Know Your Customer, or KYC, refers to the regulatory compliance mandate imposed on financial service providers to implement a Customer Identification Program (CIP) and perform due diligence checks before doing business with a person or entity. Section 326 of the Patriot Act deals specifically with the identification of new customers, and made extensive provisions in terms of KYC and the methods employed to verify client identities. As a result, financial institutions are now accountable for the effectiveness of their initial customer identification and ongoing KYC screening. They are also required to keep detailed records of the steps taken to verify prospective clients’ identities.
Lyons Commercial Data provides full support to financial institution clients with key tools designed to assist in Patriot Act compliance: