CBR to open business verification service Oct 1 on its anti-money laundering KYC platform

MOSCOW. Sept 23 (Interfax) - The Central Bank of Russia (CBR) will launch a service on its Know Your Client (KYC) platform on October 1 that will enable users to find out if an individual entrepreneur or legal entity is in the high-risk group for conducting questionable transactions, the CBR said in a statement.

Users will be able to verify their own risk level and the risk level of third parties, including potential and existing counterparties. This will enable them to reduce the risk of interacting with unethical companies, the CBR said.

If a company or individual entrepreneur believes they should not be in the "red zone" on the KYC platform, they can appeal to the CBR to reconsider the decision to put them there. But this can only be done by clients who have not been subjected to restrictive measures under anti-money laundering legislation by their bank. If such measures are already being applied, the company or individual entrepreneur can, as before, appeal to the interagency commission under the CBR.

The CBR's KYC went into full operation on July 1, 2022. As part of this service, the CBR assigns one of three risk levels to Russian legal entities and individual entrepreneurs - low, medium and high - and then informs lenders about how risky a given client's activities are in terms of anti-money laundering legislation. At present, 96.8% of bank clients are in the low-risk group, 1.9% are designated as medium-risk and 1.3% are high-risk.

The information on the KYC platform is supplementary for banks, which also assess their clients' risks independently.