumes of text in documents. What’s New in GPT-4?   The most game-changing breakthrough is that GPT-4 now has a multimodal feature, combining both language and vision models, which allows it to understand images. This is a significant advancement that opens up various possibilities, including aiding the visually impaired, enhancing accessibility, moderation, and more.   To actually witness the capabilities of the newest ChatGPT version, you can watch OpenAI’s live stream.   OpenAI Demonstrates the Capabilities of GPT-4:  It turned a sketch into a webpage Described images in great detail Created a Discord bot Calculated taxes 4 Things GPT-4 Can Do That ChatGPT Couldn’t Even though OpenAI officials claim that the distinction between GPT-3. 5 and GPT-4 is subtle at first glance, the scale of improvement comes out when the new ChatGPT bot is asked to complete more complex tasks.   GPT-4 can handle more detailed instructions and is more reliable as well as creative compared to GPT-3. 5. It can not only generate basic text but create screenplays, poems, or songs while mimicking users’ writing styles to achieve more personalized results.   GPT-4 accepts different inputs in the form of text and... --- ### What is Adverse Media Screening? Effective Practice for AML Compliance > Adverse media screening, or negative news, is crucial. But beyond compliance, checking different media is beneficial for managing risks. - Published: 2023-03-17 - Modified: 2025-01-10 - URL: https://www.idenfy.com/blog/adverse-media-screening/ - Categories: Blog Adverse media refers to any negative or bad information published about brands, companies, and individuals in various media outlets. But why is it important? Well, first of all, screening negative news is crucial for businesses as it helps them steer clear of any association with harmful entities involved in money laundering or terrorist financing. You can say that adverse media checks are one of the most effective ways to see the whole picture of the entity that you’re screening, helping you protect your business against various risks. However, these potential threats aren’t the only reason why adverse media screening has become popular over the past few years.   Adverse media screening is part of Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance processes. That means if you’re operating in a regulated industry, you may be legally obliged to conduct these negative news checks. Despite the mandatory requirements, we explain in this article why adverse media screening benefits all sorts of businesses.   The Process of Adverse Media Screening Adverse media screening, often also called negative news screening, is the process of investigating negative information about an individual or business that you intend to engage with. The goal of this check is to reveal an entity’s involvement in fraudulent activities.   In brief: Adverse media is a crucial competent of customer due diligence (CDD). It’s an effective way to maintain a reputation and reduce the risks of getting involved in criminal activity.   Although rules on screening for adverse media are less structured than for other compliance requirements like sanctions and politically exposed persons (PEPs), it has become a crucial part of successful AML programs. Automated adverse media checks can scan and review large media sources, allowing businesses to review data accurately in less time. Adverse media screening involves reviewing both online and offline news sources, including blogs, websites, social media, television, and radio. Financial institutions are the primary users of adverse media screening to identify and prevent potential money laundering risks. However, other industries are also using this screening process to identify other types of risks, such as environmental, social, and corporate governance (ESG) risks. Why is Adverse Media Important?   Adverse media screening is crucial because it helps detect risks and assists the business in deciding how to handle potential threats to its reputation, particularly from business partners who pose sudden risks. Companies need to continuously monitor news sources for any negative information regarding their current or potential clients. Regular adverse media checks demonstrate the company’s commitment to responsible compliance and its efforts to prevent illegal activity. According to AML obligations, regulated companies must conduct ongoing customer due diligence (CDD). These requirements were defined by the Final CDD Rule, explaining that companies must screen and monitor each customer throughout their business relationship, especially during the KYC onboarding process.   This is when negative news screening prompts a company to expand its compliance program.   Compliance Guidelines for Adverse Media Checks  With the increasing regulatory requirements regarding money laundering and related financial crimes, integrating adverse media screening into your compliance practices can bring significant benefits.   To establish an effective compliance program, businesses must adhere to the following regulations: In the United States The Financial Crimes Enforcement Network (FinCEN) requires regulated businesses to comply with the Bank Secrecy Act (BSA). Adverse media screening... --- ### KYC vs AML: Key Differences in Compliance [Updated] > From verifying customer identity to checking sanctions and PEP lists. Learn the key differences and find out how KYC and AML work together. - Published: 2023-03-09 - Modified: 2025-05-02 - URL: https://www.idenfy.com/blog/kyc-aml-compliance/ - Categories: Blog, KYB/AML KYC, AML, CDD… Similar but very different compliance terms that people tend to confuse. While regulations vary across countries and different areas, nowadays, not only financial institutions but many other businesses need to know the differences between the mentioned components to maintain effective Anti-Money Laundering programs. So here’s the deal. Know Your Customer (KYC) and Anti-Money Laundering (AML) are similar terms, but they have distinct regulatory differences. KYC focuses on verifying customer identities, while AML covers broader efforts to detect and stop money laundering. Both regulations are designed to stop criminals from obtaining illicit funds and illegally disguising dirty money as legitimate income. Like many compliance rules, KYC and AML laws require businesses to be familiar with the difference between the two compliance components and understand how they are connected in the whole regulatory process. Both KYC and AML are essential in fighting financial crime. However, each compliance process serves a distinct, and, at the same time, connected role within a bigger, more complex regulatory program used in industries like banking or e-commerce. In brief: KYC refers to identity verification checks that businesses perform to guarantee their users are who they claim to be, especially before providing them with access to their network.   AML refers to the set of policies and processes that companies take to prevent criminals from laundering money that comes from illicit activity. AML regulations were primarily created to prevent terrorist financing and money that comes from crimes like human trafficking.   In this guide, we’ll explain their key differences, how they work together in compliance programs, and best practices to stay KYC/AML-compliant. What is KYC? KYC, or Know Your Customer, is a verification process, which involves collecting personal data used for verifying a user's identity during the onboarding process (when they first create the account). Otherwise, KYC checks can be repeated later on. For example, companies conduct identity verification in riskier scenarios, such as: When a customer makes a large transaction: AML regulations require financial institutions to proceed with KYC for security reasons. When a customer establishes a business relationship: For example, during the onboarding process or before opening a bank account. When a customer is flagged for suspicious activity: For instance, if they’re suspected of being linked to potential criminal activity, such as money laundering. Identity verification or KYC compliance checks mean that a business is familiar with its customers and their financial transactions. The main goal of KYC is to help institutions gather sufficient information about their customers to assess risk, prevent fraud, and comply with regulations. Automatically, that makes KYC-compliant companies more aware of suspicious activity, helping them reduce severe risks, including being exploited for money laundering reasons. ➡️ A customer in KYC is considered to be either an individual or a business. Despite that, KYC for businesses has a separate term, corporate KYC, often called Know Your Business (KYB). What is AML? AML, or Anti-Money Laundering, refers to a set of measures companies must apply to protect themselves from money laundering. Common AML processes include screening against various AML databases to check if there are any matches. This helps identify risky customers, as they often require extra AML processes, such as ongoing monitoring using transaction monitoring or period screening of PEPs and sanctions lists, including screening against... --- ### Identity verification in Shopify with Zapier > Learn how to integrate identity verification into e-commerce powered by Shopify and the automation tool - Zapier. - Published: 2023-03-09 - Modified: 2025-01-14 - URL: https://www.idenfy.com/blog/identity-verification-in-shopify-with-zapier/ - Categories: Blog, Use Cases In this guide, you will learn how to integrate identity verification into your e-commerce website powered by Shopify within ~15 minutes. To make integration fully customizable on your end, we will use our official Zapier plugin to automate workflow. How to implement identity verification in an eCommerce website? To get started with identity verification to onboard customers successfully, we must familiarize ourselves with the critical steps required for the correct know-your-customer procedure:1. Customer’s onboarding journey needs to be monitored. You need to ensure that you distinguish between the guest user, registered user, and verified one. 2. Assign verification status next to your customer. This is used to verify processed orders and double-check whether the user is successfully verified. 3. Create additional automation and notify the customer of his verification status. For instance, you should send an email once the customer is successfully verified. If he is denied, it is a common practice to display additional information, providing concrete steps to retry verification. How Zapier automates identity verification Since Shopify is a platform specifically designed for merchants, it is the ideal solution to have identity verification installed right into your e-commerce store. For that, we will utilize Zapier. Zapier is a workflow automation tool with 5000+ other applications. We at iDenfy also published our official plugin - the first first-party solution for identifying customers on Zapier. Together with the Shopify plugin, iDenfy integration can create powerful workflows which trigger during specific actions from Shopify: new orders, new paid orders,  new or updated customers’ data. Once events are triggered, ID verification or AML checks are initiated. Also, you can add additional integration with other applications of your choice: Salesforce, Hubspot, etc. To start the workflow, simply complete the registration in the Zapier platform and start a new project by connecting Shopify app with iDenfy. Integrate identity verification with 3 steps  The first step is to create an identity verification request once the customer is created in Shopify. For that, the Zapier triggers are the perfect solution since they automatically will detect new account creations. Once detected, Zapier will use our API to create verification tokens. The generated API token appended to the redirection URL needs to be delivered to the client. We can use any email provider, in this case, Gmail. Here you can automatically integrate this Zap. The second step is to set up another Zap, solely responsible for using the verification status to update customer data directly in Shopify. For that, we will create two different paths: for approved and for denied verifications. The Zap triggers once a new verification is initialized. Then, once verification is finished - we check for verification status to determine the next pathway. If the verification status is approved, we update the customer, otherwise - we ask the user to retry by sending a new email. Below you can see the workflow of approved verification. We are utilizing the customer's email address to find him in Shopify. Once found, we assign a custom tag with verification status. The naming logic is completely up to your style, but for the sake of simplicity, we’ll add a hyphen after idenfy, thus resulting in the following tag - “idenfy-APPROVED”. Unfortunately , Zapier does not allow sharing the... --- ### AML Compliance Program: 5 Steps that You Need to Take in 2025 > AML compliance program defines your actions towards meeting AML requirements. However, effective AML checklist includes multiple steps. - Published: 2023-03-09 - Modified: 2025-01-14 - URL: https://www.idenfy.com/blog/aml-compliance-program/ - Categories: Blog Fraudsters constantly launder money without getting caught. The only way to prevent illicit crimes is to follow AML compliance guidelines, which include proper internal operations, security policies, data monitoring, and fraud detection. In this article, we’ll explore real-life use cases and share some valuable tips on how to improve your compliance program. Regulatory compliance consists of many rules and processes that organizations must follow. Anti-Money Laundering (AML) compliance guidelines aim to help prevent money laundering and terrorist financing while stopping other forms of fraud and illegal activities. Whether a company must follow AML rules depends on the industry in which it operates. For example, in the US, the requirement for companies to implement AML compliance programs is defined in the Bank Secrecy Act (BSA). This legislation outlines specific criteria, mandating that financial institutions identify and report suspicious activities to the government through Suspicious Activity Reports (SARs).   However, if the business has financial transactions, it will be mandatory for them to follow AML compliance guidelines. So, it doesn’t matter if you’re just starting out or looking to improve your current AML compliance program; having a comprehensive checklist and guidelines in place is vital. Key notes to remember: There are international (for example, Financial Action Task Force’s (FATF) rules), national, and country-specific (such as the Acts in the US) regulations.   Depending on the location, the most common industries that are subject to AML compliance are banks, insurance firms, casinos and gaming establishments, lawyers, accountants, cryptocurrency exchanges, insurance companies, forex brokers, tax advisors, and others.   What is an AML Compliance Program?   An AML compliance program is a set of regulations designed to combat financial crimes. Regulatory authorities implement and regularly update these regulations to align with current conditions. To stay compliant with AML standards, companies must integrate internal controls such as employee training, account monitoring, detection of suspicious transactions, and the reporting of suspicious activities. Due to the intricate nature of procedures and the dynamic nature of the financial landscape, creating a robust AML program can be challenging. That’s why companies need to assess all related factors that could be influencing compliance, including: Understanding the applicable local and global laws and the consequences of non-compliance. Identifying the risks associated with money laundering and potentially suspicious activities within the company. To summarize: The goal. AML compliance programs identify, react to, and eliminate fraud risks related to money laundering and terrorist financing.   The importance. An effective compliance program enables the business to find out about potential money laundering risks, learn in-depth about non-compliance laws, and prevent suspicious activities within the organization.   What Makes an AML Compliance Program Effective? The Federal Financial Institutions Examination Council (FFIEC) outlines essential components for an effective BSA/AML compliance program, obliging institutions to: Implement an internal control system to ensure continuous compliance. Conduct independent testing for compliance, performed either by bank personnel or an independent third party. Appoint a compliance officer responsible for day-to-day oversight of compliance activities. Ensure ongoing training for employees. Establish a risk-based Customer Identification Program (CIP) to verify customer identities. Include measures for Customer Due Diligence (CDD) and comply with beneficial ownership requirements specified in regulations issued by the Financial Crimes Enforcement Network (FinCEN). Related: AML Regulations in the USA — Everything You Should Know as a Business Owner What Risks Impact AML... --- ### Is ChatGPT Secure? Here’s Everything You Need to Know  > ChatGPT can be a security threat, and malicious attackers already mastered the tricks that pave the way to fraud. But is it actually that bad? - Published: 2023-02-09 - Modified: 2025-01-15 - URL: https://www.idenfy.com/blog/chatgpt-security/ - Categories: Blog ChatGPT reached a million users in less than a week. This is no surprise, especially considering the countless possibilities the human-like chatbot provides. From solving math equations, writing music, or grading essays, it seems that there’s not a single task that ChatGPT can’t accomplish. But once we go deeper, we realize there’s a fine line between its capabilities and newly created security risks. Despite the recent hype, cybersecurity specialists have strongly criticized the bot’s expertise, calling it a “malware-writing” tool and the next big threat to security. That’s partly because powerful AI systems, such as ChatGPT, create real-time content based on the data collected during the training period. What’s left of that part is that such large language models typically lack up-to-date knowledge and error-correction abilities. While being close to supernatural, in contrast, ChatGPT is already known for its limitations. In this article, we look closer into the wonders of this advanced technology, explaining how it affects the fraud and cybersecurity landscape.   What is ChatGPT? In translation, ChatGPT stands for Chat Generative Pre-trained Transformer. OpenAI, an AI research team, launched the now millions-worth chatbot in November 2022. Its complex machine-learning model performs different tasks, including responding to users in a human-like manner, performing calculations, or even generating code.   How ChatGPT Actually Works  ChatGPT was trained using supervised fine-tuning and Reinforcement Learning from Human Feedback (RLHF). It’s now safe to say that the creators of this language model managed to transform AI technology into a successful engine that can learn, process large amounts of data, and perform tasks. That’s why using ChatGPT is pretty simple. All you need to do is create an account and start typing your text to receive the chatbot’s answers. Like many AI things, the Internet has hoped on the trend of trying to misuse the chatbot, programming it to make up facts. But ChatGPT exclusively claims not to be designed to generate false or fictitious information. Its CEO and prominent Silicon Valley investor, Sam Altman, has recently assured users that the system will “get better over time”. Why are People Worried About ChatGPT? Many are concerned about AI inventions replacing humans. With the ability to instantly provide full-length articles, many people agree that this AI bot has better writing skills than the average human being. But even after striking a long-term $10 billion investment from Microsoft, ChatGPT continues to receive criticism in the education sector over sparking a wave of cheating in exams and doing students’ homework. For this reason, some schools decided to block access to the AI bot.   A Tool for Recognizing ChatGPT Apparently, it’s now possible to spot AI’s text. ChatGPT’s creators responded to the public, recently announcing a new Text Classifier for indicating AI-written content. At this point, unsurprisingly, there’s a red disclaimer about the new tool, reminding its users about the unreliability factor. The new tool for Open AI spots “likely AI-written” text, so the results aren’t 100% accurate. This means that the Text Classifier needs some improvement and shouldn’t become the sole piece of evidence by making the final decision on whether the text is written by AI or a human being.   Future ChatGPT Plans and Recent Launches After rumors surfaced about a paid version of ChatGPT, the company announced launching a new paid subscription plan on the 1st of February. According to company officials, ChatGPT Plus will offer... --- ### A Definitive Guide on KYC for Crypto [Updated] > Access the latest insights on KYC for crypto, the Travel Rule, EU's AMLDs and the related FAQs that blockchain enthusiasts want to know. - Published: 2023-02-07 - Modified: 2024-11-08 - URL: https://www.idenfy.com/blog/kyc-for-crypto/ - Categories: Blog, Identity Verification It’s an open secret that cryptocurrencies were introduced to tackle the problems of centralization and lack of authority in finance after the 2008 financial crisis. Though they have been used in illegal activities, they have ended up causing billions of dollars in damage. Read more. Governments classify blockchain and crypto service providers as Virtual Asset Service Providers (VASPs) and impose Anti-Money Laundering (AML) regulations. This requires crypto companies to implement thorough Know Your Customer (KYC) processes to scrutinize their clients. Additionally, they now have to stick to stricter requirements. One major example in this context is the Travel Rule, which imposed new obligations, including new thresholds or reporting requirements, among other nuances that aim to combat fraud in the crypto landscape. Additionally, crypto service providers must implement diligent identity verification procedures. But the ultimate question remains — how can we stay safe and conduct proper KYC checks to avoid hefty compliance fines? Get ready to stay ahead of the game in the crypto world with our ultimate guide to KYC! We’ll cover the following highlights: What is KYC in blockchain? How to implement KYC? What is AML in blockchain? Why do crypto startups need KYC? How are crypto exchanges performing KYC?   What are the benefits of KYC for crypto startups? How to tackle the challenges of KYC checks? What’s the future of crypto with KYC?   What is KYC in Blockchain? Crypto exchanges, NFT marketplaces, and digital finance involved in blockchain activities must follow the needs of the local governments for KYC requirements. However, KYC for crypto goes beyond mandatory regulatory requirements. It protects crypto users from fraud by safeguarding their transactions, especially if they’re new to the trading world and are more vulnerable to scams, which are getting more sophisticated by the minute. Key facts to remember about the KYC process: KYC is the get-to-know-your-client procedure blockchain financial services conduct before allowing potential users to transact via the platform. KYC is not a bypass procedure for blockchain financial services. The use of KYC in blockchain fintech products poses a necessity for customer due diligence (CDD). What is Customer Due Diligence? CDD is used by crypto companies and other regulated institutions, such as banks, to verify users and assess their risk profiles. The main CDD measures include the verification and identification of customers, risk assessment, and ongoing monitoring. CDD makes it possible for companies to identify their customers. For example, confirming identities is done by comparing legal documents with government requirements. The standard information required usually includes: Full name Date of Birth E-mail Phone number Country and address of residence Identification cards OTP validation Making this all a bit more binding, some jurisdictions have introduced more concrete requirements, such as the mentioned Travel Rule. This goes way back to 2019 when the Financial Crimes Enforcement Network (FinCEN) implemented regulations that demand that financial firms and VASPs obtain and share information on all originators and beneficiaries of economic transactions, and it also extends to crypto. Before the Travel Rule: Companies that did wire transfers with regular money flow had to share certain information. Today: This rule now requires financial companies and VASPs to gather and share information about who is sending and receiving funds in a transaction. This also refers to crypto transactions.   Interesting... --- ### Proxy Network: Use Cases and Identity Verification Tips > Discover the best proxy practices for protecting your network and sensitive information with identity verification. - Published: 2023-01-26 - Modified: 2025-01-15 - URL: https://www.idenfy.com/blog/proxy-security/ - Categories: Blog, Identity Verification There’s an ultimate feature that describes all cybercriminals accurately. Spoiler alert – it’s the fact that they want to stay anonymous. For years, proxy servers supported malicious actors, helping them blend in and conduct dangerous crimes. But can identity verification end this era? You might be familiar with the term “proxy”. From bad actors reselling proxy servers in forums to shady users buying them for illegal purposes, there’s much more to proxies than the need to stay anonymous while browsing online.   In this article, we talk about the good and the bad proxy network side, including notorious proxy crimes, malicious proxy examples, illegal underground proxy markets, reselling forums, web scraping, and of course, the role of identity verification.   What is a Proxy Server? A proxy server is a gateway between a user and the internet. It acts as an intermediary and separates end users from the websites they visit. When using a proxy, the traffic goes through the proxy server to the user’s requested address. That’s why the request returns to the same proxy, forwarding it and the data received to the user.   