The Anti-Money Laundering Policies and KYC Procedure SwapZilla Follow Feb 27 · 2 min read

Hi. In this post, we will tell you about the anti-money laundering policies in the world and importance of Know Your Customer (KYC) procedure.

The Financial Action Task Force (FATF) and the International Monetary Fund (IMF) establish common guidelines for financial security policies at the international level. They regularly publish anti-money laundering guidelines. Within its framework, a forum was created to address issues related to the fight against money laundering at the interstate level.

In Russia, the requirements of the KYC principle are implemented primarily by the Federal Law of 07.08.2001 N 115-FZ “On combating the legalization (laundering) of proceeds from crime and the financing of terrorism” and “Regulation on the identification by credit organizations of customers, client representatives, beneficiaries and beneficiaries owners in order to counter the legalization (laundering) of proceeds from crime and the financing of terrorism.”

In the United States, there is the Patriotic Act (“The Act“ On Uniting and Strengthening America by Providing the Proper Means Required to Suppress and Prevent Terrorism ”) — a federal law that gives the state broad powers to oversee the activities of citizens, including financial transactions. In 2015, it was replaced by the United States Freedom Act, which reduces the authority of internal services to wiretap conversations.

In the United Kingdom, in 2017, the Money Laundering Regulations were created to combat money laundering. Companies in the UK are usually guided by guides issued by the Joint Money Laundering Steering Group.

The market for financial instruments expanded with the advent of digital currencies and the question of their regulation was raised. In the beginning, the privacy policy was at the forefront, but the need to ensure the security of translations led to toughening the requirements for personalization of users.

KYC stands for Know Your Client, and literally means certain “customer verification rules” used by banks, exchanges and other companies working with private individuals’ money. The essence of KYC comes down to three steps that you need to go through before conducting a financial transaction:

1. Identification of the client (who performs the operation?)

2. Legality (on what grounds is the operation carried out?)

3. The essence of the operation and its risks

These procedures are designed to help financial institutions better understand their customers and monitor transaction risks.

SwapZilla will independently monitor the reputation of its users and interact with the banks and regulatory organizations. Our platform will fully carry out all the necessary KYC procedures, monitor customer reputations and provide the technical support. The trading platforms will receive commission income from the transactions made by our users and will not incur the associated costs.