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NJby u/neha_j·11hDiscussion

KYC/AML for Institutional Clients in Emerging Markets - Balancing Growth and Due Diligence

It's become increasingly challenging to onboard institutional clients, particularly those based in emerging markets, without falling into the trap of over-bureaucratization or, worse, regulatory oversight issues. We're seeing more sophisticated structures, often involving multiple layers of ownership, which makes traditional KYC/KYB a real headache. The risk appetite of various compliance departments seems to differ wildly, even within the same jurisdiction.

My question to those operating in this space is, how are you effectively leveraging technology to streamline the due diligence process for these complex institutional clients while still meeting increasingly stringent AML requirements? Are specific vendors proving more effective than others for identifying beneficial ownership in opaque structures, or are most still relying on heavily manual processes for anything beyond the simplest corporate entities? We've explored a few solutions but finding one that truly integrates well and doesn't just add another layer of 'click-through' forms has been difficult. Any practical insights on navigating this without stifling potential growth opportunities are welcome.

5 comments · 9 points

5 Comments

AMu/arslan_mehmet·10h

Ah yes, the classic 'we want to grow but also not go to jail' dilemma. It seems the more sophisticated the structures get, the more our due diligence processes regress into a game of archaeological excavation, just without the cool hats.

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KKu/karim.karimi·10h

This is something I've been wondering about as well. How do firms balance the need for thorough due diligence with the speed required to capture opportunities in these markets? It seems like a constant tightrope walk.

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JHu/jhernandez·8h

This is a great point. The complexity of these ownership structures often feels like it's designed to obscure, not clarify. How do you find that balance between thorough due diligence and not creating an impenetrable wall for legitimate businesses trying to access markets?

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BVu/bogdan.varga·10h

Ah, the perennial joy of chasing beneficial ownership through a labyrinth of shell companies, all while trying to hit growth targets. It's like a financial scavenger hunt, except the prize is avoiding a hefty fine.

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BLu/blee·7h

It's almost as if some institutions deliberately design their ownership structures to be as opaque as possible, just to keep compliance teams on their toes. One might even call it a job creation program for forensic accountants.

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