BVI Is Regional KYC Trendsetter

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Clifton Skelton/BVI Platinum News

(PLTM) - Businesses and entities in the Territory are now able to verify the identities of clients electronically, thanks to the amendments that have been made to the British Virgin Islands' Anti-Money Laundering and Terrorist Financing Code of Practice, 2008 (the AML Code).

The changes are being celebrated by various financial companies in the Territory. However, it was BVI international practitioners Appleby and Harneys who provided an explanation of the significance of the amendment.

The amendment, which came into force on August 1, now allows businesses to use digital verification instead of being always burdened to submit hard copy proof of identity; and according to Appleby, the move “will set a new standard for Know-Your-Client ("KYC") verification in the region.”

Appleby explained that the revised code expressly allows businesses to use electronic or digital means to verify identity and to engage and rely on the data of a third party to carry out verification.

It was noted that this move ties into the new blockchain phenomena and places BVI services on the cutting edge.

According to Appleby “The changes are well-timed with an increase in digital KYC service providers, working to find solutions to the traditionally time-consuming and paper-heavy task of client due diligence. Such providers include those utilising cryptographic technologies, whereby customer information is uploaded and encrypted onto the blockchain.”

“Such solutions allow customers to maintain control of their information, whilst giving businesses direct access to data, the ability to track any alterations therein, and to rely on the immutable nature of the blockchain,” the company added.

On the other hand, Harneys noted that, “The AML Code now expands the ways a BVI institution may carry out verification procedures, whether in physical ‘wet ink’ paper form or by electronic and digital means. This verification process may include the use of proprietary software and/or programme by a BVI institution to conduct electronic/digital verification – including verification by digital, electrical, magnetic, optical, electromagnetic, biometric and photonic form.”

However, Harneys warns that, “A BVI institution relying on this type of verification, must ensure that it engages in a cyclical monitoring process (at least every three years) to keep track of any changes in the stipulated conditions or to satisfy itself as regards compliance or non-compliance with the stipulated conditions, and to act accordingly.”

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