Know Your Customer (KYC)
The set of client identification and verification procedures required by AML/CTF regulation. The broker must collect and verify the borrower's identity, the origin of their personal contribution, and the economic rationale of their project. These due-diligence steps are documented in the file and may be audited by the ACPR. A KYC-incomplete file cannot be submitted to bank partners.
Key points
Frequently asked questions
What documents must the broker collect to meet KYC obligations?
At minimum, the broker collects a valid identity document, a recent proof of address, payslips and tax notices to verify income, and bank statements to evidence the source of the down payment. For exceptional contributions (gifts, inheritances), an additional notarial or banking document is required.
Why is KYC distinct from a simple identity check?
KYC goes beyond identity: it requires understanding the client's economic profile, the nature and coherence of their project, and above all the traceability of the funds they are contributing. The goal is to detect any suspicious flows before entering into a business relationship, in line with anti-money laundering requirements.
What does a broker risk by neglecting KYC due diligence?
In the event of an ACPR audit, a deficient KYC file can result in disciplinary sanctions up to licence withdrawal, as well as administrative fines. Beyond legal risk, the broker assumes personal liability if illicit funds pass through a file they processed without adequate due diligence.
In practice
During onboarding, the broker notices that the €50,000 personal contribution comes from a transfer received from a foreign account; they request a notarised gift certificate and a copy of the donor account statements before opening the file.
Official sources
- Article L561-5 CMF (client identification) · Légifrance
- Article L519-1 of the Monetary and Financial Code · Légifrance
- Prudential supervision and resolution authority · ACPR (Banque de France)