1. A community issue calling for a community solution …
Financial crime is top of the agenda for banks
All geographies / All types of players impacted
Significant costs at stake….
... Yet no competitive advantage for banks
Lots of duplication…
for universal challenges

2. SWIFT Financial Crime Compliance Roadmap
Live
Development
Qualification
Exploration
Standards
Sanctions list management service
Data repositories
KYC Registry
Traffic analysis
Compliance Analytics
FATF 16 information quality
Quality assurance
Sanctions Testing (testing / tuning of transaction & client systems)
AML testing & tuning
Processing services
Client/Name screening
Sanctions Screening
Traffic Restriction (RMA)
Sanctions
KYC
AML

3. The KYC Registry Eirini Fotiou www.betterkyc.com What will we present?
A short summary of the relationship SWIFT has with you
An overview of KYC challenges for financial institutions
An introduction to the SWIFT KYC Registry
What are the meeting objectives?
Discuss and understand the current KYC challenge
Agree next steps and roles

4. NON compliance can be very costly – can you afford this?

5. Comprehensive KYC: The foundation to an effective AML approach Market pressure calls for increased KYC processes:
No global standard requirements
The industry as a whole must accept new expectations and consequences of non-compliance
All banks require the same data, but there is no consistency in KYC data collection and quality assurance common to the industry

6. Today’s market: An unprecedented challenge to comply with KYC requirements
The Cost of FI KYC is becoming prohibitive
Complex and inconsistent requirements across jurisdictions
Unavailability and poor quality of information
Cumbersome, repetitive and time consuming bilateral exchanges
KYC
Utility
Increase in regulations
Increase in AML/KYC fines (>$3 billion/2 years)
Increase in KYC complexity: FATF/FATCA
As a result the industry has witnessed a new development: the growth of the KYC ‘utility’
Pain point: chasing the documents from different sources – spending too much time on that.
1. They might say yes and miss something because they don’t have time to collect everything and be cautious.
2. If they don’t have time to do the assessment properly, they say ‘no’ because they re scared and reject potential counterparties: bad for business.

7. The KYC Registry by SWIFT: Single source to collect and share your KYC data for CB
Unique Positioning for SWIFT
Single standard for KYC requirements, controlled access
Trusted 3rd party to validate & store
data with built-in access and entitlements
Unique content: SWIFT Profile, EDD data
Clearly today, banks are facing an unprecedented challenge to comply with KYC legal requirements  SWIFT value proposition
Global: Reach more than 7,000 banks active in correspondent banking, representing more than 1 million relationships
Industry-owned: well established, neutral partner renowned for driving standardised, industry-wide solutions
Benefits for the community:
Standardisation: Reduce complexity through a default set of data and documents covering all juristictions and enhanced reporting capabilities
Efficiency: Create synergies, provide the information once and collect information from a single source
Effectiveness: Create more transparency through guaranteed data quality and value-added information

8. The KYC Registry: Stronger together as a Community

9. The founding principles of the KYC Registry
Input your data only once (reduce the repetition of sharing your data with each of your correspondents)
Global standardised KYC data baseline to reduce complexity (includes EDD data)
Collaborative feature-rich platform (notifications, communication flow, access based)
Validated data you can trust (SWIFT checks their completeness, accuracy & validity before putting them in the platform & on a standard basis)
Unique value added - SWIFT Profile (Business Intelligence insights based or your traffic to show direct and indirect exposure to high risk jurisdictions – KYCC)
Community-led initiative
THESE ARE THE PRINCIPLES THAT WE FOUNDED & SUPPORTED BY THE WORKING GROUP BANKS

10. The KYC Registry – Baseline (1/2)
Entity header and details
Anglicised legal name
Trading name / Doing Business As
Registered address and country
Operating address and country
BIC and LEI
Type of entity (Head-office, subsidiary, branch)
Entity classification (Bank/Cooperative/Central Bank etc.)
Head office: legal name, country and BIC
Group parent: legal name and country
CATEGORY
DATA
SUPPORTING DOCUMENTS
I. Identification of the Customer
Anglicised legal form
Legal name in local language
Trading name in local language
Immediate previous legal name(s)
Year of last legal name change
Phone and fax
Entity’s website
Registration number
Authority issuing the reg number
Date of incorporation/establishment
Regulatory status
Primary financial regulator or supervisory authority and link to website (optional secondary)
Type of licence (full / offshore)
Licence number and authority issuing the licence
Proof of regulation and banking licence
OR Charter of law / Local decree
Extract from registers OR certificate of incorporation
Certificate of change of name
II. Ownership and Management Structure
Form of organisation:
□ Privately held
□ Publicly listed
Name and country of primary stock exchange (optional secondary)
Link to the website of the stock exchange (optional secondary)
Code of the institution on the stock exchange (optional secondary)
Bearer shares information
Shareholding companies (companies with 10% shares or more mandatory, 5% recommended for privately held and offshore banks)
Ultimate Beneficial Owners statement
Ultimate Beneficial Owners (threshold 10% ownership)
Key controllers (Board of Directors, Senior executive mgt, Supervisory Board, etc.)
Memorandum and articles of association (statutes or by-laws)
Ownership structure
Documentary proof of shareholders companies
Declaration of Ultimate Beneficial Owners
List of shareholders
Board of directors
List of senior/executive management
Supervisory/non-executive Board
Sharia Board
Latest audited annual report
Functional organisational chart
Proof of identity of UBOs and key controllers
Proof of permanent residence of UBOs and key controllers
A clear and transparent standard set of KYC data and documents as agreed & endorsed by the industry working group
Category I – Identification of the customer
Licenses and Proof of Regulation, Certificate of Incorporation etc
Category II – Ownership and management structure 
Declaration of UBO, Board of Directors Lists, AA/MA and company Shareholdings and structure, stock exchange information,
Category III – Type of business and client base 
Category IV – Compliance information
Key Compliance contact information, AML documentation, AML P& P, Wolfsberg Questionnaire, USA Patriot Act, Other Compliance Docs
Category V – Tax Information
Tax ID information, FATCA information, documentation and contact information.
Mandatory/conditional – Enhanced DD

