Topic: AML/KYC Explained - page 13. (Read 508275 times)
AML/KYC is a barrier. I don't have a utility bill in my name. It is normal here that utility bills stay in the landlord's name.
The thread opens the eyes. From the very beginning, the authorities were interested in having a clear idea of the monetary markets / holders and were wondering about the best way to adjust fiscal rules, etc. Thus, it was only a matter of time when more stringent rules were set for exchange, it does not matter if they change fiat vs. Cryto.
Really helpful, thanks!
To expand a bit on what all this means at local level.
Services design their own AML/KYC policies and risk management processes with the over-arching guidelines and statutory requirements in mind. Conventional financial institutions tend to have extremely conservative risk assessment frameworks because they're at risk of fines in the hundreds of millions if they're found to be non-compliant.
The risk assessment/management procedures individual institutions use are developed by them. They get to decide which customers and what transactions are "high risk" and can and do choose to cease providing services to high risk accounts rather than apply enhanced AML/KYC compliance procedures to those accounts. They are under no legal obligation whatsoever to allow you to operate a high risk account and don't have to justify a refusal to do so (under some circumstances, they may even be prohibited from giving you a specific reason).
Compliance is a huge administrative burden for financial institutions and it's both cheaper and easier for them to dump accounts/customers who add to that burden. They not only don't care if you take your business elsewhere, they actively want you to do so - they want your accounts to be someone else's headache.
When your financial institution refuses to process a transaction or closes your account, they are not telling you what to do with your money. They don't actually give a fuck what you do with your money. What they're doing is refusing to act as the middleman in transactions which expose them to potential liability. Any fees they might have earned from that transaction pale into insignificance compared to the fines which allowing a single transaction which breaches AML/KYC requirements can attract (it's 11 million per breach here in Australia for a corporation and a single transaction can involve multiple breaches). It's not about your right to send funds to potentially flaky Bitcoin services or Nigerian "princes" - it's about their right (and, to a large extent, obligation) to not involve themselves in high risk transactions.
People in general greatly over-estimate their importance as customers to financial institutions. You may believe that you're giving them "a lot of business", but in the overall context of their operations you're not bringing them enough profit to justify the risks involved in servicing your account. They can always find low risk customers to replace you.
Services design their own AML/KYC policies and risk management processes with the over-arching guidelines and statutory requirements in mind. Conventional financial institutions tend to have extremely conservative risk assessment frameworks because they're at risk of fines in the hundreds of millions if they're found to be non-compliant.
The risk assessment/management procedures individual institutions use are developed by them. They get to decide which customers and what transactions are "high risk" and can and do choose to cease providing services to high risk accounts rather than apply enhanced AML/KYC compliance procedures to those accounts. They are under no legal obligation whatsoever to allow you to operate a high risk account and don't have to justify a refusal to do so (under some circumstances, they may even be prohibited from giving you a specific reason).
Compliance is a huge administrative burden for financial institutions and it's both cheaper and easier for them to dump accounts/customers who add to that burden. They not only don't care if you take your business elsewhere, they actively want you to do so - they want your accounts to be someone else's headache.
When your financial institution refuses to process a transaction or closes your account, they are not telling you what to do with your money. They don't actually give a fuck what you do with your money. What they're doing is refusing to act as the middleman in transactions which expose them to potential liability. Any fees they might have earned from that transaction pale into insignificance compared to the fines which allowing a single transaction which breaches AML/KYC requirements can attract (it's 11 million per breach here in Australia for a corporation and a single transaction can involve multiple breaches). It's not about your right to send funds to potentially flaky Bitcoin services or Nigerian "princes" - it's about their right (and, to a large extent, obligation) to not involve themselves in high risk transactions.
People in general greatly over-estimate their importance as customers to financial institutions. You may believe that you're giving them "a lot of business", but in the overall context of their operations you're not bringing them enough profit to justify the risks involved in servicing your account. They can always find low risk customers to replace you.
Great contribution. I like the new perspective your post took. Thanks
Great job! I've learned a thing or two from your post. Thanks.
thank you very much for this picked valuable info. 
If I had a merit I would share 
If I had a merit I would share
Thanks
Important aspects. But i think MTGOX should be removed from this nice article. When i see it's name i become different, furry.
Thank for you explaination.
Maged once again I have looked up what you have put together here and read through it. Just wanted to say thank you for this highly informative text, which nowadays will play a rising role and of course also in the way clients will evaluate exchanges and their offerings and how they deal with their personal data
One thing to consider is that KYC/AML apply to traditional fiat, so say an exchange like Bitmex, from what I understand, has very low hurdles for customer acquisition. I think all they need is an email. But that's because they don't actually accept fiat - everything they do is in crypto
On Poloniex and Bittrex there isn't any FIAT but yet they still fuck you with KYC and artificial withdrawal limits!
