By Sandra Nebritova
This month, the Securities and Exchange Commission (CySEC) published a consultation paper on improving the facilitation of customer due diligence with innovative technologies.
This opens a completely new chapter for the obliged entities.
The regulator is inviting their obliged entities to speak out, assess and introduce instruments that can make them more competitive, save time and make the customer experience by far better than it used to be.
CySEC is willing to allow Companies to use RegTech, to make their internal processes and legal obligations more advanced and rapid.
Moreover, they are giving the chance for the companies to understand and evaluate whether they, actually will be able to use this option and still stay compliant.
What is customer due diligence?
The companies have an obligation to know who their customer is, and they need to be able to prove that.
This normally happens by collecting identification documents such as passport copies, utility bills and so on.
This becomes tricky when you have non-face-to-face clients, as while you might receive the necessary documents, it is very difficult to assert that the person, who is actually using the services is the same as the one for whom the documents have been provided.
Traditionally, such accounts have been classified as high risk due to that reason.
As we work globally, the majority of companies are interested in accepting clients from different jurisdictions.
The fact, that Cyprus is a member of the European Union does automatically mean, that companies based on the island, do not want to limit themselves just to local clientele.
The writer is a certified AML specialist.
This post was originally published on https://www.financialmirror.com/2020/10/23/cysec-embraces-innovation/