11. The KYC Registry – Baseline (2/2)
CATEGORY
DATA
SUPPORTING DOCUMENTS
III. Type of Business and Client Base
Type of products and services offered
Type of clients
Geographical presence and reach
Industry focus
Evidence of type of customers
IV. Compliance Information
Money Laundering Reporting Officer or department contact details
Chief Compliance Officer name
AML person contact details
Number of employees
Number of AML staff
Name of AML Auditors
Questions about
Sanction lists used by the entity
PEP screening / sanctions screening / AML transaction monitoring processed used
Procedures/information gathered when establishing a customer relationship
Regulatory investigation or fines
Wolfsberg AML questionnaire completed or equivalent
Summary of AML policies/procedures or AML laws
Detailed AML policies and procedures
AML questionnaire of the entity (template)
USA Patriot Act Certification completed
MiFID questionnaire of the entity (template)
Organisational chart of the Compliance department
Response to negative statement from the press
V. Tax Information
FATCA status and classification
GIIN
FATCA contact details
Tax Identification Number and tax country(ies)
FATCA form
Mandatory/conditional – Enhanced DD

12. SWIFT Profile in a nutshell
WHAT IT IS
Does your bank have direct or indirect exposure in FATF high risk or sanctioned jurisdictions? It addresses the challenge of Know Your Customer’s Customer.
YOUR
CORRESPONDENT
COUNTRY OF YOUR CORRESPONDENT’S
COUNTERPARTY
YOUR CORRESPONDENT’S
DIRECT EXPOSURE
INDIRECT EXPOSURE
PUBLISHER OF THE SWIFT PROFILE
CONSUMER OF THE SWIFT PROFILE
YOU
COUNTRY OF
ORDERING / BENEFICIARY PARTY’S BANK
KEY BENEFITS
Provides unique insights into bank’s activity, to identify correspondents located in high risk or sanctioned jurisdictions
Based on unique factual data
Substantiates the declared behaviour & increase your credibility
Promotes a pro-active approach & improve your risk assessment
Allows focusing the dialogue with your correspondent on highest risk areas

13. SWIFT Profile: insights on KYCC
e.g. “Algeria accounts for more than 30% of Bank’s A total exposure in USD”
e.g. “Bank A has been exposed to Iran through Bank XYZ in Germany”
e.g. “Between 5 and 15% of Bank’ As inbound traffic in USD is received from counterparties located in OFAC sanctioned jurisdictions”
SCOPE
DATA
Transparency
Accurate risk assessment

14. Our Approach SWIFT has partnered with Institutions to:
Evaluate the service and discuss future evolutions (frequent consultations)
Define high risk priority countries
Build a promotional action plan
Q2 2015: Executing the plan…
For them and with them (joint events, roadshows, customer testimonials, …)
German bank:
Working with the WG banks:
Internal presentation of The KYC Registry to DB’s FI client Sales force
Helping the get organized internally (best practice from other banks)
Letter or of introduction of the KYC Registry to their correspondents
Events organized with them to promote the Registry to their FIs
various events in different locations to their FI clients

15. How managing entities at group level can benefit institutions
Global Head Office
Local Head Office
Centralize, smoothen and control your KYC activities
Greater visibility & facilitated global audit trail
Ability to link docs across the group (or have entities covered by HQ)
Benefit at a local level
Complete local data only
Ease the reporting to HQ

16. 30 Mar 2015
316 entities
106 countries
EMEA: 238
AM: 67
AP: 11

17. The Benefits Reduced complexity Greater transparency
Saves time and money 17

18. Why should banks join the KYC Registry (now)
They share their KYC data at no cost
They only pay for the data they need
They benefit from our 2015 launch offering
KYC Registry members will get free access to the KYC Registry in 2015* provided that by end of 2015, they have
- properly contributed with their data to at least 50% (or minimum 20) of their entities, and
- at least 30% (or minimum 500) of their counterparties documented on the KYC Registry
Working Group banks get 6 months for free by default and must meet 1 one of either conditions

19. ?