Key facts: Modern proxy servers provide a high level of functionality and do much more than forwarding users’ web requests. Good proxy servers provide not only much-needed privacy but also protection, preventing users from getting tangled in malicious cybercriminals’ traps. A Brief History of Proxies The concept of proxies goes back to the 1970s when internet networks were first introduced to the public. In the primary proxy days, internet users used them to cache frequently requested web pages and speed the access to content. But hey, the internet evolved, and so did proxies.   Here’s a quick timeline showing the evolution of proxies.   1990s: Internet users choose proxies as a way to control access to content in educational and corporate contexts. This helps restrict access to certain content and monitor internet activity.   2000s: People now recognize proxy servers as a new tool to protect their privacy. Anonymous proxy servers help users hide their IPs and encrypt internet traffic, making it hard to track their activities.   Present day: Users can now enjoy a wide range of proxy services, including as a way to protect themselves from cyber-attacks, content filtering, load balancing, or anonymizing internet activity.   So what’s with all the fuss around bad proxies, and why would a hacker use a proxy server?   Historically, hackers often used proxy networks built on malicious code. Victims would then be tricked into downloading the malware families on their PCs. Malware would then often lead to infected machine networks, known as botnets.   Once a user had been compromised, their computer would be used to infect others. Their IP address would be used as an additional tool in malicious proxy network activity. This cyberattack model has been around for years. Despite that, its success was affected by various security solutions, such as antivirus software.   Malicious Proxy Network Examples Even though security experts have updated their knowledge of this type of service, attackers have advanced their techniques, expanding their range of fraudulent activities. Just check out the following examples of malicious proxy networks. The VIP72 Case One of the classic examples of now a no longer existing... --- ### Case Study: The Everset > Find out how iDenfy is revolutionizing the fraud prevention landscape and helping The Everset save costs with identity verification. - Published: 2023-01-24 - Modified: 2024-05-07 - URL: https://www.idenfy.com/use-cases/the-everset-idenfy-study/ - Categories: Use Cases Discover how iDenfy's identity verification service enabled The Everset to establish an automated onboarding process and maintain secure personal data records, effectively minimizing fraud rates. Before iDenfy, The Everset needed to find a more robust way to verify new order customer IDs, as well as having this information on file to use as a deterrent for bad actors who attempted to bypass the credit reporting/collections system in the US. The lack of data prevented the business from deterring serious delinquency and theft due to NPNR – Non-Payment/Non-Return – of the furniture. Explore the customer success story in greater detail below. The Challenges The Everset aims to change what the moving process entails for everyone fundamentally. That means, instead of being knee-deep in moving and deciding which pieces of furniture to sell next, the company helps customers eliminate furniture waste. This concept has gained recognition, helping the business swiftly grow its customer base while building a new security standard in furniture rental services.   With the increasing customer volumes, The Everset wanted to enhance its security and offer the best possible services, including a smooth and secure furniture transaction process. The newly set goals required some changes in the identity verification process.   The main challenge with the consumer rental service offering was verifying that the name on the order and billing information was the person placing the order. Past practices showed that some of the customers didn’t have a verified ID document for billing purposes. The Everset noticed these challenges:  In the case of bad actors, The Everset didn’t have records of government IDs on file. The lack of collected data on file resulted in a high NPNR rate (Non-Payment/Non-Return) of the furniture, resulting in the loss of inventory and thousands in damage. “NPNR was a huge liability for our bottom line,” said Ben Stewart, Head of Customer Experience at The Everset.   “Besides the loss of expected recurring revenue, the non-return of our furniture was an inventory and outlay cost loss. ” Traditional in-person meetings and customer data storage using paper documents weren’t an option for The Everset. Instead of a manual approach to verifying customer information, the company overcame security challenges with a digital, automated, cost-effective solution and turned to iDenfy.   The Solution  The Everset hoped that having to verify identity to receive the delivery and knowing the company has personal information on file would eliminate previous challenges and drastically reduce the fraudulent transaction occurrence.   Relying on manual authentication methods without properly storing identity data caused fraud detection and user experience issues.   According to the company, these issues simply affected the business when The Everset entered the furniture service market as a startup in 2019: Between its launch in Fall 2019 and March 2021, The Everset had a running rate of 13% of active accounts falling into the NPNR classification. The average loss to the company for these accounts was several thousand dollars each.   The Everset started to search for a new way to onboard customers. The goal was to have identity information on file to use as a deterrent for bad actors who attempt to game the credit... --- ### The Guide to Decentralized Identity in 2023 > Learn about the history of decentralized identity, integration with blockchain, and its impact on our biometric data. - Published: 2023-01-19 - Modified: 2023-01-19 - URL: https://www.idenfy.com/blog/the-guide-to-decentralized-identity-in-2023/ - Categories: Blog, Identity Verification The internet has been turned into a gold mine for data. Users have filled up their storage banks with millions of data pieces, defining who they are both digitally and IRL. But now Web3 has birthed a new idea by which humans can safely engage with their data through digital identity. A few years back, the internet left us with no other data storage means, so centralization has been the sole of the storage business. Despite the technology and its success, cybercrime hasn’t left the picture to this day. That’s precisely why data breaches have led to a lot of crises, such as stolen identities being used for fake registrations, stolen credit cards being sold in the black market, etc. This has shown a lapse when it comes to centralization and identity storage. So in this ultimate guide, we’ll be answering different questions that surround decentralized identity: What is decentralized identity? Why do we need a decentralized identity? How does decentralized identity work? Does decentralized identity have any limits? What does the future hold for decentralized identity? How does identity verification improve security?   What is Decentralized Identity? A decentralized identity, or self-sovereign identity, is an approach to how internet users can engage and manage their data. It's a manner through which data or credentials that verify a user are controlled by the user. To put it simply, a decentralized identity gives users a democratic concept to use and manage their data. The data that defines each user's identity is referred to as personally identifiable information (PII). This set of data, when decentralized, cuts out the time-consuming process of authentication between various organizations. For example, a decentralized driver's license can be verified to be genuine on the blockchain without going through the issuer. Blockchain technology ensures trust and transparency in its operation, so records of the issuer and the date issued can be publicly tracked by anyone from any computer.   Why Do We Need a Decentralized Identity? The internet has been the bridge between humans and digital services. To enjoy these services, users are left with no choice but to submit the required personally identifiable information (PII). That said, the question narrows down to why we need a decentralized identity in the first place.   Ease of access: Decentralized identity gives users the easiest means of accessing the internet without restrictions on logins.   Ownership and control of data: One thing decentralization does so well is eliminating third-party control. It retains the user's ownership right, thereby making the data self-owned and controlled. In a broader sense, users only give out data that is worthy of being used by any organization, and limitations on what is allowed on the public internet are reduced through Zero-knowledge proofs. Seamless authentication: The case of forgotten usernames and passwords is a common thing in the digital space, and a thousand sites simply mean a vast number of varying passwords and usernames. This problem, coupled with the repetitive use of highly private identifiers to access digital services, is seen as a deficiency in web2. In contrast, using a decentralized identity provides a single identity for various access instead of usernames and passwords. Enhanced data security: A report from Statista shows that 15 million data records were exposed through data breaches during the first quarter of 2022.... --- ### Identity Verification WordPress Plugin Setup Guide > A short guide on how to get started with identity verification on website powered by WordPress. Read More in Our Blog! - Published: 2023-01-11 - Modified: 2025-01-16 - URL: https://www.idenfy.com/use-cases/identity-verification-wordpress-plugin-setup-guide/ - Categories: Use Cases We’re happy to present an easy way to get started with identity verification on your website powered by WordPress. Take a look at the bonus section, specifically dedicated to e-commerce customers! Why do we need identity verification, to begin with? Before jumping straight into integration, it is great to understand the risks and fraud cases customers face today interacting with websites powered by WordPress: e-commerce sites, e-learning platforms, and online forums. We’ve identified key fraud cases:1. Spam and synthetic identity fraud throughout communities. Users create spam and send malicious websites without facing any repercussions for their fraudulent activity. By creating an onboarding flow powered by identity verification, customers will think twice before committing fraud. 2. Payment and chargeback frauds. Customers use stolen credit card numbers or misuse refund policy by creating fraudulent chargebacks. Again, all stems from the fact that customers are not properly identified. Once you’ve successfully verified their identity and ensured that they comply with your age-imposed policies, it will significantly reduce these types of fraud. Prerequisites for your WordPress site If you already have your website running on WordPress, you can skip this part and go straight to the installations and API keys.   Here you have 2 options available for you. Either use https://wordpress. com/ or https://wordpress. org/. The main difference is that https://wordpress. com/ provides hosting and an easier setup. For https://wordpress. org/ you need to host WordPress yourself. Though in 2023, this is a relatively easy task, you can read more about hosting solutions here. Once you have successfully installed WordPress, you can proceed to install our iDenfy Plugin. Installations and API Keys You can find our iDenfy plugin by typing “idenfy” in the plugins search bar. After installing, you can then activate the plugin by providing our API keys. API keys are issued once the account is created, or you can create them in our admin dashboard. Once done, you will see new settings appear in the menu. By opening it, you need to either register or provide the current keys. After completing it, you should see the plugin setup screen. The shortcode then should be copied into a specific page, and the plugin is activated. After clicking on it, a user will be redirected to our identity verification platform to complete the KYC process. Then it will be redirected back to your provided URL, but more on that in the next paragraph. Usage Our plugin is designed in a way to enable seamless identity verification without a need to create custom API integration, compatible with the WordPress interface. As a result, there are still some steps that require decision-making on your side. Our opinionated setup guide is as follows: 1. Choose your initial page. This will be a page where identity verification is initialized. Most often, we suggest selecting a specific product page or a screen before the checkout. Then your customer’s journey would consist of adding items to the checkout, but once the customer decides to complete the order - you redirect them to the verification page. 2. Choose your destination page. Once the customer completes identity verification, he is getting redirected back to the specified page. We do accept different URLs... --- ### Understanding Web3 and its Security Measures > From Web1 to Web3. It seems that the possibilities are endless and so are the security challenges. That's why we have identity verification. - Published: 2023-01-05 - Modified: 2024-04-11 - URL: https://www.idenfy.com/blog/web3-security-verification/ - Categories: Blog, Identity Verification The static, the responsive, and the semantic are seen as how the internet has evolved. The evolution of web3 might be slow with current trends, but positive adoption is being noticed. The ultimate question that still gives headaches to some critics is the security factor. Tag along to find out more. Like Stewart Brand said, "Once a new technology rolls over you, if you're not part of the steamroller, you're part of the road. ” While the use of this technology is still new, it has managed to catch some attention. A report from Bankless Times shows that 46% of finance apps are based on web3 technology. Additionally, in the first half of 2022, web3 companies raised more than $1. 8 billion. There are internet users, both individuals and brands, who are slightly ignorant of how to manage things on web3. This unawareness can make them easy bait for scammers and their illicit activities.   To help overcome security challenges and answer all your web3 questions, we’ll focus on understanding this technology in a more detailed way. Here are the subtopics: The internet’s evolution throughout the years Current trends and web3 predictions Popular web3 use cases  The various benefits of web3 The importance of security and web3 How KYC helps safeguard web3 businesses Evolution of the Internet Just like how computers have evolved from the big ENIACs and UNIVACs to what fits into our palms overnight, so also the internet. Let's take a glance into what web3 and its predecessors are. Web1. 0 This is the first iteration of the internet, and it is referred to as the static internet. It uses the one-to-many approach where users can only consume information and give responses offline if need be. The web pages are either filled with text or images, which are only enhanced using colors and are rigid to being read-only. Timeline: This generation of internet lasted from 1991 to 2004. Web 2. 0 This is the game-changer of the internet. It switched from being read-only to an interactive and dynamic internet. The use of complex algorithms and the development of software as a service was introduced. Web 2. 0 is known best for the social media age. That meant the internet had given its consumers the power to become creators simply by using dedicated media apps. Web 2. 0 brought about the internet of things between devices and apps. It also encouraged active participation, emphasized attention, and introduced e-commerce, digital marketing, and other forms of online services that were not formerly possible on web 1. 0. Timeline: This generation started in 2005, and it is still in use. Web 3. 0 This is the newest iteration of the internet, gradually revolutionizing the internet and the way it is used. You can say that the dynamic internet (web 2. 0) faces data vulnerabilities and middlemen challenges. Hackers can use tricky means to get unauthorized access and do illegal activities.   The economy of data has been revolutionized with the use of the blockchain internet, which is known as either the semantic web or the read-write-own web. The users of this web are given power over their data, therefore, eliminating the need for centralization. Timeline: Web 3. 0 was introduced in 2014 but gained major recognition in 2021, remaining one of the most... --- ### iDenfy Through Adomas’ Eyes: Motivation, Challenges, and All That Jazz > Meet our Product Owner, Adomas Vitkauskas! He talks about the essence of communication, collaboration, and the overall life at the startup. - Published: 2022-12-28 - Modified: 2022-12-28 - URL: https://www.idenfy.com/blog/adomas-product-owner/ - Categories: Blog If you’re not up to speed with iDenfy’s tech environment, now’s the chance to catch up. This time, we’re presenting our Product Owner, Adomas Vitkauskas! Do you think it's good to rely on other people for help? No matter the answer you’ve picked, specialists like Adomas must always be ready to make important decisions. Some can be simple, others more complex, but it’s the Product Owner’s job to lead the team, prioritize tasks, and coordinate decisions. Of course, the list goes on. Let’s not waste time and jump right in to see what Adomas himself has to say about his experience as the one and only Product Owner at iDenfy. Quick Intro Hi, everyone! I’m humbled to be invited and have some spotlight on our blog. It’s always hard to describe myself, as I feel like I’m constantly developing as a person. iDenfy contributes to my self-improvement a lot since working with technology pushes you to turn your dynamic levels up and adjust to the environment around you. Despite that, I don’t get an overwhelming feeling when I think about it. I love overcoming obstacles and facing new challenges. Why Freedom and Passion Hold Value The most important thing in life, if we don’t count our health, for me, is being free. I feel like we shouldn’t take it for granted. People are free to be passionate about anything, and it’s natural to be inspired more by self-assured individuals who have interesting stories to tell. That’s why passionate people and their stories inspire me. For example, how Ukrainians are fighting for our Freedom, how they share the motivation with each other, how they celebrate every small win, etc. It’s always amazing to watch and experience stories where strong people are the main characters. Rocky Start Led to Major Achievements Believe it or not, I can confidently say that every part of my job is still very exciting. As a Product Owner, I know I’m an independent problem-solver when it comes to certain duties. Despite that, without my team, I wouldn’t see such rapid results and achievements. Hopefully, some of you will read this blog – I’d like to give huge kudos to my teammates and all their long hours of work. We’re putting the majority of our effort into product development right now. Alongside the increasing speed of creating new tools for iDenfy, we’re also focusing more on marketing. My story about joining this startup was a textbook example of a pleasant yet challenging start. There were many tasks for me already lined up. The team onboarded me and helped me to go through the process with transparent communication, which I appreciate. That’s why when iDenfy welcomed me last January, everything was different back then, including system functionality and design, not to mention our website. When we’re working hard, and it pays off with positive results, you wake up the next morning excited to head to the office. The Importance of Taking Chances Before iDenfy, I was a student. I used my free time to take as many chances as possible, which led me to try out all kinds of different jobs. I put myself... --- ### How Identity Verification is Helping Combat Cryptocurrency Crimes > Learn more about how identity verification helps to combat cryptocurrency crimes. IDenfy is Here to Share Their Knowledge! - Published: 2022-12-01 - Modified: 2025-01-20 - URL: https://www.idenfy.com/blog/identity-verification-helping-combat-cryptocurrency-crimes/ - Categories: Blog - Tags: Identity verification While the use of cryptocurrency for payment is gradually getting into the mainstream and inviting more users to experience what the fuss is about, regulators seek to implement more robust security measures to tackle the ongoing issue of crypto crimes. Still confused about cryptocurrencies? Let’s just say that you're not alone. Before you invest in any digital currency, it’s essential to learn the key ways to secure your identity and prevent becoming a victim of a crypto scam. How Much Was Lost in Crypto Scams?   Even though the cryptocurrency market will most certainly fluctuate, and crypto non-believers will continue to bash the use of digital currencies, it seems that recent years have proved otherwise. Crypto is here to stay.   Despite the shiny outside, there’s a darker side to crypto, one of the most discussed topics of today’s digital scene. For starters, the number of crypto-related scams is increasing. Let’s jump straight into some facts: Despite volatility, a good number of people enjoy the ease of using crypto, but more than 46,000 people have reported losing over $1 billion to crypto scams (Source: FTC).   Wormhole is a blockchain bridge that also reported a loss of 120,000 wETH to a cyberattack resulting from improper account validation (Source: TechTarget). The biggest cryptocurrency exchange, Binance, also suffered an attack of $570 million caused because of a loophole from a DeFi cross-chain platform (Source: Investopedia). To minimize fraud and the overall level of crypto scams, crypto exchanges were classified as money service businesses (MSBs) back in 2019. That meant regulated entities were subject to stricter Know Your Customer (KYC) and Anti-Money Laundering (AML) rules.   What is Identity Verification? Identity Verification is the process of validating the genuineness of your customers. It involves requesting legal documents that show the authenticity and ownership of data. Typically, to enjoy and access the services that traditional financial institutions provide, KYC or identity verification process is compulsory.   The procedure requires customers, clients, or investors to submit documents such as valid ID cards, utility bills, passports, or any other legally approved documents that identifies an individual. What is Identity Verification in Crypto?   For cryptocurrency platforms, identity verification helps easily trace or track each successfully verified user. That’s what identity verification makes transactions that seem anonymous linked to real-life identities, automatically lessening the chances of fraudulent activity.   In a similar sense, platforms like Binance also limit what users that are not verified can do. After the user completes the KYC process, the platform verifies the uploaded data according to the KYC and AML rules. Onchain scammers and illicit fund siphoners have taken advantage of how the blockchain uses pseudonymous alphanumeric characters to protect users' identities. For this reason, today’s KYC processes are strengthened with human supervision and advanced proxy or phone number validations. What are the Main KYC processes? In identifying customers or clients, there are processes to consistently check for validation of data and proof of authenticity. These procedures help crypto platforms to detect incoherence in supplied data. We’ve categorized the main KYC processes down below: Customer Identification Program (CIP) This is known as the first key process to KYC. Crypto exchanges allow their users to sign up for their services and request them... --- ### AML Regulations in the USA: Everything You Should Know as a Business Owner > Learn about AML regulations in the USA and compliance processes with ongoing customer due diligence (CDD) procedures. - Published: 2022-11-24 - Modified: 2025-01-21 - URL: https://www.idenfy.com/blog/aml-regulations-in-the-usa/ - Categories: Blog, KYB/AML, Regulations by Country - Tags: Identity verification Since 2002, more than 38 institutions in USA have reached settlements or pled guilty due to non-compliance with AML regulatory requirements and paid substantial fines in settlements. A civil penalty was issued to Apple Bank by the Federal Deposit Insurance Corporation (FDIC) for violations of the Bank Secrecy Act (BSA), costing USD 12. 5 million. It was also reported that Apple Bank failed to comply with an FDIC consent order relating to the BSA anti-money laundering (AML) breaches. A money transmitter company was imposed with a fine of USD 8. 25 million, by the New York Department of Financial Services (NYDFC), due to the failure of adequate supervision of local agents, which resulted in the processing of an unusual volume of suspicious transactions. In the United States of America (USA), the financial institutions and other non-financial businesses which are required to comply with AML regulations are supervised by the Financial Crime Enforcement Network (FinCEN), which aims to safeguard the financial system from money laundering activities, through receiving, analyzing, and disseminating financial data for law enforcement purposes. This article provides an overview of the AML compliance requirements in the USA, to help you avoid possible fines and penalties due to AML regulatory non-compliances. What are the money laundering regulations in the USA? In the USA, the AML requirements are prescribed by significant laws and regulations to combat the risks of money laundering and terrorist financing. These laws and regulations are as follows: Bank Secrecy Act 1970 (BSA) The Bank Secrecy Act of 1970 (BSA) is one of the most significant AML laws and regulations in the US, which was substantially amended by the Patriot Act in 2001, and provides the basis for most of the preventative measures applied to the financial sector and other businesses. It was intended to prevent the use of secret foreign bank accounts and assist law enforcement agencies by legislating for regulatory reporting and record keeping by financial institutions. The USA Patriot Act The USA Patriot Act or just the ‘Patriot Act’ was signed by President George W. Bush on 26 October 2001, barely seven weeks after the September 11 terrorist attacks. The Patriot Act has had far-reaching consequences for financial institutions both within the US and throughout the world, and it made several significant enhancements to pre-existing US AML legislation, including obligations concerning customer due diligence (CDD) procedures for US private banking and correspondent bank accounts involving non-US persons. It introduced the need for financial institutions to have customer identification programs, known as CIPs for new customers and specifying enhanced due diligence (EDD) measures for correspondent banking and private banking customers. Money laundering Control Act of 1986 Money laundering Control Act prohibits individuals from engaging in financial transactions with proceeds generated from "specified unlawful activities SUAs”. As per law, a financial transaction includes passing money from one person to another, so long as it is done with the intent to disguise the source, ownership, location, or control of the money. Who regulates AML In the USA? Several law enforcement authorities supervise the AML regime in the USA, including: Financial Crimes Enforcement Network (FinCEN): The Financial Crimes Enforcement Network (FinCEN), delegated by the Secretary... --- ### Case Study: IPRoyal > Learn how IPRoyal is successfully verifying thousands of customers per month with iDenfy's AI-powered identity verification solution. - Published: 2022-11-23 - Modified: 2024-05-07 - URL: https://www.idenfy.com/use-cases/iproyal-idenfy-study/ - Categories: Use Cases Learn how IPRoyal reduced the time to verify new users while building a custom-tailored KYC onboarding flow. IPRoyal is a global proxy service provider that offers businesses and individuals access to a residential proxy network.   The United Arab Emirates-based company specializes in IP networking and is well-equipped to serve different proxy needs.   The Challenges IPRoyal continues to grow its global IP pool and concentrates on offering functionality through a wide range of proxies. For example, Its 4G Mobile proxies automatically rotate IP addresses to users that can utilize this type of proxy for anonymous competitor research, SEO optimization, or social media management.   According to IPRoyal, the company welcomes at least 500 new entrants daily. But the growing circle of customers who are interested in IPRoyal proxies comes with specific challenges. IPRoyal claims that maintaining such a complex system requires a lot of work and effort, not to mention accuracy and speed. As claimed by IPRoyal, they needed to enhance their security system by implementing a user-friendly identity verification solution to ensure a secure yet frictionless customer onboarding: “To maintain the safety of our network and avoid any possible harm to our infrastructure and other network users, we must ensure that every new user is identified before accessing our network,” says Karolis Toleikis, CEO of IPRoyal. “We aimed to increase conversions while maintaining a frictionless customer onboarding journey, as IPRoyal’s customers expect a quick sign-up. ” At that time, IPRoyal thought of two possible scenarios to solve this issue:  To build an in-house identity verification system and hire new employees specifically for remote KYC purposes.   To use a trusted, third-party provider to take care of the complete ID verification process. After realizing that such challenges would be solved easier by finding an ID verification provider, IPRoyal decided to give full administrative power to iDenfy’s KYC experts.   The Solution It was important for IPRoyal to work with a trusted ID verification provider to guarantee long-term collaboration. Beyond the KYC requirements and the aim to stop fraud, IPRoyal had three factors in mind that would meet their team’s and customers’ expectations: efficient verification flow, powerful UX, and easy integration. With the growing proxy user network, IPRoyal integrated iDenfy’s four-step verification to speed up the sign-up procedure for every proxy user who expected to receive a pain-free registration.   iDenfy ticked all the boxes and fulfilled IPRoyal’s requirements. IPRoyal partnered with iDenfy in July 2022 with the hopes of creating a speedy and simple customer onboarding process. The company chose iDenfy as its ID verification provider to ensure a frictionless and secure onboarding experience.   “iDenfy helped us save valuable resources, and, more importantly, we know our identity verification process works as intended, offering a seamless experience for our clients and us. ” Karolis Toleikis, CEO of IPRoyal The Results iDenfy’s identity verification plugin, powered by artificial intelligence and biometric authentication technology, simplifies operational difficulties. The automated process helps IPRoyal detect fake identities and restrict suspicious customers from accessing its proxy services. With iDenfy, IPRoyal successfully onboards more than 1, 200 applicants a month. Without iDenfy’s... --- ### Frauds in NFTs And The Need For KYC > Learn about NFTs and why identity verification powered prevents online fraud and builds trust. Click to find more. - Published: 2022-11-15 - Modified: 2025-01-21 - URL: https://www.idenfy.com/blog/frauds-in-nfts-and-the-need-for-kyc/ - Categories: Blog, Identity Verification - Tags: Identity verification NFTs are believed to be the web3 technological tool that would change the internet economy. While web3 believers have high hope for what NFTs will become, the fraudsters of the internet are making moves in every way to outsmart creators, collectors, and investors. In February 2022, an Opensea phishing attack made more than 17 people lose millions in NFTs. Every day, crafty fraudsters make NFTs seem unsafe for noobs, experienced investors, professional creators, and native web2 users. So, a good understanding of what NFT frauds can be, how to play safe, and an understanding of KYC must be known by all NFT enthusiasts. What are NFTs? Non-fungible tokens, NFTs for short, are digital collectibles with unique attributes that can be owned by one person at a time. They are digital assets that lie on the blockchain representing an underlying property. NFTs can be anything from music files, art, gaming assets, tweets, poems, pictures, videos, gifs, memes, etc. As long as they are digital files that can be minted on a blockchain. NFTs are rare and unique. All NFTs are different from each other, they contain varying metadata that differs them. Just like how two houses of the same structure differ from each other due to location. The use of NFTs today has gone far from just being ordinary art on the blockchain to having extensive use cases; some examples involve tickets in events, accesses into the metaverse, and tradeable collectibles in games, and they can be used for IRL properties such as houses, cars, and valuables. Evolution of NFTs The year 2021 was tagged "The Year of NFTs", Beeple's historical sale, Facebook's rebrand into Meta, increase in NFT as a keyword search, gaming assets, e. t. c, all led to the boom of NFTs ATH of 1785%. While 2021 was a year for NFTs, it had been in existence before the Ethereum blockchain.   The idea of Non-fungible tokens was ignited in a paper by Meni Rosenfeld, president of the Israeli Bitcoin foundation in 2012, and was later co-authored by Yoni Assia, Vitalik Buterin, Lior Hakim, and Rotem Lev in 2013. The colored coins concept was to make cryptocurrencies perform special duties such as issuing shares by a company, giving access to events, casting a vote, e. t. c. The concept of colored coins could not stay long, as it was limited due to the inefficiency of the Bitcoin blockchain, but it led to the invention of NFTs. Other projects, such as Quantum, came up on the Namecoin blockchain, which became the first NFT minted by Kevin McCoy. The history narrows down to the Ethereum blockchain, an open-source system that allows developers to build smart contracts on it.   NFTs came into the mainstream in the year 2017- 2020 with projects like Cryptopunks and Cryptokitties, which brought a new definition to what NFTs are. The NFTs on the Ethereum blockchain were built following proposed token standards referred to as ERCs- Ethereum Request for Comments. The standards define the attributes of each token and their on-chain behavior. These NFTs became the talk of the town when Cryptopunks, a 10,000 PFP NFT collection initially distributed for free, started selling for a mouth-watering price, with the lease cost being $ 1 million at the time. Cryptokitties... --- ### How to Verify Proof of Address in 2025? Here’s the Complete Guide > What are acceptable forms of proof of address? How to verify your proof of residency? We answer all these questions in our guide to PoA. - Published: 2022-11-08 - Modified: 2025-01-22 - URL: https://www.idenfy.com/blog/proof-of-address-poa/ - Categories: Blog, KYB/AML How exactly does the proof of address process look like? Our step-by-step guide will answer all questions related to Address Verification. Proof of address (PoA) has a vital role in identity verification. Companies request proof of address documents as part of the due diligence procedure and verification obligations regarding Anti-Money Laundering (AML) compliance. Typically, a customer verifies their identity by taking a photo of their ID document. Despite that, there are cases when businesses are obliged to dig deeper and ask their clients to provide proof of address information. This is where the challenges begin. So, what documents are accepted as proof of address, and when is it mandatory to proceed with PoA check? Keep on reading to find out. What is Proof of Address? Proof of Address (PoA), also sometimes referred to as proof of residence, is evidence that companies use to verify a person’s residential address. Due to Know Your Customer (KYC) and AML requirements, regulated entities, like bans and crypto platforms, are required to ask the users to upload their proof of address during the onboarding process.   Accepted proof of address documents include utility bills, credit card or bank account statements, government tax letters, and other similar documents.   In simple words, it's exactly what it sounds like. Proof of address proves that the customer who provided the document lives in the registered location. For instance, financial institutions ask clients to verify their identity and provide proof of address if they want to open a bank account. That’s why PoA measures keep customers’ funds and identities safe.   A valid proof of address must have the user’s full name. The document should also show their current residential address, match their ID document, and be issued by a recognized official authority.  Once proof of address documents, such as bank statements or utility bills, are collected, they require manual or semi-manual review. This way, businesses that fall under AML regulations can prevent restricted residents from accessing their services more efficiently.   Use Cases of Proof of Address Verification As part of the compliance process specified by AML laws, customers must provide PoA documents as evidence to prove their residential address when: Performing transactions. In cases when customers exceed a specified threshold, which is determined by AML obligations. Registering for financial services. During the onboarding process, the client can be asked to provide an extra proof of address document as part of the AML compliance process.   Restricting account openings. There are regional compliance requirements that determine restrictions for customers living in high-risk regional areas and countries. Checking their proof of address ensures compliance and prevents fraud. Additionally, there are other benefits to proof of address verification. Finding out where a person lives helps when a company wants to send physical documents, especially in legally challenging situations. For example, when the bank is obliged to contact the customer physically. Related: Address Verification Explained How Does Proof of Address Work? Common proof of address processes work by implementing optical character recognition (OCR) into their systems. This technology enables accurate and fully automated address data collection, extraction and verification. Often, the user’s... --- ### Case Study: PROFI CREDIT > Check out how, with iDenfy, PROFI CREDIT managed to enhance customer onboarding and shorten the verification time via an AI-powered solution. - Published: 2022-11-03 - Modified: 2024-05-07 - URL: https://www.idenfy.com/use-cases/profi-credit-idenfy-study/ - Categories: Use Cases Discover how PROFI CREDIT enhanced its anti-fraud system and simplified access to its financial services by integrating iDenfy's identity verification software. PROFI CREDIT is one of the biggest non-banking lenders in Poland, providing accessible loans to a wide range of consumers. The company noticed an increasing number of fraudulent attempts to sign fraudulent contracts. To combine both efficiency and security, PROFI CREDIT started to look for an automated identity verification solution. The Challenges When it comes to traditional financial institutions, loan applications can take weeks, and maintaining excellent credit is one of the challenges clients face when trying to secure a loan. PROFI CREDIT aimed to minimize the struggle by increasing the chances of getting a loan approved. Additionally, PROFI CREDIT needed to find a way to maintain the highest level of security without compromising on user experience. By providing its clients access to their funds almost instantly, PROFI CREDIT offers much quicker financial solutions than traditional institutions. Naturally, to maintain a quick loan application process, PROFI CREDIT had to implement a user-friendly identity verification solution. The company’s approach to fraud prevention assesses the risks from different channels, ensuring that the clients and their assets are secured. Before implementing automatic ID verification, PROFI CREDIT's main goal was to recognize fraud attempts and apply effective measures to prevent them. "Our customers expect safe and quick lending services, which puts us in a challenging spot," says Jaroslaw Czulak, Chief Marketing Officer of PROFI CREDIT. "We knew that the new KYC service would benefit our business and the whole fraud prevention package. With iDenfy, we’ve managed to reach this goal and exceed expectations. ” Moreover, PROFI CREDIT wanted to add an extra layer of security and implement an ID verification solution to ensure compliance with Know Your Customer (KYC) regulations when welcoming clients. The Solution PROFI CREDIT selected iDenfy because of the easy-to-use dashboard and all of the KYC compliance tools in one place. iDenfy’s efficiency and cost-effective verification process secured the decision for the partnership. “A critical factor in ensuring customer satisfaction is a secure KYC process. iDenfy’s digital onboarding solution is not only safe but also scalable. We can approve many customers without making it necessary to meet in person," explained Jaroslaw Czulak, CMO at PROFI CREDIT. Currently, the sign-up process takes less than a minute: iDenfy’s fully automated, AI-powered engine is based on the zero-fraud policy, and it’s backed up by real-time human supervision. iDenfy’s four-step ID verification guarantees a smoother onboarding experience for PROFI CREDIT’s customers. iDenfy’s algorithms use phone or PC cameras, making it easy for customers to take a selfie and a photo of their identity documents. The advanced image scanning technology and Liveness Detection ensure that the user is physically present. iDenfy matches the person’s face with the document and cross-checks the details with various databases to ensure accuracy for PROFI CREDIT. All financial industry players are obliged to know their customers properly. iDenfy removed the challenge of the ever-changing compliance landscape. Now, the fraud prevention business secures PROFI CREDIT’s data throughout the full course of the business relationship. The Results PROFI CREDIT cast around independent identity verification... --- --- ## Glossary ### Know Your Seller (KYS) > Learn about Know Your Seller (KYS) verification, common types of seller fraud, popular marketplace scams, and how to prevent them. - Published: 2025-04-22 - Modified: 2025-04-22 - URL: https://www.idenfy.com/glossary/know-your-seller-kys/ Know Your Seller (KYS) is the process of verifying seller identities on online marketplaces and similar e-commerce platforms to ensure security and the integrity of transactions, guaranteeing that sellers are genuine. Common methods of verification include document ID verification, selfie verification, among other methods used in the traditional Know Your Customer (KYC) process. The goal of KYS verification is to prevent criminals from opening new accounts and engaging in illicit activities, such as marketplace fraud. By asking the seller to upload their ID and complete a quick biometric check, online marketplaces ensure that sellers aren’t creating multiple accounts. Multi-accounting often goes against the rules, and is considered to be closely linked to other fraudulent practices, such as selling inauthentic items on the marketplace, conducting account takeovers, and similar activities. While Know Your Seller is a legal requirement in many regions, some platforms also use it to minimize risks and protect their reputation. --- ### Telemedicine Verification > Learn about telemedicine verification to find out how it's linked to a standard KYC process, helping prevent fraud while ensuring security. - Published: 2025-04-16 - Modified: 2025-04-16 - URL: https://www.idenfy.com/glossary/telemedicine-verification/ Telemedicine verification is a form of assessment verifying that the person accessing health-related services remotely is real via some sort of technology, such as automated identity verification software. This process is often used on healthcare apps and other forms of telemedicine, such as remote pharmacy subscription services. Telemedicine verification is linked to similar tech and medical offerings that happen online and require strict ID verification measures due to Know Your Customer (KYC) or Know Your Patient (KYP) regulations. With AI and its automation tools, such as ChatGPT, the demand for more convenient services and faster access to services or certain information rose quickly, impacting the healthcare industry as well. Virtual healthcare apps, such as platforms for doctors providing consultations or medicine subscriptions, are required to be verified to ensure secure, transparent, official services that focus on preventing fraud, for example, posers faking their qualifications to offer “medical” advice online. --- ### Know Your Vendor (KYV) > Access the key FAQs linked to the Know Your Vendor (KYV) process and find out how this sort of due diligence helps protect your supply chain. - Published: 2025-04-10 - Modified: 2025-04-10 - URL: https://www.idenfy.com/glossary/know-your-vendor-kyv/ Know Your Vendor (KYV) is a set of due diligence measures designed to verify another company. This is an umbrella term for Know Your Business, or KYB, specifically targeting the company’s vendors or suppliers that are being verified to check if they’re legitimate: the operations are transparent, ownership structure is clear and that there aren’t any sanctions compliance violations, among other factors, that go into a KYV check. The KYV process helps mitigate risks associated with third-party partnerships, such as potential non-compliance, financial loss, and reputational damage. A robust Know Your Vendor program consists of an internal risk assessment and multiple automation tools that help identify, assess, and actively manage the company’s vendor relationships. Ultimately, KYV helps businesses decide if it’s worth starting a new business relationship with a particular vendor. That’s because most entities want to avoid high-risk vendors and establish a long-term, sustainable, and mutually beneficial partnership. --- ### Decentralized Finance (DeFi) > Learn all about Decentralized Finance (DeFi): if it's a safe option, how it differs from CeFi and the endless opportunities that come with it. - Published: 2025-04-08 - Modified: 2025-04-08 - URL: https://www.idenfy.com/glossary/decentralized-finance-defi/ Decentralized Finance (DeFi) is a peer-to-peer (P2P) financial system built on blockchain and cryptocurrencies. Blockchain technology operates as a ledger that records all transactions in real-time. This allows online platforms that use decentralized technology to provide financial services, like loans, payments, and interest-bearing deposits, without depending on traditional intermediaries, aka banks. Ultimately, the DeFi infrastructure aims to reduce costs and operational delays because it cuts out the “middlemen” by offering direct, peer-to-peer transactions. Without intermediaries who charge for their services, DeFi uses blockchain technology. For example, if Person A sends money to Person B, that transaction is permanently timestamped and added to the blockchain. That’s how it’s possible for users to access familiar financial services without relying on traditional financial institutions. --- ### Magic Link > Discover what a Magic Link is, how it works, and how this feature helps automate user onboarding and other identity verification processes. - Published: 2025-04-08 - Modified: 2025-04-08 - URL: https://www.idenfy.com/glossary/magic-link/ A Magic Link is a feature used for authentication purposes, often to enhance the identity verification process, which is used in high-risk sectors to comply with Know Your Customer (KYC) requirements online. The magic link redirects the user to perform the ID verification via methods like a one-time, time-sensitive code sent via email or SMS, among other methods, such as APIs that generate codes through push notifications and other customizable methods. Most magic link features are convenient for the end-user because they are passwordless and don’t require the person to enter their full name or date of birth, for example, manually. These details are automatically extracted from their ID document, and, optionally, a selfie check where their biometrics are matched is implemented. So, the term “magic” is used on purpose to showcase that the user is instantly logged in once they click the link to prove their identity, as if magic was used. --- ### Real-World Assets (RWAs) > Physical or tangible assets can be tokenized, and this is how the concept of Real-World Assets (RWAs) was born. Access the key FAQs. - Published: 2025-04-07 - Modified: 2025-04-07 - URL: https://www.idenfy.com/glossary/real-world-assets-rwas/ Real-World Assets (RWAs) are tangible assets (for example, a digital token for gold) used in the blockchain space. Tangible means that something is used in a digital form, but it also exists outside the digital world, such as currencies, equities, communities, and bonds. In other words, RWAs mirror physical financial assets. In the digital asset industry, RWAs are becoming popular, and more projects like bringing cash into the blockchain system are coming to light. In theory, anything can be turned into an RWA and brought into the blockchain ecosystem, but it needs to have value, for example, like real estate. RWAs are considered to be a potentially good investment and market opportunity in blockchain. However, some jurisdictions still lack regulatory compliance rules for real-world assets, and, for this reason, despite RWAs presenting potential benefits and transparency, this industry has its challenges. --- ### Bank Verification API > Look through the main functionalities and benefits of popular bank account verification API solutions, and why this approach might be useful for you. - Published: 2025-04-01 - Modified: 2025-04-01 - URL: https://www.idenfy.com/glossary/bank-verification-api/ Bank verification API (Application Programming Interface) is an open banking solution used for verifying account ownership and ensuring that the customer’s personal details match with their bank account records. Such API is often used in fintech and other financial industries where firms deal with financial transactions and are required to conduct Know Your Customer (KYC) verification. A typical Bank verification API is used to automate both bank account and identity verification processes, making it more efficient for financial institutions to comply with regulatory requirements and still ensure a good experience for the end-user who’s signing up on their platforms. --- ### Fraud Scoring > Learn how a fraud scoring system works, why it's vital for different industries, and how AI lets you calculate fraud scores more accurately. - Published: 2025-03-31 - Modified: 2025-03-31 - URL: https://www.idenfy.com/glossary/fraud-scoring/ Fraud scoring is an automated process that is often linked to an AI-powered fraud prevention software that’s designed to calculate an estimated fraud score or the likelihood of a user being a fraudster based on several factors, such as their IP address or credit card data. This depends on the particular use case, but in general, fraud scoring is popular in fintech, e-commerce, and other industries where online fraud is an issue. Fraud scoring works as a real-time alert, pinpointing useful data automatically. For example, if a new user attempts to register an account with blacklisted or stolen credentials, the fraud scoring system shows a high likelihood of fraud (a high score), automatically rejecting the user from the platform or, alternatively, flagging the user for extra manual review. Fraud scoring is often part of a bigger fraud prevention system that a company uses for its Know Your Customer (KYC) and anti-money laundering (AML) obligations. --- ### Liveness Detection > Learn all about liveness detection, the difference between passive and active liveness checks, and how it's part of the biometric verification. - Published: 2025-03-31 - Modified: 2025-03-31 - URL: https://www.idenfy.com/glossary/liveness-detection/ Liveness detection is an AI-based technology that is designed to verify an individual