What are your best practices for collecting and verifying Source of Wealth and Source of Funds documentation, especially for PEPs or high-net-worth individuals? Struggling with balancing regulatory requirements and client friction.
We try to frame it less as 'us not trusting them' and more as 'us protecting them and our firm from potential issues.' Education on regulatory requirements can sometimes help smooth things over.
Have you explored using third-party verification services for some of the heavy lifting? It can sometimes streamline the process and add an extra layer of objectivity, though it's an added cost.
Honestly, client friction is part of the game for HNWIs and PEPs. They generally expect it, and if they push back too hard, that's often a red flag in itself. Focus on clear, upfront communication.
It's tough. We usually go with a tiered approach, starting with the basics and only asking for more if the risk profile demands it. For PEPs, there's just no getting around the deep dive.