Public Policies

MeChat KYC/AML

MeChat Know Your Customer Policy

Article By Antonio James, MIQ

October 5, 2021, 1:48 am

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MeChat KYC/AML

When a customer (individual, trust, or business entity) wants to open a Digital Wallet, MeChat initiates the anti-money laundering regulations using data from know your customer (KYC) forms.

In most cases, it will take 2-3 days to approve a Digital Wallet application. 

In all cases, MeChat identifies Digital Wallet customers (“Customer”, “RE” or “depositor”) and applicants using MeChat’s Customer Identification Program (CIP), as well as MeChat’s Central KYC Registry, which encompasses MeChat’s Customer Due Diligence (CDD) and Know Your Client (KYC) processes. 

MeChat’s KYC/AML is not negotiable for Digital Wallets, due to the strict financial regulations and legislative obligations of MeChat’s financial underwriters and license issued by a physical bank. If the Bank is not able to identify the RE, MeChat must decline the relationship, until such time that fulsome CIP, CDD and KYC requirements have been met.

In cases where MeChat cannot identify a RE, MeChat must document the reasons that the RE could not be identified and the efforts made to identify them. These REs will be considered higher risk and Enhanced Due Diligence (“EDD”) measures will be applied by the Compliance Officer. 

In some cases, the Compliance Officer may ask a staff member to contact the RE to request additional information/documentation.

At a minimum, the following Digital Wallet information will be collected for the KYC documentation process:

  • RE Name, Business or Legal Entity Name
  • Address
  • Date of Birth (for Individuals)
  • Identification Number

MeChat opens and maintains accounts of individuals, proprietorship, partnership firms, corporates, trusts, Associations, societies, clubs etc. In order to remain compliant with local jurisdictions, MeChat enacts KYC/AML, in addition to our Terms, Privacy, and Cookie policies.

For users, convenience, once users upload officially valid data and document into forms such as for opening a bank account there information is stored so that there is no need for submitting any other documentary proof separately for similar purposes. Additionally, the data stored aids MeChat in prevent certain activities as described by the KYC/AML policy.

KYC/AML-related data can also include:

  1. blacklists,
  2. whitelists of reviewed and “safe” REs,
  3. the status of REs connected to politically exposed persons,
  4. the status of sanctions, and
  5. suspicious-activity or suspicious-transaction reports (SARs/STRs).

 

Type of Transactions

  • Fiat
  • Cryptocurrency
  • Digital Commodities: Credits

 

Anti-money laundering (AML)

MeChat follows Anti-Money Laundering (AML) regulatory processes to ensure users are who they claim to be, and that all users transactions are legitimate, combat the financing of terrorism, and to prevent perpetration of financial crime. 

MeChat AML procedures are intended to spot money laundering and record attempts to carry out high-risk transactions. Transactions that are likely to flag issues are:

  • Large cash transactions
  • Multiple unexplained transactions
  • Transactions to or from countries or people that are perceived as high-risk
  • Transactions that have no reasonable explanation

 

Know Your Customer (KYC)

KYC stands for "Know Your Customer" gives MeChat the ability to better understand our REs and therefore understanding whether or not specific people, organizations or transactions can be trusted and help MeChat manage their risks in a well-judged manner. 

The following types of users (persons/entity/beneficiaries) are treated as “Registered Entities (REs)”/ “Customers” of MeChat under KYC guidelines.

  • A person or an entity maintaining a Digital Wallet account (ACCOUNT), applying for a Digital Wallet, and or conducting business using a Digital Wallet, whom is not blacklisted, or rejected from opening a Digital Wallet.
  • Beneficiaries: On whose behalf of the account is maintained (Beneficial Owner) of the digital property, or The beneficiaries transactions conducted by professional intermediaries like stock brokers, Charted Accountants, official
  • Liquidators, Solicitors etc., as permitted by the law. or
  • Any person or entity connected with a financial transaction, which can pose significant reputation or other risks to the bank like the issue of high-value demand draft as a single transaction.

Additionally, MeChat identifies users based on subscriptions (leased properties based on risk levels) and according to their digital wallets lease: 

  • Organization: Legally established entity recorded by government jurisdiction
  • Merchant: Non-established entity (such as Freelancers, Hobbyist)
  • Buyer: Buyer, users who make purchases without the use or access to a Digital Wallet
  • Employee: users who hold a Digital Wallet, because of their employer
    • Non-Salaried: whose salary structures fluctuates, users whose accounts show small balances and low turnover,
    • Salaried: whose salary structures are well defined, users whose accounts show small balances and low turnover,
  • Government Departments and Government owned companies, regulators and statutory bodies etc.
    • entities with sources of wealth that can be easily identified and transactions in whose accounts by and large conform to the known profile, are classified as low risk REs.
    • NPOs/NGOs or its agencies are also classified as low risk REs.

To successfully ensure that our international platform can exist for free trade we need to stop bad actors or illicit organizations before negatively impact the Brand. Therefore, MeChat has one of the most robust, and comprehensive KYC profile screening, monitoring, and due diligent processes to prevent illegal activities, by pre-qualifying users by:

  • Establishing Terms for each Financial Service
  • Acquiring authorization, KYC, and identity verification before accessing a financial service that exposes MeChat to risks
  • Obtains KYC info from applicants during RE onboarding, such as:
    • Identity
    • Address of user
  • Securely store valid documents (OVDs) such as:
    • Driving License,
    • Passport,
    • Aadhar card,
    • Voter ID,
    • PAN card,
    • NREGA Job card.

Part of Knowing our Customer is knowing our partners and financial industry and therefore MeChat adjusts its Terms and Conditions according to 

 

Using RegTech for AML & KYC processes

AML checks involve ensuring all documentation are relevant to people, accounts or transactions “make sense” and are legitimate. MeChat AML process includes automating KYC and AML checks, such as: 

  • completing ID verification and monitoring
  • auditing transactions to ensure their legitimacy
  • establishing a risk profile (high/medium/low) at the time of opening of account based on rule specified under the KYC/AML guidelines.
  • using additional third-party fraud detection software for High-Risk digital properties
  • cross reference data, such as matching inputted credit card names with the Owner of the leased digital property
  • continuous monitoring and adding automated rules for transactions for suspicion
  • Following the Prevention of Money Laundering Act 2002.

When MeChat spots potential money laundering, MeChat takes measures to investigate and stop the transaction from taking place to include:

  • report suspicious activity to the correct authorities.

 

 

 

 

 

#KYC/AML #KYC #Know Your Customer #Banking #MeChat
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