remotely using their biometric traits, such as iris, skin texture, and the face in general, to confirm that the person is real and actually present during the selfie verification process. In other words, it detects fraudulent attempts to bypass the Know Your Customer (KYC) verification process, such as facial masks or spoofing, and automatically checks if the submitted identity data represents a real person. Some systems that use liveness detection prompt users to make extra movements, for example, asking them to blink or smile, as a way to take security measures even further. Various industries, not just banking, use liveness detection in their identity verification process. This includes the sharing mobility sector, cryptocurrency, iGaming, real estate, and other high-risk regulated industries that require the verification of new users at the account creation stage. Since liveness detection is seamless, it ensures a smooth process without adding unnecessary friction for the end-user. --- ### SSN Verification > Learn why people misuse SSNs for fraud, how they're linked to money laundering, and why SSN verification goes along with other KYC methods. - Published: 2025-03-25 - Modified: 2025-03-25 - URL: https://www.idenfy.com/glossary/ssn-verification/ SSN verification, or Social Security Number (SSN) verification, is the process of checking if a person’s SSN is legitimate and not forged, typically paired with other Know Your Customer (KYC) processes, such as a standard ID document check, which is mandatory in many regulated industries. This process helps ensure compliance and maintain accurate risk profiles or data about a person in general. An SSN is useful in both traditional finance, where it helps verify that an individual opening an account isn’t fraudulent, and in employment screening, where it confirms valid work visas and other necessary documents. It also plays a vital role in other verification scenarios and similar cases where SSNs are used as data points for cross-referencing the person’s personal details with internal or external databases as a way to ensure their legitimacy. This serves as a fraud prevention measure. --- ### Chip Dumping > Find out all about chip dumping, its use cases in poker, multiple account fraud, bonus abuse, and other vital nuances, such as if this scheme is legal. - Published: 2025-03-24 - Modified: 2025-03-24 - URL: https://www.idenfy.com/glossary/chip-dumping/ Chip dumping is an illicit practice in iGaming and gambling where a player deliberately loses chips or credits to another person. This is a tactic designed to forward the funds later to another recipient, who can be a colluding partner or simply a duplicate account controlled by the same player. In this case, the fraudster creates fake accounts designed to lose intentionally to a specific, pre-determined account, effectively dumping the chips there. This fraudulent practice is common in poker but can be used in other games. --- ### Rug Pull > Find out what a rug pull is, how crypto scammers trick investors, and why does this scheme continue to be popular in the digital asset space. - Published: 2025-03-24 - Modified: 2025-03-24 - URL: https://www.idenfy.com/glossary/rug-pull/ A rug pull is a common exit scam in the cryptocurrency industry where a team convinces investors to raise money for a publicly sold token with the intention to deceive and quietly shut down the whole project and disappear with all the funds. Once this happens, the tokens are worthless, and the investors become victims without any portion of the funds since they all were stolen. While rug pull scams aren’t a new thing, they still attract victims and are backed by hyped social media campaigns and huge influencers as a way to deceive investors and promise buyers “exclusive” digital assets. Rug pulls often happen on decentralized exchanges (DEXs), where fraudsters use the platform's increased anonymity to hide their identities and avoid detection. Rug pulls are also considered a complex crime because they are heavily orchestrated and well-thought-out, and to succeed, they need to build credibility, which often takes months of work and convincing, including certain finances for marketing or luring in investments. --- ### Collusion in iGaming > Learn how player collusion works in iGaming, which online games are used for fraudulent schemes most, and what kind of tools are used for prevention. - Published: 2025-03-21 - Modified: 2025-03-21 - URL: https://www.idenfy.com/glossary/collusion-in-igaming/ Collusion in iGaming occurs when two or more players unethically cooperate in a game to cheat the system and gain an unfair advantage. This practice is common in the gambling and iGaming industry, for example, in poker tables. Collusion can be mixed up with other fraudulent schemes, such as proxy use or chip dumping, which are all designed to compromise the game. The main goal of collusion is to manipulate the odds in favor of the players involved and secure bigger winnings. This type of fraud is also sometimes linked to more serious crimes and can lead to money laundering. --- ### Company Verification > Learn what kind of checks should be included in your company verification process, a vital tool for determining another company's legitimacy. - Published: 2025-03-07 - Modified: 2025-03-07 - URL: https://www.idenfy.com/glossary/company-verification/ Company verification, also known as business verification, is the process of confirming another company’s legitimacy, checking if it’s genuine and compliant and not involved in any illegal activity, such as fraud, sanctions evasion, or money laundering. Many financial institutions and other regulated businesses use company verification as part of their Know Your Business (KYB) compliance obligations. This process involves assessing various documents, including the company's financial background, business registration data, and ownership structure, such as current and past directors, ultimate beneficial owners (UBOs), and other checks that can show how the company is operating. The main goal of company verification is to prevent fraud and determine whether it’s worth starting a business relationship or, in other words, whether it's safe to do business with that entity. For example, investing in a business without doing due diligence is risky. The same principle applies to all third-party vendors that you work with; they need to be verified and assessed through company verification as part of your business’s internal risk assessment process. --- ### Optical Character Recognition (OCR) > Learn all about Optical Character Recognition (OCR), where it's used, how different industries implement this technology, and how it's linked to KYC. - Published: 2025-03-02 - Modified: 2025-03-02 - URL: https://www.idenfy.com/glossary/optical-character-recognition-ocr/ Optical Character Recognition (OCR) is a special technology that automates data extraction and verification by converting images of text into machine-readable text. OCR document verification technology captures identifiable customer information (such as their name, date of birth, etc. ) for authentication. That’s why it’s widely used in ID verification and Know Your Customer (KYC) compliance due to being a swift and reliable way for authentication among various cases, such as border control or before opening an account in a bank. OCR technology for KYC automates data extraction from personal ID documents, such as passports or ID cards, to verify a person’s identity, often adding other layers of verification, for example, checking against relevant watchlists or cross-checking with government databases. By powering AI, Machine Learning (ML), and OCR, KYC software can efficiently classify and interpret data from various documents, enhancing both accuracy and effectiveness in the user onboarding process. --- ### MRZ Code > Explore the key insights regarding the MRZ code, its use cases, how such encrypted data is linked to identity verification, and more. - Published: 2025-03-02 - Modified: 2025-03-02 - URL: https://www.idenfy.com/glossary/mrz-code/ The MRZ code, also known as the Machine Readable Zone code, is a combination of letters, numbers, and symbols that consist of three lines on the bottom of a passport. This section is a security measure designed to simplify the automatic reading of identity documents. That’s because it encodes the document holder's information, enabling fast and secure processing of personal details. The MRZ code is a vital component of the identity verification process used in various cases, for example, to verify financial transactions, to confirm a user’s identity before they open a new account, in border control, airport security, and so on. --- ### Age Assurance > Learn about the age assurance process, its requirements in different jurisdictions, and which factors make it unique compared to estimation. - Published: 2025-02-28 - Modified: 2025-02-28 - URL: https://www.idenfy.com/glossary/age-assurance/ Age assurance is the process of incorporating various tools to determine a person’s age, typically referred to cases when an online platform needs to verify a possibly underage individual’s age and date of birth remotely due to offering age-restricted items or services. For example, this can be an e-commerce site selling tobacco items or a social media platform, which only allows users of a certain age to create an account there. This way, it restricts minors from accessing items or content online that could be harmful for this age group. Some age verification systems, for example, can extract a user’s date of birth from their uploaded ID document and verify whether it meets the platform’s requirements. However, the age assurance process can be customized to each business and its specific use case, often incorporating more advanced measures, not just document verification. This is required to ensure compliance with data protection and safety regulations, such as the ICO’s Children’s Code or Ofcom’s guidelines. --- ### Employment Verification > Learn about the process of employment verification, and how it can negatively affect entities that don't use proper ID verification measures. - Published: 2025-02-26 - Modified: 2025-02-26 - URL: https://www.idenfy.com/glossary/employment-verification/ Employment verification is the process of running a background check and verifying the identity of a potential job candidate to confirm whether their identity, including vital information like previous job log, aligns with their provided information. This means the business needs to ensure the person is truthful and genuine about their persona. This is vital, as AI is getting more mainstream and is often used to forge documents (especially for work visas or other benefits) or, in less severe cases, to deceive the business about their work experience. Verifying applicants through a proper employment verification process helps businesses check if the applicant doesn’t lie about their job titles, responsibilities, duration of employment, and overall representation of their stated qualifications. It’s common for applicants to hide their terminations or frequent job-hopping. However, industries with higher risks, such as sensitive data or a high volume of financial transactions, need to conduct this check to ensure compliance with laws like the Know Your Employee (KYE) program. In this sense, employment verification is part of such a program, which includes identity verification during hiring and onboarding. --- ### End-to-End KYC Process > Learn what makes end-to-end KYC so special and how it differs from the traditional KYC or identity verification process in different sectors. - Published: 2025-02-25 - Modified: 2025-02-25 - URL: https://www.idenfy.com/glossary/end-to-end-kyc-process/ An end-to-end KYC process, or end-to-end Know Your Customer, is a unified approach to KYC compliance, which is based on a holistic approach to identity verification. In essence, end-to-end KYC simplifies and automates not one but many aspects of KYC, including the initial onboarding stage, customer due diligence, and ongoing monitoring. By adopting an end-to-end KYC process, companies can also ensure anti-money laundering (AML) compliance while focusing on another major aspect — user experience. The need for end-to-end KYC solutions became more evident after more stringent KYC requirements were introduced in several sectors. This meant that not only banking and finance needed to implement KYC or AML measures, but also other important companies operating in iGaming, travel, healthcare, crypto, insurance, etc. Additionally, with vast amounts of data and different documents that need to be verified and assessed, manual processes became ineffective, and obligated entities quickly turned to automation and end-to-end KYC compliance solutions. --- ### VAT Validation > Access the main facts about VAT validation, finding out why financial institutions in the EU use this lookup method in KYB verification. - Published: 2025-02-24 - Modified: 2025-02-24 - URL: https://www.idenfy.com/glossary/vat-validation/ Value-added tax validation, or more commonly referred to as VAT validation, is a security process designed to check another company’s VAT number, verifying that it’s valid and the business operates legally. This is equivalent to EIN verification, or the Employer Identification Number (EIN) validation in the US, but used within the EU. All EU member states impose a VAT on items sold in the EU, and it’s strongly recommended that companies operating in this area or working with EU-based businesses validate VATs to ensure compliant, fraud-free transactions. --- ### KYC Verification > Learn about KYC verification, what measures are commonly used by banks, and why some institutions require more stringent checks than others. - Published: 2025-02-24 - Modified: 2025-02-28 - URL: https://www.idenfy.com/glossary/kyc-verification/ KYC verification, or Know Your Customer verification, is a regulatory compliance procedure requiring banks, fintechs, crypto businesses, and other high-risk industries to verify and check customers’ identities, typically during the account creation process and later after their initial verification to maintain accurate KYC risk profiles. The most common forms of KYC verification include document checks, where the company asks the user to provide their government-issued ID document, and selfie verification, which includes a short recording of their face, aka biometrics, to see if they match with the portrait on the ID document. More stringent verification measures also include Anti-Money Laundering (AML) measures, such as screening against Politically Exposed Persons (PEPs) lists and sanctions lists, including global watchlists and adverse media. This is part of the company’s ongoing compliance efforts. In simple words, KYC verification verifies a client’s identity when opening an account and, at regular intervals, confirms that customers are who they claim to be. --- ### Rental Fraud > Learn how rental fraud works, why it's vital to have a tenant screening process, and how not to get caught in this sort of scam. - Published: 2025-02-14 - Modified: 2025-02-14 - URL: https://www.idenfy.com/glossary/rental-fraud/ Rental fraud is an illegal practice where bad actors pose as rental agents or property owners to fake listings and deceive genuine renters who are looking into real estate. Often, scammers contact victims online using low prices and asking for upfront payments. They claim such terms are required for the person to secure the rental property. Alternatively, bad actors ask for personal information to later use it for identity theft and other financial crimes. --- ### Employer Identification Number (EIN) > Learn about Employer Identification Number (EIN), its verification practices, why EINs are a big part of KYB compliance, and more. - Published: 2025-02-12 - Modified: 2025-02-12 - URL: https://www.idenfy.com/glossary/employer-identification-number-ein/ The Employer Identification Number (EIN) is a unique nine-digit number formatted as XX-XXXXXXX and used in the US for identification, employment and tax reporting purposes. The IRS assigns an EIN for a business for identification. That’s why EINs help the IRS identify businesses for tax reporting. In the general tax identification context, an EIN can also be called a Taxpayer Identification Number (TIN). A business can apply for an EIN for tax administration through the IRS online. Having an EIN also means the business can open a bank account or apply for credit. --- ### Tax Fraud > Learn the deceptive practices individuals and businesses use to hide their income and find out how they succeed with tax fraud. - Published: 2025-02-11 - Modified: 2025-02-11 - URL: https://www.idenfy.com/glossary/tax-fraud/ Tax fraud is a deliberate deception used by both individuals and businesses to intentionally falsify tax returns and gain an unlawful advantage. It involves misrepresentation of truth as a tactic to manipulate others and earn funds. For example, tax fraud includes misreporting personal expenses, claiming false deductions, faking a Social Security Number (SSN), or simply failing to report income on purpose. Tax fraud can result in both monetary and jail time penalties. It works when fraudsters misrepresent information on tax returns with the goal of reducing liability. This is a huge issue for the general financial system as the government struggles to identify or prove tax fraud. Sometimes, tax fraud is linked to tax avoidance, where the line between legal and illegal practices can be thin. If a taxpayer has a reasonable legal argument, they can often avoid criminal charges. --- ### NIS2 Directive > Access the latest insights regarding the EU's new cybersecurity framework, the NIS2 Directive, and see all FAQs in one place. - Published: 2025-02-06 - Modified: 2025-02-06 - URL: https://www.idenfy.com/glossary/nis2-directive/ The NIS2 Directive or Network and Information Security Directive, also referred to as Directive (EU) 2022/2555, is a new EU cybersecurity legislative framework designed to prevent emerging security threats by increasing new grounds on network security and information systems. It provides regulatory rules and unified requirements by expanding the original NIS Directive’s scope. NIS2 became effective on October 17, 2024. Under the Directive, regulated entities must implement technical, operational, and organizational measures to manage various cybersecurity risks. This involves assessing how NIS2 impacts the company’s current internal cybersecurity practices and developing a compliance plan that helps minimize the impact of incidents on services and interconnected systems. --- ### Tax Identification Number (TIN) > Learn the structure and factors that make up a valid TIN, or Tax Identification Number, required for US-based entities and individuals. - Published: 2025-02-06 - Modified: 2025-02-06 - URL: https://www.idenfy.com/glossary/tax-identification-number-tin/ A Tax Identification Number (TIN), sometimes referred to as a Federal Taxpayer Identification Number (FTIN), is a unique identifying nine-digit number used by the US Internal Revenue Service (IRS) to identify taxpayers. A TIN can identify individuals, corporations, and other entities, including nonprofit organizations (NPOs). In general, anyone required to file annual tax returns with the IRS has to have a TIN. It’s also mandatory when managing a business or handling other financial matters. --- ### Argentina Age Verification > Curious about the foreign country age verification system? Argentina's age verification law is quite interesting. - Published: 2025-02-04 - Modified: 2025-02-04 - URL: https://www.idenfy.com/glossary/argentina-age-verification/ Argentina Age Verification is a law designed to ensure that users accessing certain online services, such as gambling platforms, are of legal age and no underage or unauthorized users would use these sites. Argentina implemented this law in December 2024, and since then, Argentina's users who want to use online gambling services have had to do ID and biometric verification. Additionally, the law introduces a nationwide ban on all gambling advertisements, mainly to limit exposure for younger audiences. Also, Argentina introduced Bill 2370-D-2023 in June 2023 to protect children’s data and privacy in digital space and platforms by requiring digital service providers to add age verification to ensure compliance with privacy laws. Of course, not every platform can implement such measures, so in that case, they have to apply proper and highest privacy standards to all users, not just minors - the aim here is to have the highest privacy standards, with or without age verification. --- ### Asset-Referenced Token (ART) > Learn all about asset-referenced tokens - a cryptocurrency whose value is tied to fiat currency and does not change. - Published: 2025-01-31 - Modified: 2025-01-31 - URL: https://www.idenfy.com/glossary/asset-referenced-token/ Asset-Referenced Token (ART) is a cryptocurrency or digital token type whose value is tied to fiat currencies, commodities, or other cryptocurrencies and does not change. Unlike stablecoins, which are pegged to a single and only one asset, for example, the most common is USD, ARTs derive their value from multiple reserves, reducing reliance on any one asset. They are used in decentralized finance (DeFi), payments, cross-border transactions, and many more services while at the same time mitigating volatility. ARTs are like a connection between traditional finance and blockchain ecosystems, most suitable for users who are seeking stability without putting crypto’s efficiency away. ARTs also minimize the risks by referencing multiple assets associated with single-point failures, such as a currency devaluation or commodity price crash. However, ARTs are a complex currency, so they demand rebalancing, liquidity, and legal adherence management quite often. --- ### First-Party Fraud > Explore the main forms of first-party fraud, and find out how it differs from other, more traditional forms of fraud, like identity theft. - Published: 2025-01-26 - Modified: 2025-01-26 - URL: https://www.idenfy.com/glossary/first-party-fraud/ First-party fraud is a deceptive practice where criminals provide fake information, such as promises to repay for goods or services, or altered identity information to scam other individuals or businesses as a way to gain some sort of benefit. Different from other more traditional types of fraud, which often involve stealing another person’s identity, first-party fraud happens when the bad actor poses as a legitimate customer. For example, this can involve a person applying for a new credit card that they don’t plan on repaying or forging their financial background and claiming they have good financial standing before applying for a loan. There are cases when first-party fraud is linked to money mules or people who other criminals use, often more skilled money launderers, as a front. The mule provides their legitimate information (with a good, clean background) and then obtains a credit or continues with other fraudulent operations and earns a commission for their “services. ” --- ### Digital Services Act (DSA) > Access the latest insights on one of EU's laws, or the Digital Services Act (DSA), and know the steps that will help you to stay compliant. - Published: 2025-01-26 - Modified: 2025-01-26 - URL: https://www.idenfy.com/glossary/digital-services-act-dsa/ The Digital Services Act (DSA) is an EU law designed to govern online platforms and “intermediaries,” such as social media platforms, search engines, app stores, or online marketplaces, aiming to increase transparency by mandating reporting from tech companies and increasing greater accountability regarding online operations. DSA aims to address online harms such as harassment or disinformation and applies to all EU member states. The Digital Services Act also seeks to create a unified approach to smooth operations for online platforms by establishing standard rules and responsibilities through regulatory standards. Additional rules apply to platforms classified as “very large” (for example, those with more than 45 million monthly EU users). This regulation takes full effect across the EU states starting February 17, 2024. --- ### Email Verification > Learn how email verification works, why it's linked to Know Your Customer (KYC) compliance, and how it's safer than simple passwords online. - Published: 2025-01-25 - Modified: 2025-01-25 - URL: https://www.idenfy.com/glossary/email-verification/ Email verification is a process designed to check if the person’s email is active and valid, as well as if it actually belongs to the person conducting this process. It’s similar to other verification measures, such as phone verification, where the principle is the same, but the identifying data point differs. Email verification is widely used as a fraud prevention tool across financial institutions or industries like e-commerce, where the risk of fraud is higher. It helps combat issues such as account takeovers, multi-accounting, and other activities that violate platform guidelines. --- ### Sanctions Check > Learn why it's important to do a sanctions check and screen different sanctions databases before starting a new business relationship with any client. - Published: 2025-01-21 - Modified: 2025-01-21 - URL: https://www.idenfy.com/glossary/sanctions-check/ A sanctions check is the process of checking or screening various global sanctions lists to ensure that the customer isn’t sanctioned. Regulated businesses, such as banks, must conduct such checks to ensure that all their potential customers (both individuals and other companies) don’t have any ties to sanctions against them. The goal is to check clients against official lists of sanctioned parties from governments or international organizations, reducing financial and legal risks. Sanctions checks are part of a compliance process required by Anti-Money Laundering (AML) and counter-terrorist financing (CTF) laws. By screening these lists, companies aim to prevent partnering with dangerous entities, such as those involved in illegal activities like terrorism, drug trafficking, or human rights abuses. This makes the sanctions screening a number one defense against individuals and entities or countries considered a risk to peace and national security. --- ### Know Your Investor (KYI) > Discover what qualifies someone for specific investor statuses