Almost all the ICO-s are using only Crypto but still want your KYC data. Why is that?
Poloniex and Bittrex are under US strict policies reason why they are imposing strict KYC. Who knows the US government already have our complete personal identifications for possible investigations. I wonder why both companies didn't transfer to different country like Malta where Binance is heading.
Thanks you for your post. I am newbie, it help me so much to understand about KYC that need for ICO project.
How come these policies can be adapted to ICOs and others projects with blockchain technologies?
One thing to consider is that KYC/AML apply to traditional fiat, so say an exchange like Bitmex, from what I understand, has very low hurdles for customer acquisition. I think all they need is an email. But that's because they don't actually accept fiat - everything they do is in crypto
On Poloniex and Bittrex there isn't any FIAT but yet they still fuck you with KYC and artificial withdrawal limits!
Almost all the ICO-s are using only Crypto but still want your KYC data. Why is that?
The worst thing is what you dont know to whom you send you documents. If you will send your passport to every ICO, what is not licensed and regulated you can be scamed (((
At what point does supposed KYC/AML compliance requirement blocking access to amounts worth below the reporting trigger limits become a deliberate scam?
I am frustrated due to getting "KYC"ed for small scale investments, i.e. they already have my coin and are changing policy. Crypto financials have an absolutely abysmal security track record, and I am unwilling to spread my data around to every two satoshi operation, it's not a case of "if" ID theft will happen it's a case of WHEN. I am absolutely convinced that if I should give full ID to 10 such operations that it's absolutely guaranteed that my data would be stolen in a year. It's very highly likely even if I restrict myself to just 5... at the moment I am only providing ID to operations located in my home country who I can get restitution from easily if/when they screw up. I had deliberately limited size of investments for risk reasons and to "not have to deal" with any AML BS.
The problem is here, my credit could be abused into the tens of thousands of dollars range, so providing full ID is an additional tens of thousands worth of risk for things likely to realize a mere hundred or two in profit, if any.
I had expected crypto to fiat interfaces to require KYC, what has caught me off guard is the number of crypto<>crypto things now beginning to implement, often with no opportunity to withdraw investment.
Exactly... And it's far worse, because there is no accountability - when compared to a Chase or BofA, etc. big institution.. At least a breach with those monkeys mean you have some control.. The random exchanges are asking for all kinds of photos of passports, or drivers licenses, etc.. So now personal info AND digital images (JPG's) are out there.. Sucks. I am frustrated due to getting "KYC"ed for small scale investments, i.e. they already have my coin and are changing policy. Crypto financials have an absolutely abysmal security track record, and I am unwilling to spread my data around to every two satoshi operation, it's not a case of "if" ID theft will happen it's a case of WHEN. I am absolutely convinced that if I should give full ID to 10 such operations that it's absolutely guaranteed that my data would be stolen in a year. It's very highly likely even if I restrict myself to just 5... at the moment I am only providing ID to operations located in my home country who I can get restitution from easily if/when they screw up. I had deliberately limited size of investments for risk reasons and to "not have to deal" with any AML BS.
The problem is here, my credit could be abused into the tens of thousands of dollars range, so providing full ID is an additional tens of thousands worth of risk for things likely to realize a mere hundred or two in profit, if any.
I had expected crypto to fiat interfaces to require KYC, what has caught me off guard is the number of crypto<>crypto things now beginning to implement, often with no opportunity to withdraw investment.
One thing to consider is that KYC/AML apply to traditional fiat, so say an exchange like Bitmex, from what I understand, has very low hurdles for customer acquisition. I think all they need is an email. But that's because they don't actually accept fiat - everything they do is in crypto
On Poloniex and Bittrex there isn't any FIAT but yet they still fuck you with KYC and artificial withdrawal limits!
Almost all the ICO-s are using only Crypto but still want your KYC data. Why is that?
One thing to consider is that KYC/AML apply to traditional fiat, so say an exchange like Bitmex, from what I understand, has very low hurdles for customer acquisition. I think all they need is an email. But that's because they don't actually accept fiat - everything they do is in crypto
whether it is a requirement to submit a KYC to a list on the exchange, and now ICO also has to submit to KYC and that I am worried about ICO or its project scam, please Explain mate, and i think not all Exchange and ICO has official Regulation.
Isn't it a time to add Circle.com to the lists?
As far as I saw they request customer information and refer to KYC during registration.I wonder, whether this makes them compliant.
As far as I saw they request customer information and refer to KYC during registration.I wonder, whether this makes them compliant.
Countries like United States and Singapore have their own set of rules regarding purchasing crypto assets and other financial services specially banking. in order to acquire digital currencies and services from bank and other financial institute one has to go through certain verification process of identity check where you have to present identity proof documents. this process is called KYC or know your customer. AML or anti money laundering is similar process conducts to prevent the criminal activities.
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