RegulatoryExams
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Know Your Customer (KYC)

Also known as: KYC, customer due diligence, CDD

The FICA process of identifying and verifying who your client is before doing business with them.

Know Your Customer (KYC), also called customer due diligence, is the FICA requirement to establish and verify the identity of a client before establishing a business relationship or concluding a single transaction.

It involves obtaining identifying information (such as identity documents and proof of address), understanding the nature and purpose of the relationship, and applying enhanced due diligence to higher-risk clients.

KYC is a frontline defence against money laundering and is closely tied to the record-keeping and reporting duties under FICA.

Related terms

FICAThe Financial Intelligence Centre Act — anti-money-laundering law requiring client identification, record-keeping and reporting.Record-KeepingThe legal duty to keep records of advice, transactions and client information for the prescribed period (generally five years).

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