and learn about the Know Your Investor (KYI) verification process. - Published: 2025-01-17 - Modified: 2025-01-17 - URL: https://www.idenfy.com/glossary/know-your-investor-kyi/ Know Your Investor (KYI) is an identity verification process, or a sub-measure of the standard Know Your Customer (KYC) verification process, focusing on verifying the personal information of investors before starting a business relationship with them. It involves various procedures designed to confirm the legitimacy of potential investors. KYI verification also works as a fraud prevention measure, helping regulated entities, such as fintech platforms, assess investors’ backgrounds and ensure they are genuine and not involved in any sort of fraudulent transactions, including crimes like money laundering. Like KYC, KYI is part of a bigger Anti-Money Laundering (AML) compliance framework. Major regulatory bodies require financial institutions to perform due diligence. KYI is a key component of these measures, designed to prevent money laundering and terrorism financing in the investment sector, which is particularly vulnerable to fraud. Essentially, KYI confirms that investors have the necessary market expertise to help the business scale and ensure long-term success while ensuring that accepting the investment is within the company’s risk appetite and in line with all regulatory compliance requirements. --- ### Suspicious Transaction Report (STR) > Learn what a Suspicious Transaction Report (STR) is, how it differs from other documents, and what reporting requirements you should follow. - Published: 2025-01-10 - Modified: 2025-01-10 - URL: https://www.idenfy.com/glossary/suspicious-transaction-report-str/ A suspicious transaction report (STR) is a mandatory document that reporting industries, such as financial institutions, must file with the relevant financial intelligence unit (FIU) when they detect suspicious activity — potential cases of money laundering and other types of fraud. In other words, they must file STRs when a transaction is detected which can be connected to illegal activities. This term is also often used interchangeably with a suspicious activity report (SAR), depending on the jurisdiction. STRs serve as red flags, helping regulators and law enforcement take appropriate action. This is important, as unusual activity could indicate illegal actions threatening public safety or the overall transparency of the general financial system. So, using this reporting system helps alert authorities while providing valuable insights for identifying and preventing financial crime. --- ### Digital Operational Resilience Act (DORA) > See the latest details about the Digital Operational Resilience Act (DORA), and how it impacts EU's reporting entities' compliance tasks. - Published: 2025-01-08 - Modified: 2025-01-08 - URL: https://www.idenfy.com/glossary/digital-operational-resilience-act-dora/ The Digital Operational Resilience Act (DORA) is an EU regulation and a part of the European Commission's goal to make the financial system more transparent and secure. The DORA regulation sets clear rules for financial organizations to ensure their digital systems are reliable. It also works to provide unity in terms of security rules for various IT systems among the EU countries, helping to protect the entire market from tech-related issues, such as cyberattacks. DORA was published in 2022 and became official on 16 January 2023. The rules officially take effect on 17 January 2025. The regulation applies to financial organizations and their third-party tech service providers, including examples like investment firms or crypto-asset service providers (CASPs) and issuers of asset-referenced tokens (ARTs). --- ### Money Laundering Reporting Officer (MLRO) > Learn what kind of education and qualifications a Money Laundering Reporting Officer (MLRO) should have, what are their daily tasks, and more. - Published: 2025-01-08 - Modified: 2025-01-08 - URL: https://www.idenfy.com/glossary/money-laundering-reporting-officer-mlro/ A Money Laundering Reporting Officer (MLRO), also called a Nominated Officer, is a company’s go-to person regarding Anti-Money Laundering (AML) compliance, as their main responsibility is to ensure that the company remains in line with this regulatory framework. MLROs determine if suspicious activity reporting is required, ensuring that relevant authorities are informed of such activity. They have access to all individual and corporate client records in the company, which are required for AML processes like screening and ongoing monitoring, as well as keeping track of accurate client risk profiles. The term first originated in the UK under the Money Laundering Regulations 2007 legislation. Today, Money Laundering Reporting Officers are responsible for overseeing a company’s AML program. Since they work with sensitive data and carry many important responsibilities, MLROs must be properly vetted by a company’s senior management. They ensure that the MLRO fulfills its obligations and operates within the law. --- ### Financial Intelligence Unit (FIU) > See a detailed definition explaining what a Financial Intelligence Unit (FIU) is and see concrete examples of FIUs and their responsibilities. - Published: 2025-01-07 - Modified: 2025-01-07 - URL: https://www.idenfy.com/glossary/financial-intelligence-unit/ A financial intelligence unit (FIU) is a national or international governmental body that is responsible for collecting information regarding financial crime, such as money laundering or terrorism financing, and other suspicious activities that regulated entities, such as banks, are required to report. In general, FIUs are designed to receive, analyze and share information linked to financial crime. This concept has been popular since the early 90s in different countries that have their own FIUs. Financial intelligence units also help companies ensure compliance with anti-money laundering (AML) laws, provide training on new regulatory requirements, and update them on best practices or AML trends that are constantly evolving. An FIU is also responsible for handling Suspicious Activity Reports (SARs). Some FIUs can also verify that reporting companies comply with AML regulations or perform tasks like postponing transactions. --- ### Card-Not-Present (CNP) Fraud > Yes, card-not-present (CNP) fraud is a challenge due to high chargeback rates and hidden identities of criminals using this scheme. Read more. - Published: 2025-01-06 - Modified: 2025-01-06 - URL: https://www.idenfy.com/glossary/card-not-present-cnp-fraud/ Card-not-present (CNP) fraud, also referred to as remote purchase fraud, is a type of credit card fraud where a bad actor uses stolen credit card information or compromised card details to make purchases online (or, in a more traditional sense, over the phone or through the mail) without actually having the physical card with them. So, neither the card nor its owner is present when the criminal makes the transaction. For this reason, companies sometimes struggle to prevent such unauthorized charges. Criminals typically acquire credit card information using deceptive practices like phishing, account takeovers, or data breaches. In CNP transactions, the merchant is responsible for repaying the customer because they are responsible for verifying the customer’s identity and ensuring transactions are secured. Consequently, without proper Know Your Customer (KYC) verification measures, online businesses face increased fraud and chargeback risks, which result in financial losses. --- ### Biometric Authentication > Learn about biometric authentication, its key types, how it actually improves security, and why industries like crypto might want to use it. - Published: 2025-01-03 - Modified: 2025-01-03 - URL: https://www.idenfy.com/glossary/biometric-authentication/ Biometric authentication is a type of identity verification that’s based on analyzing unique physical traits, such as the user’s facial features, including other biometric data as an alternative (voice patterns, retina images, fingerprints, etc. ). It’s used to authenticate the user instead of asking them to enter a password and, for that reason, is considered to be a more secure way for access control in various use cases. For example, we use facial recognition to unlock smartphones. These unique biometric traits provide a secure method of authentication. --- ### Credit Card Fraud > Access FAQs people want to find out about credit card fraud, who is responsible for covering the costs, and how to avoid getting scammed. - Published: 2025-01-03 - Modified: 2025-01-03 - URL: https://www.idenfy.com/glossary/credit-card-fraud/ Credit card fraud is the use of a credit or debit card to make unauthorized purchases or withdraw money. It often involves stealing a victim’s existing account or using stolen personal information to open a new account under the stolen or fake identity. Simply put, bad actors use credit card fraud together with stolen account information as a way to open new accounts using personal data obtained from breaches. --- ### Subscription Fraud > Find out how bad actors and users who abuse free trials get tangled up in subscription fraud, leading to chargebacks and other issues. - Published: 2025-01-03 - Modified: 2025-01-03 - URL: https://www.idenfy.com/glossary/subscription-fraud/ Subscription fraud is a type of crime that involves exploiting the subscription model to gain unauthorized access to various services, such as a streaming platform, without the intention to pay. It consists of various deceptive practices and is often linked with other types of fraud, such as account takeover (ATO) fraud or synthetic identities created to create fraudulent subscriptions or to steal a worthy account with an already purchased subscription. Sometimes, such stolen accounts are then sold on the dark web or to third parties to harvest user data for further crimes. For businesses, this results in poor reputation, financial losses and lost customers, not to mention strained system resources and inability to scale and attract legitimate customers. --- ### Charity Fraud > Find out how criminals use charity fraud, if it's possible to detect it in real-time, and how often people actually succeed with it. - Published: 2025-01-02 - Modified: 2025-01-02 - URL: https://www.idenfy.com/glossary/charity-fraud/ Charity fraud is an illegal practice that involves deceiving people into donating to a fake charity or diverting funds from a legitimate charity into personal accounts. Some charity systems have poor auditing procedures and are more vulnerable to different risk factors, such as high cash flow. Businesses can also conduct this type of fraud and fabricate their needs to collect contributions. Working in high-risk regions with high money laundering rates can make it harder to detect charity fraud. Money laundering is also a huge risk for charities because criminals use them as channels due to their trusted reputation among the public. However, charities are subject to strict regulations, similar to how financial institutions need to comply with Anti-Money Laundering (AML) laws. This is especially important when operating in high-risk jurisdictions or sanctioned regions. --- ### Matched Betting > Review our explanation of matched betting, why it's considered to be a good investment, and why bookmakers don't want you to use this tactic. - Published: 2025-01-02 - Modified: 2025-01-02 - URL: https://www.idenfy.com/glossary/matched-betting/ Matched betting is a popular strategy in sports betting, which relies on free bets and sign-up bonuses. Rather than focusing on luck, a gamer places bets on all possible outcomes, ensuring a profit no matter the result. Simply put, this approach guarantees a win. Often, the person uses multiple bets and also exploits promotional bonuses offered by most betting companies. In terms of legal aspects, most betting platforms don’t want matched betting happening on their site, which makes it a “grey” area. So, even the more straightforward forms of matched betting violate the rules laid out by betting operators and go against the Terms and Conditions. For example, betting platforms don’t allow the repeated claim of sign-up bonuses or the creation of multiple accounts. --- ### Embezzlement > Learn all about embezzlement - one of the most serious forms of financial fraud through reading multiple answers to common questions. - Published: 2024-12-30 - Modified: 2024-12-30 - URL: https://www.idenfy.com/glossary/embezzlement/ Embezzlement is a serious form of financial fraud based on trust and access. Unlike traditional, well-known theft, which involves taking somebody’s property or assets, embezzlement occurs when someone trusted with the assets, property, or other possessions steals them for personal gain. Embezzlement often happens in a professional environment, such as in businesses, non-profit or non-government organizations (NGOs). The assets could vary from money and intellectual property to sensitive information or data, so, for example, if a company gives you their laptop for you to work with and you decide to steal it - it is embezzlement. The embezzlement is complicated - individuals often falsify documents or manipulate digital records, like altering computer system entries to hide unauthorized transactions or creating fake accounts to make transactions, making it harder to detect illegal activity. --- ### Corporate Transparency Act (CTA) > Access the key FAQs regarding the Corporate Transparency Act (CTA) and Beneficial Ownership Information (BOI) reporting requirements for various entities. - Published: 2024-12-19 - Modified: 2024-12-19 - URL: https://www.idenfy.com/glossary/corporate-transparency-act/ The Corporate Transparency Act (CTA) is a US regulation enacted as part of the Anti-Money Laundering Act of 2020 that requires reporting companies to file Beneficial Ownership Information (BOI) reports with the Financial Crimes Enforcement Network (FinCEN), a division of the Treasury Department. The Act aims to help detect and prevent illicit activities like money laundering through shell companies and tax evasion by collecting information about beneficial ownership and corporate structures of specific entities operating within the US market. CTA took effect on January 1, 2024. Before the CTA, financial institutions had to collect beneficial ownership details under customer due diligence (CDD) rules. Currently, CTA requires corporations, limited liability companies (LLCs), and similar entities to report their beneficial ownership, with strict penalties for failing to report or improperly sharing the data. --- ### Secretary of State (SOS) > Access the most popular FAQs regarding the Secretary of State (SOS), how to file, what information or documents are needed in diferrent states, and more. - Published: 2024-12-17 - Modified: 2024-12-17 - URL: https://www.idenfy.com/glossary/secretary-of-state-sos/ The Secretary of State (SOS) is a government agency that is an official body responsible for operating in 47 of the 50 US states. In some states, the local Secretary of State’s office is called the Department of State. The SOS department manages the state’s business entities, including corporations, professional corporations, LLCs, and others. The Secretary of State’s office also oversees business registrations within its jurisdiction, which is essential for legally operating in a state. So, when a US-based company operates in a certain state, it is required to register with the Secretary of State. This includes filing information and registering documents with the Secretary of State filing. Their responsibilities also include maintaining an online database, which can be accessed for information like registered agent details and other documents, such as Articles of Incorporation. --- ### Articles of Incorporation > Find out who needs to file Articles of Incorporation, why it's important for different types of entities, and what data is required to get approved. - Published: 2024-12-12 - Modified: 2024-12-12 - URL: https://www.idenfy.com/glossary/articles-of-incorporation/ Articles of Incorporation (AOI) are formal documents that need to be filed with a government agency to form a corporation. The data that needs to be submitted includes details like the entity’s name, address, and the agent for service of the process. This filing is required for a corporation to operate legally, among other important factors, such as trading in stocks or raising capital. Articles of Incorporation also protect the owners from personal liability in corporate litigation and provide tax benefits. Filing Articles of Incorporation is vital for an entity to become public record once filed with the state. This component serves as a corporate formation matter, and the data becomes available for other companies to access and find out more about the corporation. This is beneficial for potential investors and business partners, including during Know Your Business (KYB) verification checks. However, while the state ensures transparency, Articles of Incorporation can be altered, so the originally filed version is not final. --- ### Certificate of Good Standing > Learn which types of businesses can get a certificate of good standing, why it's important to all companies working in the US, and how to stay compliant. - Published: 2024-12-12 - Modified: 2024-12-12 - URL: https://www.idenfy.com/glossary/certificate-of-good-standing/ A certificate of good standing is a legal document designed to confirm that a company is operating legally in a certain state in the USA. By obtaining it, companies confirm that they are registered legally and are authorized to do business. Often, this document is issued by the state’s business filing agency only if the business meets all compliance and financial requirements, such as staying ahead on taxes, registration fees, and other filings. However, a certificate of good standing is not a license. That means, technically, it is not required to operate a business legally in its registered state. However, most companies will still need it in specific situations, such as obtaining insurance, setting up the business in different states, or bidding for government contracts. --- ### Aiding and Betting > Learn which crimes are often linked to aiding and betting, what it means in the context of gaming and AML compliance, and why you should care about it. - Published: 2024-12-06 - Modified: 2024-12-06 - URL: https://www.idenfy.com/glossary/aiding-and-betting/ Aiding and betting is the practice of encouraging or helping to conduct a crime. It’s a commonly used term when talking about anti-money laundering (AML) compliance. It means that anyone who assists or, in any type of way, helps facilitate money laundering is also a criminal. For example, this was mentioned in the 6th Anti-Money Laundering Directive (AML), and "aiding and betting” was included as an official criminal offense that also holds “enablers” legally liable for money laundering. --- ### Customer Due Diligence (CDD) > Learn about customer due diligence (CDD), its role in KYC/AML compliance, and why it's important to manage risks and maintain accurate risk profiles. - Published: 2024-12-06 - Modified: 2024-12-06 - URL: https://www.idenfy.com/glossary/customer-due-diligence-cdd/ Customer Due Diligence (CDD) is a package of measures designed to verify customer identities and assess their risk profiles throughout the business relationship. Such background checks help ensure that you’re not getting involved with an illegal entity. At a minimum, CDD involves verifying the client’s personal information and screening them against different databases, such as sanctions lists. Banks and other regulated businesses are obligated to implement CDD processes to comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements. CDD is also a vital part of a company’s risk management process, helping identify the level of due diligence required and using a risk-based approach to address different customer risk levels. Low-risk customers undergo simplified or standard due diligence, while high-risk clients are required to go through enhanced due diligence (EDD) checks. --- ### AML Geographic Risk > Access the key FAQs regarding a company's risk assessment and find out why the AML geographic risk plays a big part in it. - Published: 2024-12-05 - Modified: 2024-12-05 - URL: https://www.idenfy.com/glossary/aml-geographic-risk/ AML geographic risk is an element in the company’s overall risk assessment process, which is part of the Anti-Money Laundering compliance framework. Regulated entities, such as banks and other financial institutions, need to verify their customers and assess different risk factors linked to their profiles, including geographic risk. This helps do a background check on the services they offer and the types of clients they serve to understand how bad actors might exploit the company to facilitate money laundering or terrorist financing. In particular, AML geographic risk helps assess the customer's general money laundering risk. This is important because companies need to understand AML risks and evaluate their internal policies and controls as a way to reduce the chances of potential risks. For this reason, anti-money laundering compliance requires firms to implement a risk-based approach (RBA). In this sense, customers and transactions involving counterparties outside a customer's country of residence often are known to present a higher risk of fraud. --- ### Crypto-Asset Service Provider (CASP) > Learn how the MiCA regulation impacted every Crypto-Asset Service Provider (CASP), and learn its key requirements in the digital asset sector. - Published: 2024-12-02 - Modified: 2025-01-08 - URL: https://www.idenfy.com/glossary/crypto-asset-service-provider-casp/ A crypto-asset service provider (CASP) is a business that offers crypto wallets, crypto exchange services, and similar crypto-asset services professionally under the EU’s MiCA regulation. This term is part of a consistent approach to unifying compliance linked to digital assets. For example, a CASP can be a platform that facilitates trade executions and provides real-time data streams, enabling banks, brokers, and fintech companies to integrate crypto-trading services for their clients. The Markets in Crypto Assets, or the MiCA regulation, is a regulatory compliance framework that sets rules for various digital platforms that handle cryptocurrency assets (such as crypto exchanges or wallet providers). MiCA defines CASP compliance, and it now applies to crypto-assets that are not covered by existing financial services laws. It offers a unified approach and a single licensing framework for all crypto asset service providers and issuers. --- ### Smurfing > Learn how smurfing in money laundering and iGaming differs, and why criminal gangs use this technique to successfully avoid getting caught. - Published: 2024-12-02 - Modified: 2024-12-02 - URL: https://www.idenfy.com/glossary/smurfing/ Smurfing is a money laundering technique of breaking large sums of money into smaller transactions as a way to avoid detection by keeping all transfers below the reporting Anti-Money Laundering (AML) threshold. By spreading illicit funds across multiple accounts, criminals minimize the risk of triggering red flags. For example, banks in the US are required to report cash transactions over $10,000 and file a suspicious activity report (SAR). Smurfs use small transactions repeatedly and spread them through multiple accounts to stay below regulatory reporting limits. The term “smurfing” has its roots in the drug traffickers’ slang. Apparently, criminals often purchased small quantities of various substances or ingredients they needed to combine and produce the end product. Today, regulatory laws like the USA Patriot Act strengthened anti-money laundering efforts by requiring reports for deposits, withdrawals, or currency exchanges over the reporting threshold. --- ### Know Your Employee (KYE) > Stolen details, forged documents or attempts to hide a criminal record are all legitimate reasons why companies verify new hires via Know Your Employee. - Published: 2024-12-02 - Modified: 2024-12-02 - URL: https://www.idenfy.com/glossary/know-your-employee/ Know Your Employee (KYE) is a verification process used by companies to identify their potential hires before accepting them into the workplace. It works as a security measure and a background check, consisting of different processes, such as hiring, onboarding, and maintaining ongoing employment measures to ensure that you have an accurate employee profile. KYE can be used both for current and potential hires as a way to ensure that the people are who they say they are. For example, they provide legitimate identity documents and don’t have a history of criminal activity, especially in high-risk sectors like banking or fintech. This way, through the Know Your Employee process, companies can check if the applicant is suitable for the role. It’s also a regulatory requirement in the financial industry and other related sectors. --- ### Multi-Factor Authentication > Find out all about MFA, or Multi-Factor Authentication, a popular security measure and access control among remote businesses and online platforms. - Published: 2024-11-26 - Modified: 2024-11-26 - URL: https://www.idenfy.com/glossary/multi-factor-authentication/ Multi-factor authentication (MFA) is a verification measure that is designed to provide a user with access while ensuring security. Different from a standard password, MFA uses at least two types of credentials, such as a password and a security token or biometrics. For this reason, the end-user needs to provide additional information, for example, answer a question, type in a code that was sent to their smartphone, or complete a selfie check. The main goal of multi-factor authentication is to protect the user’s account even if the password is compromised. --- ### Promotion Abuse - Published: 2024-11-25 - Modified: 2024-11-25 - URL: https://www.idenfy.com/glossary/promotion-abuse/ Promotion abuse, or promo abuse, is a type of fraud where a user exploits a platform’s (often in iGaming and e-commerce) new-user benefits and offers, such as sign-up bonuses, vouchers, or referral bonuses. Users want to engage in such schemes in order to get bigger discounts. This isn’t a good practice because, for online platforms, not following the rules can result in financial losses and additional fraud cases, such as