How a compliance officer uses TakeTurns for “Know Your Customer” (KYC)

Compliance departments help ensure that their organizations are operating within the legal framework and ethical standards as defined by regulations and law.  Investment companies, including venture capital and private equity firms, need to collaborate with a wide range of external parties, such as investors, portfolio companies, regulators, and auditors, on many compliance matters.

Compliance processes such as KYC require a lot of back-and-forth document requests and questionnaires between both parties. Unfortunately, most of this is done today by email, which makes it difficult to track completion and deadlines. Compliance officers spend most of their time searching emails and attachments and sending reminders.

TakeTurns is an external collaboration platform that helps businesses maintain continuity when collaborating with people outside their organization, especially when working in arm's length scenarios such as those found in compliance.  With TakeTurns, organizations streamline communication and keep everyone on the same page, because the TakeTurns Collaboration contains all the communication and documentation related to a compliance issue.  And, upon completion the collaboration (with all content, versions, and messages) is converted into a downloadable archive for record retention purposes.

To see how TakeTurns is used in compliance, I spoke with one of our users, a compliance officer with a large venture capital firm. They’re using TakeTurns to help comply with the Customer Identification Program (CIP) requirements found in Know your Customer (KYC) regulations. 

Here's how it works

Step 1

The compliance officer creates a TakeTurns Flow that requests information and documents required by their Customer Identification Program (CIP).

• Information includes: Name, Date of birth (for individuals), Address (residential or business), Identification number (Social Security Number, Taxpayer Identification Number, or other government-issued identification number)
• And proof of identity, such as government-issued identification (e.g., passport, driver's license)

Step 2

The investor receives form and requests from the compliance team. They fulfill the requests from the compliance team, it’s clear for everyone on the team what they’ve responded to.

Step 3

Once the team verifies the investor’s identity. If documentation is missing or if additional documentation is needed, the team can make additional requests. The compliance team and investor send updates until the team has successfully verified the investor’s identity.

Step 4

Once the Flow is done, the team ends the collaboration and downloads the archive. This archive contains copies of everything exchanged between the parties and is stored in the firm's record retention systems.  This is a necessary step because, in many KYC regulations, the institution must keep records of the information obtained during the process (including identification documents) for some period of time, i.e., five years.

And finally, from a security and confidentiality perspective, none of the personally identifying information (PII) exchanged as part of the process remains in everyone’s email inboxes. The reason is that TakeTurns uses an ephemeral storage approach; after a grace period, all documents are removed from TakeTurns.

TakeTurns beyond KYC

TakeTurns can do more than KYC. It can also be used to improve all sorts of arm’s length collaborations, including collaborations with: 

• Portfolio companies:  Investors need to ensure that the company is meeting its financial and operational targets. TakeTurns allows the firm to collaborate with portfolio companies in a structured manner, with each party taking turns to provide updates, feedback, and supporting financial documents. 
• Auditors and regulators:  Regulators and auditors of all kinds ( financial, security, ESC, etc) can use TakeTurns requests to ask for specific documents and track fulfillment. That in conjunction with a complete audit trail of all communications and documents, provides the transparency required to  demonstrate compliance with regulatory requirements. 
• Internal stakeholders: While we described how TakeTurns is being used with external parties, TakeTurns also supports internal compliance collaborations, especially the document approval processes required by  FINRA 2210 or processes such as Medical-Legal-Regulatory review (Pharma).  TakeTurn’s file and collaboration history capabilities can be used to ensure that all parties are complying with the firm's policies and procedures.

Try TakeTurns: The Safer, Easier Way to Work with People Outside of Your Organization

TakeTurns is your one place to share, collect, and collaborate on business-critical documents and files with your clients, vendors, partners—or any external organization. It turns that clutter of emails, attachments, shared folders, and messages into a structured, secure, and transparent TakeTurns Flow.  Ready to improve how you collaborate externally? Try TakeTurns for free.