multi-accounting. Promotion abuse happens when a user (sometimes a skilled fraudster or even a group of criminals) creates duplicate accounts using their family member’s identity data or stolen personal information to impersonate different people. In practice, this means that a single person has different accounts that they use to take advantage of a promotion more than once. For this reason, industries that are more prone to this sort of abuse often implement the Know Your Customer (KYC) verification process. --- ### Device Fingerprinting > Learn what device fingerprinting is and how it can be used to detect fraud, unusual patterns, including bad actors conducting ATO attacks. - Published: 2024-11-25 - Modified: 2024-11-25 - URL: https://www.idenfy.com/glossary/device-fingerprinting/ Device fingerprinting is a method that tracks unique identifiers for devices by inspecting different combinations of attributes, such as browser settings, software configurations, or hardware specifications, with the goal of distinguishing one device from another within a network or system. As a result, instead of relying on IP addresses or cookies (traditional identifiers), device fingerprinting can generate a “fingerprint” or unique track record for each device. This method can improve security, prevent fraud, improve accuracy on certain processes, such as identity verification, and personalize the user experience while detecting potential threats. In simple words, device fingerprinting works like a passport because it can be used to identify another person by assessing different data points linked to how that individual sets their device. --- ### Personally Identifiable Information (PII) > Find out what sort of data is considered Personally Identifiable Information (PII) and why you might be asked to provide sensitive data online. - Published: 2024-11-22 - Modified: 2024-11-22 - URL: https://www.idenfy.com/glossary/personally-identifiable-information/ Personally Identifiable Information (PII) is any data that can be linked to a person as a way to identify them uniquely. PII can be used on its own or as a tool to combine other related information. In general, there are two types of PII data: direct identifiers (passport information, contact information, or Social Security number) and quasi-identifiers (race, gender, or date of birth). Personally Identifiable Information often consists of data that the user shares online. It can be traced back to that person as a way to identify, contact, or lactate them. PII can consist of information that you share online, for example, when creating a new account on a platform or completing a survey for a government agency, as well as when making a purchase on an e-commerce site. --- ### Gnoming in Betting > Learn how players abuse betting and iGaming sites to their advantage when claiming welcome bonuses and using gnoming, matched betting & more. - Published: 2024-11-22 - Modified: 2024-11-22 - URL: https://www.idenfy.com/glossary/gnoming-in-betting/ Gnoming in betting, also sometimes referred to as multi-accounting, is a popular practice in iGaming and occurs when players create new betting accounts using another person’s name (often fake or stolen) as a way to continue placing bets and abuse the rules or take advantage of the platform’s bonus system (intended for new accounts). Gnoming often happens when the user gets banned, or their account is restricted. Players that use gnoming in betting often say that the other accounts aren’t them and that they’re family and friends. That’s because the accounts can share the IP address, can come from the same household, and have similar names or residential addresses. For this reason, iGaming and betting platforms often have internal Trust and Safety teams that are responsible for detecting such anomalies and abusive player behavior. --- ### Online Gambling Fraud > Look through the most popular tactics in online gambling fraud, getting into the depths of how scammers actually score their winnings in iGaming. - Published: 2024-11-14 - Modified: 2024-11-14 - URL: https://www.idenfy.com/glossary/online-gambling-fraud/ Online gambling fraud is any illegal activity that is conducted to deceive gambling establishments and various iGaming platforms (such as sports betting and online casinos) with the intent to cheat and exploit loopholes in the system. This often involves defrauding players or exploiting bonus systems for financial gain. Fraudsters also use schemes like rigged games to increase winnings or fake phishing sites to carry out account takeovers. Since gambling is a cash-intensive industry, it’s especially prone to fraud and money laundering. As a result, over the years, regulators around the world have imposed stricter Know Your Customer (KYC), age verification, and Anti-Money Laundering (AML) regulations. That’s why players who use online gambling platforms need to be aware of the key signs of fraud, while operators need to maintain proper risk management strategies, minimizing the chances of fraudulent activities. --- ### Third-Party Fraud > Look through some common third-party fraud types and learn how criminals succeed with these types of scams online, focusing on how to protect your identity. - Published: 2024-11-13 - Modified: 2024-11-13 - URL: https://www.idenfy.com/glossary/third-party-fraud/ Third-party fraud is also simply known as identity theft. It’s the process of a criminal using another person’s personal data to commit the crime. Third-party fraud means that the bad actor uses a completely different identity (as opposed to first-party fraud) to unlawfully access financial resources, such as credit, loans, and other benefits, including products and services. Criminals often buy credentials off the dark web or use stolen information from phishing attacks to commit third-party fraud. Other times, they create synthetic identities (combinations of real and fake personal information) to open accounts on fintech platforms or take out loans in another person’s name. There are larger criminal organizations that execute this type of fraud on a larger scale. --- ### Bulk Cash Smuggling > Find out all about bulk cash smuggling, how it works, why criminal networks still use this method for money laundering, and more - all in the form of FAQs. - Published: 2024-11-12 - Modified: 2024-11-12 - URL: https://www.idenfy.com/glossary/bulk-cash-smuggling/ Bulk cash smuggling is the practice of collecting large amounts of money through different illegal activities, often smuggling the money and transporting the cash across borders to remain undetected. This is possible because criminals don’t declare the cash transportation, often not filing the right paperwork to avoid financial regulations. Both individuals and criminal organizations can be involved in this illegal process. --- ### Trade-Based Money Laundering > Learn what trade-based money laundering is, and what schemes criminals use to hide their dirty cash without getting caught. - Published: 2024-11-11 - Modified: 2024-11-11 - URL: https://www.idenfy.com/glossary/trade-based-money-laundering/ Trade-based money laundering (TBML) is an illicit method and a manipulation tactic used to hide laundered funds through international trade transactions, making them appear legitimate. This can be achieved through numerous complex ways, such as manipulating imports, exports, or the prices of trade transactions. Criminals often combine other money laundering techniques with trade-based money laundering to hide from government agencies. This way, using international trade, they can cover their tracks. The rise of global trade has made trade-based money laundering a standard criminal method. For example, fraudsters use the delay between shipping the items and receiving payment to forge documents and transfer funds more seamlessly so that their illicit activities would be harder to track. Criminal organizations also use TBML on a larger scale. --- ### Digital Identity > Find out how your digital identity is used online, and why many businesses ask their customers to complete various identity verification procedures. - Published: 2024-11-01 - Modified: 2024-11-01 - URL: https://www.idenfy.com/glossary/digital-identity/ Digital identity is a collection of information linked to a person and their online persona, showing that they exist on the internet. The details that can be found online, such as search history, banking info, or social media pictures, are all part of a person’s digital identity. This set of information can also be used to verify a person’s identity and grant them access to online services through the Know Your Customer (KYC) verification process. Many financial institutions and other online platforms use a person's details to onboard them remotely (verify their personal data online) instead of asking them to fill out paper-based documents or visit a physical banking branch. Consequently, the concept of digital identity has become mainstream, showing the impact of technology on daily operations, such as accessing loans remotely, using open banking, investing in crypto, purchasing items on e-commerce platforms, connecting on social media, etc. --- ### Ongoing Due Diligence (ODD) > Learn what ongoing due diligence (ODD) is, and how it is related to continuous monitoring and other due diligence measures required for KYC/AML compliance. - Published: 2024-10-31 - Modified: 2024-10-31 - URL: https://www.idenfy.com/glossary/ongoing-due-diligence/ Ongoing due diligence (ODD) is a set of compliance measures that companies apply when continuously assessing customers and business activities to identify and mitigate risks, such as money laundering and terrorism financing. It’s a more in-depth approach to Know Your Customer (KYC) because it focuses on reviewing and monitoring accounts for new risks after the onboarding stage and in real-time, whereas KYC checks happen at the start of the business relationship with the client. Ongoing due diligence helps compliance teams spot Anti-Money Laundering (AML) red flags and keep up with up-to-date, accurate customer risk profiles, which help financial institutions follow the risk-based approach (RBA). So, ODD helps ensure that the client’s risk profile, source of funds, and overall activities match the company’s internal risk levels. Ongoing due diligence also helps spot inconsistencies in user behavior, immediately helping prevent larger issues from happening. --- ### Proof of Funds > Learn what type of documents can be accepted of proof of funds (POF), and when companies are required to follow this verification process. - Published: 2024-10-25 - Modified: 2024-10-25 - URL: https://www.idenfy.com/glossary/proof-of-funds/ Proof of funds (POF) is a document proving that the customer (an individual or a company) has the necessary funds to complete a transaction. By verifying proof of funds, financial institutions and other businesses that handle large transactions, such as real estate or investment firms, can verify that the financial background of all involved parties is legitimate and stable. In short, POF confirms that the funds are accessible and legitimate for completing a transaction or customer onboarding. Typically, proof of funds verification includes elements like checking a bank statement because it shows the account holder’s balance and the transaction history. There are certain criteria that the document should meet. For example, a POF document should be from the last 30 to 90 days to ensure the information is up-to-date and accurate. --- ### Australia’s Social Media Ban > Learn about the latest restrictions for social media users who are underage, and how this social media ban would look i practice according to Australia. - Published: 2024-10-21 - Modified: 2024-10-21 - URL: https://www.idenfy.com/glossary/australias-social-media-ban/ Australia’s social media ban is a planned minimum age requirement (set between 14 and 16 years old) restricting children from using social media platforms. The country’s government argues that this change will help minimize social media’s negative impacts on the physical and mental health of a sensitive age group — young social media users. This ban isn’t valid yet, as Australia’s government announced that its government would first conduct an age verification trial before officially introducing the age limit law. This isn’t a new concept, as countries like the US or the UK have also explored similar initiatives to control how children engage with online content. --- ### Proof of Income > Explore the key documents that are considered to be proof of income and learn why companies might ask you to complete this verification process. - Published: 2024-10-18 - Modified: 2024-10-24 - URL: https://www.idenfy.com/glossary/proof-of-income/ Proof of income, also sometimes referred to as the source of wealth, is the process of requesting a customer a document that shows how they earn their money, ensuring that the transactions are authorized and fair, not linked to any fraudulent activity. Employees, as well as business owners or self-employed individuals, need to prove their earnings this way. For example, businesses would be asked to provide cash flow statements, tax returns, and other official documents as proof of income. This process aims to verify the client’s financial stability, verifying if they meet their obligations, such as the ability to get a loan, access a credit card, or rent a new apartment in order to ensure that they have proper income to cover the upcoming payments. So, in general, proof of income is essential for many financial transactions, and requirements vary by country and currency. --- ### MiCA Regulation > Access the latest news regarding the Markets in Crypto Assets, or the MiCA regulation in one place and learn how to comply with this framework in the EU. - Published: 2024-10-16 - Modified: 2024-10-16 - URL: https://www.idenfy.com/glossary/mica-regulation/ The Markets in Crypto Assets, or the MiCA regulation, is a regulatory compliance framework that sets rules for various digital platforms that handle cryptocurrency assets (such as crypto exchanges or wallet providers). It’s one of the main digital asset licensing regimes in the EU, establishing a unified classification for cryptocurrencies. MiCA was approved by a majority of votes in the European Parliament in April 2023 and is expected to attract more crypto operators and users to the market. --- ### NFC Verification > Learn what NFC technology is, and how it can be used in NFC verification, similarly to Apple Pay and other applications that are powered by it. - Published: 2024-10-14 - Modified: 2024-10-14 - URL: https://www.idenfy.com/glossary/nfc-verification/ NFC verification is a wireless process designed to authenticate a person using Near-Field Communication technology or short-range communication between the device and an electronic (NFC-enabled) ID document through the use of magnetic field interactions when they are brought close together. Documents that have an NFC chip hold isometric data, including a high-resolution photo, enabling ID verification checks by comparing this data with a person's selfie, enhancing protection against fraud. Electronic identity documents encrypt and store this biographic and biometric data securely and digitally signed using a certificate from the issuing country. Additionally, NFC-enabled biometric IDs, passports, and residence permits allow secure data extraction and cryptographic verification by tapping them against NFC devices or eGates. For this reason, Know Your Customer (KYC) specialists say that NFC-enabled IDs are harder to forge. --- ### Forex (FX) Trading > Learn what forex trading, or FX trading is by debunking common misconceptions and risks through simple and concise FAQs in our glossary. - Published: 2024-10-08 - Modified: 2024-10-08 - URL: https://www.idenfy.com/glossary/forex-trading/ Forex trading, foreign exchange trading, or FX trading is the process of exchanging or buying and selling different currencies in a global market. It’s one of the most active financial markets in the world, and it handles trillions of dollars in transactions every day despite not having a centralized physical location. Businesses, banks, and individuals all operate in the FX trading market and aim to profit from the price difference. In the forex, traders deal with currencies, cryptocurrencies, indexes, commodities, contracts for difference (CFDs), and spreads. Currencies can be traded in pairs based on their exchange rates. Traders focus on these exchange rates because they determine the value of one currency relative to another, investing in currencies they believe will rise in value. --- ### Database Verification > Find all the latest FAQs regarding the database verification process in one place and learn why this KYC method is more considered to be more secure. - Published: 2024-10-07 - Modified: 2024-10-07 - URL: https://www.idenfy.com/glossary/database-verification/ Database verification is a Know Your Customer (KYC) measure that is designed to onboard a user by cross-checking their personal details against local and global databases that consist of reputable, trusted information. This process differs depending on the company’s specific use case, operating industry, and compliance requirements. However, it often involves verifying a user's identity by comparing their data against multiple databases to find a match with a source from the database in a certain country, for example, in the US. --- ### Responsible Gaming > Find out what measures iGaming, gambling, casino and other gaming establishments implement to secure their players and ensure responsible gaming. - Published: 2024-10-03 - Modified: 2024-10-03 - URL: https://www.idenfy.com/glossary/responsible-gaming/ Responsible gaming is a set of practices designed to raise awareness and responsibility regarding safer gaming or gambling practices in casinos, betting, iGaming, and similar industry establishments. These measures aim to protect both operators and their players worldwide, creating a valid, transparent, and fair gaming environment that focuses on solving problem gambling. This is both an ethical response and a vital security measure for gaming platforms that are considered to be high-risk due to opening doors for individuals who are more prone to addiction. So, that’s why responsible gaming initiatives aim to accelerate controlled, fun, and fair gaming practices while protecting vulnerable players from harm. --- ### Identity Verification > Access the key FAQs that both businesses and users have towards the identity verification process and its different forms that can still cause confusion. - Published: 2024-10-03 - Modified: 2024-10-03 - URL: https://www.idenfy.com/glossary/identity-verification/ Identity verification is the process of confirming a person’s identity, typically through digital means, like a combination of document verification (where the user is asked to upload an ID document) and selfie verification (where software scans a person’s face or biometric data). The main goal of this process is to prove that the person completing an ID check is legitimate and that a real human behind the screen is actually doing the work, as opposed to a fraudster using a deepfake or other schemes that are now widely used to bypass the verification. Identity verification is sometimes referred to as a Know Your Customer (KYC) check, especially in high-risk, regulated industries like crypto or banking, due to this process being a mandatory requirement. It helps online platforms to actually “know” their customers before granting them access to financial services. This is important in a broader context because criminals aim to access platforms and often conduct fraudulent transactions, takeover accounts, launder funds, etc. , so ID verification helps prevent illicit activity during the onboarding stage. --- ### Virtual Asset > Learn about the key qualifications that a virtual asset (VA) should have, FATF's standpoint, the regulations that VASPs face, and more FAQs in one place. - Published: 2024-10-01 - Modified: 2024-10-01 - URL: https://www.idenfy.com/glossary/virtual-asset/ A virtual asset (VA), also referred to as a crypto asset, is a digital representation of value. In general, it refers to various digital forms or values that exist online or in virtual format and can represent ownership or rights. Virtual assets can be used as payments (excluding digital forms of fiat currencies). They can also be transferred or traded. In the context of cryptocurrency specifically, VAs are blockchain-based assets that are also used as an investment, for transactions, or as a way to trade. According to the major regulatory watchdog, the Financial Action Task Force (FATF), a virtual asset is "any digital representation of value that can be digitally traded, transferred, or used for payment. ” --- ### Integration in Money Laundering > Learn about the third stage of money laundering - integration - and found out the main tactics criminals use to clean dirty cash without getting caught. - Published: 2024-10-01 - Modified: 2024-10-01 - URL: https://www.idenfy.com/glossary/integration-in-money-laundering/ Integration in money laundering is the third and last stage of the money laundering process, where criminals clean the dirty money by depositing it back into their accounts. Since the illicit funds are mixed with legitimate transactions or assets in the financial system, the money is “integrated,” enabling criminals to spend it freely. The goal behind this process is to make the money appear as lawful wealth when, in reality, it is dirty cash. By the stage of integration, law authorities have fewer chances of detecting such illegal activity. --- ### Neobank > Do you know the definition of a neobank? Or what's the difference between neobanks and online banking service providers? We provide the key insights. - Published: 2024-10-01 - Modified: 2024-10-01 - URL: https://www.idenfy.com/glossary/neobank/ A neobank is a fintech company, also sometimes called a challenger bank, that provides digital banking services using partnerships with traditional banks. It’s a digital-first business, often a startup, that isn’t a bank itself but operates similarly to a physical banking branch, just online. Neobanks offer services like checking and savings accounts, as well as other budgeting tools that are easily accessible using applications and websites. Neobanks are popular because they are known for low fees and good user experience — both vital factors in today’s financial market. --- ### Multi-Accounting > Learn why many are tempted to get involved in multi-accounting, and how it has became a common practice for promo abuse in industries like iGaming. - Published: 2024-09-27 - Modified: 2024-09-27 - URL: https://www.idenfy.com/glossary/multi-accounting/ Multi-accounting is the process of exploiting a platform for personal bonuses online, typically in order for the user to access discounts, free trials, or coupons. It’s a common practice to create multiple accounts in different industries, such as e-commerce marketplaces or iGaming platforms. At first glance, multi-accounting is harmless, but it actually is often linked to fraud and should be treated as a signal of suspicious behavior. For this reason, most companies don’t allow multiple accounts, and this is noted in their Terms and Conditions. Some fraudsters create multiple user profiles to sell fake goods, phish for personal information, conduct account takeover (ATO) attacks, and so on. They can achieve this by using bots or proxy services to bypass bans and account limits. Companies employ fraud prevention tools and often have Trust and Safety teams who deal with this issue and try to prevent negative consequences and financial losses. --- ### Know Your Business (KYB) > Learn the latest news about Know Your Business (KYB) and access FAQs on how to onboard other companies and comply with ever-evolving regulations. - Published: 2024-09-25 - Modified: 2024-09-25 - URL: https://www.idenfy.com/glossary/know-your-business-kyb/ Know Your Business (KYB) is a process designed to verify another company’s (corporate client) identity, similar to how Know Your Customer (KYC) works for verifying user (individual client) identity. KYB is also part of the mandatory Anti-Money Laundering (AML) framework, which requires financial institutions to check their business partners, third parties, and any potential companies that they consider working with and starting a business relationship with. The KYB process’ importance goes beyond compliance regulations. It helps assess whether the company is legitimate and isn’t involved in any sort of criminal activity. In this sense, KYB helps break down the true ownership structure, identifying and verifying key company data (like address and registration number) and its shareholders, directors, and other stakeholders that potentially could be involved in corruption, sanctions evasion, or other crimes. --- ### eIDV > Find out about eIDV, or Electronic Identity Verification, and access the key FAQs that you should know for both an effective and compliant KYC flow. - Published: 2024-09-25 - Modified: 2024-09-25 - URL: https://www.idenfy.com/glossary/eidv/ eIDV, or Electronic Identity Verification, is an online process designed to confirm a customer’s identity by using various methods, such as biometric verification and database verification. Often, companies use personal detail records and verify the user by comparing their information with official government databases. In general, eIDV uses personal data, including the name, date of birth, address and other information, showing a match, no match, or partial match to the user’s identity. The eIDV process is one of the key elements in Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance, which is required for regulated entities based on the three main components: Customer Identification Program (CIP), Customer Due Diligence (CDD), and ongoing monitoring. eIDV, or identity verification, is part of the CIP process, which aims to confirm the identity of a client before starting a business relationship with them to ensure that they don’t pose any risks to your organization. --- ### Phone Verification > Access all the FAQs regarding Phone Verification in once place, focusing on simple explanations regarding the process, and why it's important. - Published: 2024-09-23 - Modified: 2024-09-23 - URL: https://www.idenfy.com/glossary/phone-verification/ Phone verification is the process of verifying a user’s phone number for security reasons, mainly to prevent fraud, such as accepting bad actors to an online platform who later can pose risks to the business. This measure can be used as an extra layer of security next to the standard Know Your Customer (KYC) verification process. Its main goal is to check that the phone number actually belongs to the account holder. --- ### Bank Verification > Learn all about the Bank Verification process, its key components, and what kind of institutions conduct this extra verification step on their users. - Published: 2024-09-23 - Modified: 2024-09-23 - URL: https://www.idenfy.com/glossary/bank-verification/ Bank verification is the process of checking if a bank account is legitimate and active. It verifies whether the account belongs to the person claiming it, and not a fraudster or an impostor. Bank verification typically requires customers to provide ownership proof, such as a bank statement or verify identity using credit bureau data. Sometimes, this process also verifies if the account has sufficient funds and looks through transactions, such as payments or deposits. --- ### Adverse Media > Access a brief explanation of what adverse media is, and why companies sometimes need to screen such negative news to find out links to crime. - Published: 2024-09-09 - Modified: 2024-09-09 - URL: https://www.idenfy.com/glossary/adverse-media/ Adverse media, also known as negative news, is opposing information found in various news sources, typically online outlets, which include information about criminal activity, allegations and other activities like ties with gangs, corruption, money laundering, sanctions evasion, etc. Many financial institutions and other regulated entities screen adverse media to identify potential risks associated with a customer before accepting their account. However, this process serves as a precautionary security measure and ensures compliance with anti-money laundering (AML) laws and regulations during both onboarding and ongoing monitoring. --- ### Non-Doc Verification > Learn what non-doc verification is and how it can be used as a more streamlined approach to both identity verification and address verfication. - Published: 2024-09-09 - Modified: 2024-09-09 - URL: https://www.idenfy.com/glossary/non-doc-verification/ Non-doc verification, or non-document verification, is an identity verification process designed to provide users with a more streamlined Know Your Customer (KYC) verification experience because it doesn’t require uploading a photo of an ID document. This type of verification includes comparing the customer’s provided information with data from public databases, consumer reporting agencies, or other reputable sources. Non-doc verification automatically retrieves key details like name, date of birth, and address directly from these government databases. --- ### Know Your Customer (KYC) > Access the main definition of Know Your Customer, also known as KYC verification, and scroll through the main FAQs linked to this topic. - Published: 2024-09-03 - Modified: 2024-09-03 - URL: https://www.idenfy.com/glossary/know-your-customer/ Know Your Customer (KYC) is the process of verifying customer identities when they register for the first time on an online platform. This is especially important for banking apps, crypto platforms, and other industries where there’s a higher risk of identity theft, money laundering, and other financial crimes. The KYC process is a security measure and a mandatory requirement for regulated entities. If a customer going through the verification doesn’t meet the minimum standards, banks can refuse to open an account or may even end the business relationship. --- ### Sole Proprietorship > Learn what a sole proprietorship is, how taxes are calculated in this case, and how it differs from LLCs in terms of KYC/KYB compliance regulations. - Published: 2024-09-02 - Modified: 2024-09-02 - URL: https://www.idenfy.com/glossary/sole-proprietorship/ A sole proprietorship, also referred to as also known as a sole tradership,is an unincorporated business, which is owned and controlled by a single individual, a company, or a limited liability partnership. This type of business is relatively easy to set up, which is why it’s often chosen by small businesses, consultants, and individual contractors. Legally, a sole proprietorship is not a separate entity from its owner and has no partners. In other words, there is no legal distinction between the company and the owner, who owns all profits and, at the same time, is responsible for all debts and losses. For example, a freelance videographer is considered a sole proprietor and, depending on the industry, will need to receive various licenses and permits. --- ### Online Casino Verification > Learn why online casino verification is a mandatory KYC/AML requirement in many countries for a secure gaming environment and a fraud-free system. - Published: 2024-09-02 - Modified: 2024-09-02 - URL: https://www.idenfy.com/glossary/online-casino-verification/ Online casino verification is the process of confirming a customer’s identity before signing them up to play on an online casino platform. Since casinos and other gaming establishments are regulated businesses, they must comply with Know Your Customer (KYC) and anti-money laundering (AML) regulations, which mandate such verification measures. There is also a mandatory age verification check to confirm that the user is of age and can play games legally. The most common online casino verification methods include document verification and biometric checks. These methods require the customer to upload a government-issued ID photo and a selfie, which are then cross-checked against document bases to see if the person is legitimate, of age, and not using fraudulent methods like forged documents or deep fake technology to bypass the verification process. --- ### Transaction Monitoring > Find a concentrated guide on transaction monitoring by exploring the key FAQs linked to AML compliance requirements and FATF recommendations. - Published: 2024-08-29 - Modified: 2024-08-29 - URL: https://www.idenfy.com/glossary/transaction-monitoring/ Transaction monitoring is a common anti-money laundering (AML) compliance process that is designed to monitor customer transactions (transfers, withdrawals and deposits) to detect suspicious activity. It helps financial institutions and other companies that handle payments to assess customer data and build an overall picture of their behavioral activity. During monitoring, red flags can emerge, prompting further investigation to decide if the alert is a true or a false positive. A transaction monitoring system is often automated to achieve better results and is designed to spot money laundering and other financial crimes. Banks, fintech businesses, and other regulated industries are required to implement this process, as well as report suspicious activities that are detected during this process. --- ### Bank Account Verification > Learn why banks need to check ID documents, bank statements and other personal details when opening a bank account — all through simple FAQs. - Published: 2024-08-28 - Modified: 2024-08-28 - URL: https://www.idenfy.com/glossary/bank-account-verification/ Bank account verification is a security measure applied during the account verification process when the customer is asked to provide personal information to ensure that the financial institution deals with a genuine customer rather than a bad actor who provides forged documents or stolen data. In other words, this process ensures that the bank account is valid and that the institution isn’t dealing with a fraudulent account holder while complying with Know Your Customer (KYC) verification requirements. This process confirms that the account is active and belongs to the same person claiming its ownership. Financial institutions and payment service providers use bank account verification to reduce the chances of fraud. For this reason, when opening a new bank account, users are asked to complete an identity verification check (using ID documents and cross-checking the data with another database, such as a credit bureau) or provide proof of ownership (such as a bank account statement). --- ### AI Fraud > Find out what kind of scams and deceptive practices fall into the "AI fraud" category and explore the key tactics where AI can be used against people. - Published: 2024-08-27 - Modified: 2024-08-27 - URL: https://www.idenfy.com/glossary/ai-fraud/ AI fraud, or artificial intelligence fraud, is a deceptive practice that involves using AI for fraudulent activities. While AI as a technology has many benefits, criminals misuse it to exploit companies, steal personal information, and create deepfakes, which is a form of synthetic content that, when used fraudulently, can be a tool for misinformation, propaganda, or a way to bypass identity verification systems and conduct further financial crimes, like fraudulently apply for loans. --- ### Age Gating > Learn all about an age gate, find out if it's easily bypassed, why certain platforms have this function and other key FAQs linked to this topic. - Published: 2024-08-27 - Modified: 2024-08-27 - URL: https://www.idenfy.com/glossary/age-gating/ Age gating is a security measure designed to protect minors and restrict access to certain content and features online, typically linked to age-restricted industries, such as e-commerce sites selling alcohol or tobacco, or the media, where the user has to confirm they’re of legal age and can read the article. Age gating is called like that because it has an “age gate,” which helps businesses, particularly online platforms, ensure that children are not exposed to material that is inappropriate for their age. It can be a simple pop-up asking website visitors to confirm they are of legal age or a box where users are required to enter and confirm their birthdate as part of the age gating process. --- ### Know Your Merchant (KYM) > Learn about the key Know Your Merchant (KYM) measures and access FAQs linked to merchant onboarding and KYC/KYB/AML regulatory requirements. - Published: 2024-08-21 - Modified: 2024-08-21 - URL: https://www.idenfy.com/glossary/know-your-merchant-kym/ Know Your Merchant (KYM) is a due diligence measure for assessing risks linked with a new business relationship with a merchant. This includes verifying business information, including checking financial history or various documents, to confirm that the other business/partner is legitimate and not involved in any fraudulent activity. The KYM process aims to ensure a secure merchant onboarding process, which is vital for payment service providers (PSPs), such as credit card companies, to sign up new clients in a compliant way and evaluate potential merchants before allowing them to provide services on their network. Simply put, Know Your Merchant measures are necessary because financial services carry a higher risk of fraud. --- ### Vending Machine Age Verification > Learn how businesses found a new niche - vending machines - and find out the main age verification points that age-restricted sellers should know. - Published: 2024-08-13 - Modified: 2024-08-13 - URL: https://www.idenfy.com/glossary/vending-machine-age-verification/ Vending machine age verification is the process of verifying individuals who are buying items on vending machines, specifically in terms of their age. It’s designed to ensure that age-restricted products are sold to verified, genuine, and age-appropriate buyers. Common industry examples include tobacco, alcohol, vaping, and CBD products that are accessible through vending machines. Businesses are required by law to check customers’ ages before accepting their payments for such items. Vending machines equipped with age verification technology can swiftly and accurately confirm the buyer's age, ensuring a seamless transaction. This not only protects the business but also guarantees compliance with the regulations, providing a sense of reassurance to the business owners. --- ### Romance Scam > Remember the Tinder Swindler? Learn how a romance scam can actually be successful, and how both users and platforms can prevent such fraud. - Published: 2024-08-12 - Modified: 2024-08-12 - URL: https://www.idenfy.com/glossary/romance-scam/ A romance scam is a fraudulent scheme in which a person, using manipulative tactics, pretends to be romantically interested in the victim. This happens when the scammer creates a fake persona online, such as a dating app, and tricks their victim by pretending to have a romantic relationship with them. The fraudster then bombards them with affection to gain their trust, eventually asking the victim to wire money and “help” them financially. While this sort of scam may seem easy to spot and avoid financial losses, criminals who carry out romance scams are often highly skilled at their jobs. They seem genuine and want to establish a relationship quickly, sometimes reaching such heights as proposing marriage. Sometimes, scammers don’t meet their victims in person even though they arrange multiple meetings. However, they ask for money, pretending there’s an unexpected legal fee or a medical emergency. --- ### Synthetic Identity Fraud > Find out about synthetic identity fraud and discover how fraudsters create these false personas to max out credit cards, access loans and more. - Published: 2024-08-09 - Modified: 2024-08-09 - URL: https://www.idenfy.com/glossary/synthetic-identity-fraud/ Synthetic identity fraud is an illicit practice used by criminals, which happens when real and fake information is combined to create a new, fake, in this case, synthetic identity. Criminals use this process to fabricate information and open new bank accounts, make unauthorized purchases, defraud government agencies, apply for mortgages, and more. Synthetic identity fraud is one of the fastest-growing types of identity theft because mixing real and fake information is harder for financial institutions to detect. That’s because bad actors sometimes don’t use their created synthetic identities at first. Instead, they let them sit for a year or more before using them to commit fraud. In practice, a fraudster might add a synthetic identity to their existing credit card to build credit and make it appear more genuine. This strategy enables the criminal to carry out a larger-scale scheme later on. --- ### Payment Fraud > Explore the different types of payment fraud and learn the negative effects that can happen when fraudulent transactions slip under the radar. - Published: 2024-08-08 - Modified: 2024-08-08 - URL: https://www.idenfy.com/glossary/payment-fraud/ Payment fraud is a form of financial fraud that happens when another person uses false payment information to make a purchase. In other words, it refers to the process where a criminal conducts an illegal transaction. This can be done in various ways, such as falsely claiming refunds, using stolen payment information, creating fake checks, or making unauthorized fund transfers. With the rise of online payments, payment fraud has become a common deceptive tactic, especially in the e-commerce sector. Some criminals intentionally target online marketplaces and other shops that have either large transaction volumes or less stringent security measures. For this reason, all online platforms should integrate proper identity verification and ongoing monitoring measures. --- ### Face Authentication > Understand the main principles behind Face Authentication and access the key FAQs regarding this concept in identity verification. - Published: 2024-08-08 - Modified: 2024-08-08 - URL: https://www.idenfy.com/glossary/face-authentication/ Face authentication, also sometimes referred to as facial recognition, is a biometric technology that is designed to verify users, granting them access to various services. This includes both physical locations and online platforms, such as banks, fintechs, prop-tech platforms, and so on. Regulated industries use face authentication as an extra Know Your Customer (KYC) measure, often combined with document verification checks, or as a way to re-authenticate users before high-risk situations. The face authentication process compares the user’s facial biometric data with stored information, such as a previously provided ID document’s photo, and verifies their identity by denying or authorizing access to online services, items, or physical areas. The software uses biometric algorithms and liveness detection technology that prompts the user to follow instructions, such as nodding or moving their face in a certain direction, to see if they are actively present during the verification session. This prevents deepfakes and other fraudulent attempts to bypass the system. --- ### Mississippi Age Verification Law > Learn what is Mississippi Age Verification Law (SB 2346), and how it helps to protect children from pornographic media exposure. - Published: 2024-08-07 - Modified: 2024-08-07 - URL: https://www.idenfy.com/glossary/mississippi-age-verification-law/ Mississippi prioritized the online safety of children; this prompted an effort to protect minors from exposure to pornographic content online. Mississippi Governor Tate Reeves, on April 18, 2023, signed the senate bill (SB 2346), also known as “An Act to Regulate Pornographic Media Exposure to Children. ” This act mandates websites containing a substantial portion of pornographic content must implement reasonable verification methods to confirm the age of individuals attempting to access such material. Legislators with the Mississippi Library Association have revised this act to narrow the bill to the most harmful online content. --- ### Triangulation Fraud > Learn what is triangulation fraud, how it affects marketplaces, and what kind of red flags should users look out for when shopping online. - Published: 2024-07-31 - Modified: 2024-07-31 - URL: https://www.idenfy.com/glossary/triangulation-fraud/ Triangulation fraud is a common e-commerce scam and a form of card-not-present (CNP) fraud where a criminal uses an online store or marketplace to purchase an item using a stolen credit card and then arranges for a legitimate buyer to receive the item, and, this way, completes a triangular transaction. This is called triangulation fraud because the criminal acts as an intermediary between two other parties: the online store and the legitimate customer. However, triangulation fraud can involve up to four unsuspecting parties, which makes it more challenging for online retailers to detect this type of scheme. Often, the criminal obtains stolen credit card details off the dark web. --- ### Ultimate Beneficial Owner (UBO) > Learn the criteria, which makes a person an ultimate beneficial owner, or UBO, and access FAQs regarding to a company's ownership structure. - Published: 2024-07-29 - Modified: 2024-07-29 - URL: https://www.idenfy.com/glossary/ultimate-beneficial-owner/ An ultimate beneficial owner (UBO) is a person who has control over a company, institution, business, or legal entity, holding a percentage of ownership. It’s a natural person who ultimately benefits when the company initiates a transaction. UBOs are important in the context of anti-money laundering (AML) compliance because regulated businesses are required to verify and monitor beneficial owners. The particular definition of a UBO depends on the jurisdiction, but typically, an ultimate beneficial owner is considered an individual who holds 10-25% shares of the company or voting rights. --- ### Money Mule > Find a simple definition explaining what a money mule is, how a person can be recruited to become an accomplice to money laundering, and more. - Published: 2024-07-29 - Modified: 2024-07-29 - URL: https://www.idenfy.com/glossary/money-mule/ A money mule is a person who provides their personal information on purpose to receive fraudulent transfers. Often, money mules are aware that they’re engaging in criminal activity, but sometimes, they are unaware of the scale of the scheme and its consequences. Criminals can lure money mules into assisting them by promising quick cash. It can go either way, the criminal can use the money mule’s information to open a bank account in their name, or the money mule can open one themselves and later give full access to the fraudster. No matter the method, money mules are considered to be accomplices who assist money launderers in staying undetected while laundering money. --- ### The Kids' Online Safety Act (KOSA) > Learn about The Kids' Online Safety Act (KOSA) as a new U.S. regulation with concrete questions answered by iDenfy. - Published: 2024-07-25 - Modified: 2024-08-08 - URL: https://www.idenfy.com/glossary/the-kids-online-safety-act-kosa/ The Kids' Online Safety Act (KOSA) is a new U. S. regulation currently under debate. It aims to make social media platforms and the internet safer for children and young adults. The bill has provisions that focus on issues like cyberbullying, exposure to inappropriate content, and the addictive nature of certain features of these platforms. Notably, KOSA holds social media platforms responsible for the content they host and the algorithms they use to distribute it. The bill is currently up for debate on the US Senate floor and has bipartisan support. --- ### Louisiana Age Verification Law > Find out the latest updates and FAQs regarding Louisiana's Age Verification Law, Secure Online Child Interaction and Age Limitation Act. - Published: 2024-07-23 - Modified: 2024-07-23 - URL: https://www.idenfy.com/glossary/louisiana-age-verification-law/ The Louisiana Age Verification Law is a legal requirement for social media platforms and other websites that show adult-oriented content specifying the mandatory implementation of age verification systems for users. The law protects Louisiana users and account holders under 16 years old. This law became effective on the 1st of July, 2024. Parents and guardians of minors can take legal action against platforms that do not implement reasonable age verification measures. This has put Louisiana at the forefront of states taking proactive measures on child online safety and against the risk of unregulated online content distribution and accessing adult content like pornography, amongst others. --- ### Arkansas Social Media Safety Act > All frequently asked questions, concise definition and more context about the Arkansas Social Media Safety Act explained in one place. - Published: 2024-07-17 - Modified: 2024-07-17 - URL: https://www.idenfy.com/glossary/arkansas-social-media-safety-act/ The Arkansas Social Media Safety Act is a safety law directed at minors and protects them from harmful content online. Under the Act, social media companies must check how old their users are, meaning they need to implement age verification measures. The Social Media Safety Act also makes it illegal for minors to have their own accounts on social media unless their parent or legal guardian agrees. In April 2023, Arkansas Governor Sarah Huckabee Sanders signed the Act into law. Despite that, a federal judge stopped the Arkansas Social Media Safety Act temporarily later in September. Currently, the governor of Arkansas is encouraging lawmakers to resume working on it. --- ### Protection and Electronic Documents Act (PIPEDA) > Access the definition and the key insights on the Protection and Electronic Documents Act (PIPEDA) and related questions in one place. - Published: 2024-07-17 - Modified: 2024-07-17 - URL: https://www.idenfy.com/glossary/protection-and-electronic-documents-act/ The Personal Information Protection and Electronic Documents Act (PIPEDA) is a Canadian law that governs how data collected for commercial purposes is handled. The Act protects data and ensures privacy while upholding people's trust in organizations. PIPEDA sets out different requirements for organizations to collect, use, and disclose personal information. This included seeking consent, purpose limitation, limiting collection, ensuring accuracy, security, and safeguards of the user data with transparency on data usage, compliance, and user accessibility. PIPEDA is similar to Europe’s General Data Protection Regulation (GDPR), which provides equivalent data protection and facilitates the efficient transfer of data between Canada and the EU. It applies across such industries as banking, broadcasting, and healthcare. --- ### Proof of Address (PoA) > Find out which documents are accepted as proof of address (PoA) and which companies are required to conduct address verification checks. - Published: 2024-07-11 - Modified: 2024-07-11 - URL: https://www.idenfy.com/glossary/proof-of-address/ Proof of address (PoA) is a type of document that companies require when they need to comply with regulations to confirm a customer’s current residential address. A valid PoA should have the name, current residential address, and the issuing authority’s contact details. This document is required for the proof of address verification process, which is often conducted online and requires users to provide a photo or a PDF file of a recent PoA document (dated in the last three months) to verify its authenticity. Some companies compare the address data with previously provided information and conduct additional database checks to ensure that the address is genuine. --- ### Utility Bill > Learn what makes a utility bill a valid form of Proof of Address (PoA) and explore the key FAQs regarding these types of documents. - Published: 2024-07-10 - Modified: 2024-07-19 - URL: https://www.idenfy.com/glossary/utility-bill/ A utility bill is a statement showing charges for different utilities, such as gas, water, electricity, or internet. This document shows a fixed charge a business or a household needs to pay for the services and contains important data, like account number, payment due date, name, and address. Since utility bills are typically dated, they are used as proof of address (PoA) documents. In simple words, any document from a utility service provider showing the issuing date, the person’s name, address, and usage charges can be considered a utility bill. These documents are sent monthly, or sometimes several times a year, by email or post. --- ### KYC Risk Rating > Learn why KYC Risk Rating is important, access related FAQs, and find out the key KYC/AML requirements in one place. - Published: 2024-07-09 - Modified: 2024-07-09 - URL: https://www.idenfy.com/glossary/kyc-risk-rating/ KYC, or Know Your Customer risk rating, is an evaluation process used by companies to assess money laundering risks linked with each customer. It’s called a risk rating because this process uses special customer risk scores, assigning low, medium, and high scores to each user based on their potential risk. This process is often conducted automatically through AI-powered KYC compliance software (and KYB or Know Your Business software for corporate clients) to improve the accuracy and efficiency of the screening. In general, this assessment prevents companies from doing business with individuals or entities involved in financial crimes like money laundering or terrorist financing. --- ### UK Online Safety Bill > See the most important FAQs regarding the UK Online Safety Bill, which involves more stringent age verification requirements for online platfroms. - Published: 2024-07-09 - Modified: 2024-07-09 - URL: https://www.idenfy.com/glossary/uk-online-safety-bill/ The UK Online Safety Bill, also known as the Online Safety Act 2023, is a set of laws and regulations aimed at protecting adults and minors from harmful content online. The core of this Act is to enforce social media companies' responsibility to ensure the safety of their users on their platforms. To put it simply, the Online Safety Bill helps online platforms prevent children from accessing harmful and age-inappropriate content. He provides parents and children with clear and accessible ways to report problems online when they arise. --- ### Generative AI Fraud > Find out what generative AI fraud really is and learn about new, highly sophisticated deepfake attacks, fraudulent methods to fake ID documents, and more. - Published: 2024-07-03 - Modified: 2024-08-27 - URL: https://www.idenfy.com/glossary/generative-ai-fraud/ Generative AI fraud is a type of artificial intelligence (AI) fraud that involves creating fake new content, such as images, videos, and sounds. This type of fraud is commonly used by criminals for identity theft, disinformation, and other types of fraud and financial crimes. For example, deepfakes are used in this sense. In general, generative AI mimics human intelligence and can learn and apply knowledge in areas like programming, art, language, or science. Companies can use generative AI for product design, implementing virtual assistants, etc. Despite the positive use cases, by using this AI advancement, criminals can create new fraud risks, especially when it comes to bypassing Know Your Customer (KYC) checks. --- ### Federal Trade Commission (FTC) > Find out what is the exact role f the Federal Trade Commission (FTC), its mission and updates linked to the use of AI, data protection, and more. - Published: 2024-07-02 - Modified: 2024-07-02 - URL: https://www.idenfy.com/glossary/federal-trade-commission-ftc/ The Federal Trade Commission (FTC) is an independent government agency in the US that enforces various antitrust and consumer protection laws in order to prevent unfair business practices. Its mission is based on efforts to safeguard consumers and encourage fair competition to impact economic well-being. The FTC works together with the Department of Justice to enforce these laws in different commerce sectors, including banks, insurance companies, non-profits, transportation, and others. Some of their everyday activities include sharing their expertise with federal and state legislature and international government agencies, as well as developing policy and research tools through workshops or conferences. --- ### Online Safety Act 2023 > Find out the key FAQs and recent updates regarding the UK's Online Safety Act 2023, including the measures regulated online platforms should take. - Published: 2024-06-26 - Modified: 2024-06-26 - URL: https://www.idenfy.com/glossary/online-safety-act-2023/ The Online Safety Act 2023 is a UK law aimed at safeguarding both children and adults on the internet. It is built to safeguard messaging and social media apps as well as search engines to ensure safety for its users, imposing additional responsibilities on these companies. That means they are required to establish policies and procedures to minimize the risks of their services being used for illegal activities. Under the Act, platforms must be clear about what harmful content they allow and give users more say in what they see. Companies are required to remove illegal content once it is identified. Additionally, service providers must stop children from seeing age-inappropriate content and offer easy ways for parents to report such safety issues. --- ### Deepfake > Find out the antics and the specifics behind deepfake technology, getting a quick glimpse into its history, definition, and more burning FAQs. - Published: 2024-06-26 - Modified: 2024-06-26 - URL: https://www.idenfy.com/glossary/deepfake/ A deepfake is a digitally manipulated form of media that uses artificial intelligence (AI) to replace a person’s face or body with digitally altered elements to make them look like someone else. This convincing tactic is often used with malicious intent to deceive people and spread misinformation. The term was invented in 2017 by a Reddit user named "deepfakes. " This is where the deepfake trend started. However, Reddit has since banned its "deepfakes" community, which had nearly 100,000 members and was known for creating AI-generated face-swapped celebrity video clips. The “deepfake” term now includes any AI-generated videos, pictures, or audio designed to appear real, such as realistic images of nonexistent people or celebrities. --- ### Gambling Act 2005 > Access the main questions and answers regarding the most important gambling and iGaming regulation rule set in the UK, the Gambling Act 2005. - Published: 2024-06-25 - Modified: 2024-07-03 - URL: https://www.idenfy.com/glossary/gambling-act-2005/ The Gambling Act 2005 is the main legislation in the UK designed to regulate all forms of gambling, such as betting and lotteries, in order to prevent minors from accessing such services. The Act also aims to prevent crime and make the gambling sector more transparent by shifting the responsibility for licensing gambling from magistrates' courts to local authorities. To achieve these goals, the Gambling Act 2005 lists what is not allowed and the penalties for non-compliance with the Act. As a result, the Act created the Gambling Commission. Additionally, the Gambling Act 2005 specifically regulates online gambling for the first time. --- ### Virginia Age Verification Law > Access the new information and the most common FAQs regarding the Virginia Age Verification Law, requiring companies to check users' IDs and age. - Published: 2024-06-20 - Modified: 2024-06-20 - URL: https://www.idenfy.com/glossary/virginia-age-verification-law/ The Virginia Age Verification law, also known as SB 1515, requires that adult websites must verify users' age and identity but can choose the specific method of verification. For example, they can ask users to upload photos of government-issued IDs or use other technologies like biometric checks. This law also allows users to sue pornographic websites that fail to use proper age and identity verification methods for any damages resulting from a minor's access to age-restricted content. Legislators in Virginia passed a bill requiring adult websites to use more stringent age verification protocols in order to prevent minors from seeing them. That means sites providing age-restricted content must confirm users in Virginia are at least 18 years old before allowing them to view the content, according to a rule that went into effect on July 1, 2023. --- ### Utah Age Verification Law > Find out the recent updates and FAQs regarding Utah's Age Verification law, requiring age-restricted service providers integrate identity verification. - Published: 2024-06-20 - Modified: 2024-06-20 - URL: https://www.idenfy.com/glossary/utah-age-verification-law/ The Utah age verification law, known as Senate Bill 287, is a regulatory requirement mandating age-restricted service providers, such as adult-oriented content websites, to verify user age. It was passed by state lawmakers and signed by Governor Spencer Cox on 1 March 2024. Utah also includes social media companies under this age verification law. This means users will have to verify their age before usage, as they will be blocked if they don’t provide a government-issued ID document for verification. Users under 18 will also need to seek permission or consent from parents or guardians to access social media. --- ### Beneficial Owner > Explore the key FAQs regarding beneficial ownership and learn why it's important to identify a company's beneficial owner and corporate structure. - Published: 2024-06-11 - Modified: 2024-06-11 - URL: https://www.idenfy.com/glossary/beneficial-owner/ A beneficial owner is an individual who holds a percentage stake in a corporation or legal entity. They can own a part of property or asset, even though the legal title of that asset is held by someone else. Beneficial owners can have the power to vote and influence decisions related to transactions that involve that property or asset. For example, a corporate shareholder is considered a beneficial owner, and they can vote regarding the shares in a company. A beneficial owner can either own or control an interest in a legal entity or arrangement, such as a company, foundation, or trust. This concept is often used in the context of financial assets, real estate, and corporate structures to identify the true owner behind the nominal owner. --- ### USA Patriot Act > After the shocking 9/11 attack, regulators knew they needed to focus more on the terrorism and similar offences, presenting the USA Patriot Act of 2001. - Published: 2024-06-04 - Modified: 2024-06-04 - URL: https://www.idenfy.com/glossary/usa-patriot-act/ The USA Patriot Act is a set of rules and regulations that were enacted after the September 11, 2001, terrorist attacks in the US. The Patriot Act is considered to be a milestone in the regulatory landscape because it granted law enforcement agencies expanded authority to investigate, charge, and prosecute terrorists. Additionally, it imposed harsher penalties for those involved in terrorist activities. The USA Patriot Act minimized the barrier that had previously made it hard to share information between domestic law enforcement and foreign counterintelligence agencies. It was set as an improvement on a similar US law, "Antiterrorism and Effective Death Penalty Act of 1996," which was passed after the 1995 Oklahoma City bombing during President Clinton's time in office. Currently, the Patriot Act mandates that the obliged entities in the financial industry report any suspicious customer activities to combat terrorism-related money laundering. --- ### Know Your Supplier (KYS) > Discover what it really means to "know" and verify your third-party partners using a due diligence measure known as Know Your Supplier (KYS). - Published: 2024-06-04 - Modified: 2024-06-04 - URL: https://www.idenfy.com/glossary/know-your-supplier/ Know Your Supplier (KYS) is a due diligence measure that is designed to verify supplier reliability by assessing and mitigating risks linked to potential business relationships with third-party suppliers. The KYS process is important because it helps organizations prevent fraud and reputational harm. By incorporating supplier due diligence methods, businesses identify vulnerabilities in their supply chain, ensuring proper financial crime prevention. Know Your Supplier often involves conducting thorough investigations and reviews to ensure that suppliers meet specific standards of reliability — all in line with regulatory compliance. By assessing and screening third-party partners, including various suppliers, businesses ensure data accuracy and other aspects, like guaranteeing proper production standards for compliance with environmental and business integrity criteria. --- ### Age Verification System > Age gates? How about a proper age verification system, where both document verification and biometric selfie checks are combined. Explore more tips. - Published: 2024-06-04 - Modified: 2024-06-04 - URL: https://www.idenfy.com/glossary/age-verification-system/ An age verification system is a set of measures designed to confirm a person’s age, typically used by businesses that sell age-restricted products or services. E-commerce platforms, iGaming sites, or adult content apps use age verification to prevent minors from accessing restricted content. This process often involves collecting and verifying personal data, such as a government-issued ID, credit card, or biometrics. Often, companies build an age verification system that’s both secure and user-friendly using document verification. That means the customer is asked to upload a driver's license, passport, or national identity card. Then, the system verifies the document's authenticity and extracts specific information, such as the name, date of birth, and other security features. --- ### AML Screening Software > Cross-checking users against different PEPs and sanctions lists, global watchlists, adverse mediacan be all done with AML screening software. - Published: 2024-06-04 - Modified: 2024-06-04 - URL: https://www.idenfy.com/glossary/aml-screening-software/ An Anti-Money Laundering (AML) software is an automated solution that financial institutions and other regulated entities use to streamline various aspects of AML compliance, such as screening and monitoring of various databases, including identifying customers that are on sanctions list or have the Politically Exposed Person (PEP) status. Other examples of features that AML software typically carries are the ability to identify customers on regulatory blacklists or global watchlists, screen adverse media, as well as monitor client transactions to detect suspicious activity. As a result, companies can meet daily compliance requirements and detect AML risks in real-time, eliminating the need for manual and time-consuming data collection and error-prone review. --- ### Travel Rule > Find what the FATF's Travel Rule actually means for virtual asset service providers (VASPs) and more about the key crypto AML compliance measures. - Published: 2024-06-04 - Modified: 2024-06-04 - URL: https://www.idenfy.com/glossary/travel-rule/ The Travel Rule is a regulatory standard that consists of guidelines specifically targeting financial institutions involved in virtual asset transfers, such as crypto companies, collectively referred to as virtual asset service providers (VASPs). It is also known as FATF Recommendation 16 created to combat money laundering and terrorist financing, as well as prevent new financial crime opportunities that came along with virtual currencies and digital assets. Under this rule, VASPs must collect and share data regarding the sender and the receiver of the virtual asset transfer with the other financial institution or VASP before or during the transaction. The information must be collected when a certain payment threshold is reached. For example, the Financial Action Task Force (FATF) recommends a threshold of $1,000 for virtual asset transfers. --- ### CDD Final Rule > The CDD Final Rule presents stricter beneficial ownership aimed at detecting criminals who exploit companies for their illegal activities. - Published: 2024-06-04 - Modified: 2024-06-04 - URL: https://www.idenfy.com/glossary/cdd-final-rule/ The CDD Final Rule is a regulatory compliance requirement established by the Financial Crimes Enforcement Network (FinCEN), mandating that financial institutions and other regulated entities must identify and verify the identity of “natural persons” — known as beneficial owners. The CDD Final Rule is an updated version of customer due diligence (CDD) requirements for financial institutions in the United States and is also an amendment to the Bank Secrecy Act (BSA) regulations designed to enhance financial transparency and detect criminals who exploit companies for concealing their unlawful activities. --- ### Suspicious Activity Report (SAR) > Identify a potential fraud case or suspect money laundering? Yes, as per FinCEN, you must file a Suspicious Activity Report (SAR). - Published: 2024-05-03 - Modified: 2024-05-03 - URL: https://www.idenfy.com/glossary/suspicious-activity-report-sar/ A Suspicious Activity Report (SAR) is a document that requires financial institutions to report instances of potential fraud and money laundering activities. This tool was established by the Bank Secrecy Act (BSA) of 1970, and in 1996, SARs became the standard form for reporting suspicious activity. SARs serve as tools for monitoring any unusual activity within financial sectors where there’s a higher possibility of indicating potential illegal actions or posing a threat to public safety. Any activity that raises suspicion of an account holder attempting to conceal something or engage in an illegal transaction should be included in a SAR. --- ### Office of Foreign Assets Control (OFAC) > Office of Foreign Assets Control (OFAC) administers and enforces different sanctions programs, but this isn't the only area of work they do. - Published: 2024-05-03 - Modified: 2024-05-03 - URL: https://www.idenfy.com/glossary/office-of-foreign-assets-control-ofac/ The Office of Foreign Assets Control (OFAC) is an agency within the US Treasury Department which is responsible for financial intelligence and economic and trade sanctions. This regulatory authority enforces sanctions that are directed at specific foreign countries, regimes, terrorists, drug traffickers, individuals involved in weapons proliferation, and other threats to US national security, foreign policy, or economy. --- ### Financial Crimes Enforcement Network (FinCEN) > Explore FAQs linked to the Financial Crimes Enforcement Network (FinCEN): its ways for tracking suspicious activity, AML measures, and more. - Published: 2024-05-03 - Modified: 2024-05-03 - URL: https://www.idenfy.com/glossary/financial-crimes-enforcement-network-fincen/ The Financial Crimes Enforcement Network (FinCEN) is a bureau within the United States Department of the Treasury. Its primary role is to gather and assess data related to financial transactions in order to prevent and combat financial crime, such as money laundering, terrorist financing, and other illicit activities, both domestically and internationally. --- ### Financial Action Task Force (FATF) > Learn about the key players in the policy-making world, the Financial Action Task Force (FATF), and its biggest impact on regulatory reforms. - Published: 2024-05-03 - Modified: 2024-05-03 - URL: https://www.idenfy.com/glossary/financial-action-task-force-fatf/ The Financial Action Task Force (FATF) is an intergovernmental organization that develops global policies and standards designed to help combat financial crimes, such as money laundering, terrorism financing, and other risks that threaten the integrity of the financial system. The FATF was established in 1989 at the request of the G7. The Paris-based organization presents itself as the “international watchdog against money laundering and terrorist financing. ” It is well-known for its 40 Recommendations, which serve as a framework that national authorities can adapt to their own legal systems to combat illegal activities. --- ### Enhanced Due Diligence (EDD) > Enhanced due diligence (EDD) is more than just the highest level of due diligence performed for your risk-based approach to AML. Find out why. - Published: 2024-05-03 - Modified: 2024-05-03 - URL: https://www.idenfy.com/glossary/enhanced-due-diligence-edd/ Enhanced Due Diligence (EDD) is a series of extra due diligence measures that financial institutions take to examine high-risk customers and unusual transactions. This process is designed to detect and prevent potential cases of money laundering and other associated risks. The definition of enhanced due diligence applies to the extension of Know Your Customer (KYC) and anti-money laundering (AML) processes that scrutinize potential business partnerships more deeply, uncovering risks beyond what Customer Due Diligence (CDD) can detect. Establishing EDD is essential for adopting a risk-based approach to combat these risks. --- ### Document Check > Learn what a document check is in the context of identity verification and why it's a key tool to ensure Know Your Customer (KYC) compliance. - Published: 2024-05-03 - Modified: 2024-05-03 - URL: https://www.idenfy.com/glossary/document-check/ A document check is designed to verify and confirm that the document is real and suitable for its intended use. This process is often used to verify a person's identity by checking the legitimacy of documents like driver's licenses, ID cards, or passports, which are issued by official government authorities. --- ### Currency Transaction Report (CTR) > Learn what information to include in a Currency Transaction Report (CTR) for effective anti-money laundering (AML) compliance in the US. - Published: 2024-05-02 - Modified: 2024-05-02 - URL: https://www.idenfy.com/glossary/currency-transaction-report-ctr/ A Currency Transaction Report (CTR) is a tool used by financial institutions in the US to combat money laundering and other financial crimes. A CTR form is used to notify regulators of any currency transaction exceeding the standard $10,000 threshold. This measure helps monitor transactions, ensuring that the funds aren't being used for illegal activities. Currency transaction reports mandate institutions to confirm the identity and Social Security numbers (SSN) of individuals involved in large transactions, regardless of whether they hold an account with the company. Additionally, a CTR should still be submitted for smaller transactions if it seems like the customer is intentionally avoiding the threshold, a practice referred to as structuring. --- ### Anti-Money Laundering (AML) > What is AML in simple terms? Anti-money laundering (AML) refers to the laws and regulations governments create to detect and prevent crime. - Published: 2024-05-02 - Modified: 2024-07-03 - URL: https://www.idenfy.com/glossary/anti-money-laundering-aml/ Anti-money laundering (AML) is a series of legal frameworks, regulations, and procedures designed to detect and expose illicit funds that are disguised as legitimate earnings. Its primary goal is to combat the laundering of unlawfully acquired funds by criminal or terrorist organizations. AML is governed by regulations at both national and international levels, compelling entities within the financial industry, such as banks, fintech companies, and insurers, to establish internal procedures and controls while reporting to relevant authorities. Failure to comply with AML regulations can have significant repercussions for banks, including hefty non-compliance fines. --- ### Business Verification > How to get your partners and all corporate entities onboarded? Explore the basics of Business Verification and KYB automation opportunities. - Published: 2024-05-02 - Modified: 2024-05-02 - URL: https://www.idenfy.com/glossary/business-verification/ Business verification is a process designed to authenticate and assess the risk linked to another company. This includes verifying the credibility and legitimacy of any business the company engages with, including stakeholders ranging from suppliers and customers to consultants. Business verification’s main goal is to help companies identify and understand their business associates, allowing them to evaluate whether these entities pose a risk of engaging in money laundering or other fraudulent activities. The terms “business verification” and "Know Your Business" are related and often used interchangeably to describe the same process of confirming the identity and authenticity of business entities. --- ### California Consumer Privacy Act (CCPA) > Can you actually simplify your compliance processes? Yes, but for starters, you should learn about the California Consumer Privacy Act (CCPA). - Published: 2024-05-02 - Modified: 2024-05-02 - URL: https://www.idenfy.com/glossary/california-consumer-privacy-act-ccpa/ The California Consumer Privacy Act (CCPA) is a law aimed at strengthening privacy rights and safeguarding consumers in California, similar to the GDPR in Europe. It was enacted by the California State Legislature and signed into law on June 28, 2018, and became effective on January 1, 2020. Under the CCPA, companies that sell personal information must include a noticeable link on their website labeled “Do Not Sell or Share My Personal Information. ” It grants consumers the right to know what personal information is being collected, its purpose, and who it's shared with. CCPA prohibits businesses from selling personal information of individuals under 16 years old unless explicit consent is given. --- ### AMLID > Get a glimpse into AMLID, or the Anti-Money Laundering International Database, its definition, purpose and other related FAQs. - Published: 2024-05-02 - Modified: 2024-05-02 - URL: https://www.idenfy.com/glossary/amlid-2/ The Anti-Money Laundering International Database (AMLID) is a centralized database that is used globally to store information and track activities related to money laundering. It analyzes anti-money laundering (AML) laws and regulations and includes contact details for anti-money laundering authorities in various countries. AMLID serves as a valuable reference tool for law enforcement officials, investigators, and professionals handling money laundering cases across different jurisdictions. This database analyzes laws and penalties aimed at combating money laundering. AMLID also enables financial institutions and regulatory authorities to identify and prevent illicit financial transactions. --- ### AML Risk Assessment > Looking for a clear definition? Learn what measures actually complete a proper and compliant anti-money laundering (AML) risk assessment. - Published: 2024-05-02 - Modified: 2024-05-02 - URL: https://www.idenfy.com/glossary/aml-risk-assessment/ An AML risk assessment is an anti-money laundering measure designed to assess the likelihood that a customer or client may be involved in money laundering, terrorist financing, or other financial crimes. This AML process evaluates the risk level associated with each client, pinpointing specific conditions that elevate risk. An AML risk assessment involves identifying and analyzing specific risk categories, such as products, services, customers, and geographic locations, to better understand the risks associated with each area. --- ---