KYC (Know Your Customer) — mandatory for financial institutions (banks, stock exchanges, bookmakers, etc.) procedure for identifying counterparties. Includes selection procedures (criteria for who can become a client) and identification (passport data, biometric data), as well as transaction tracking and analysis.Analytical systems do not rely on historical data for all transactions, but on the actions of a particular client in isolation from the rest, determining its typical features and actions. If a client makes a transaction that does not fit into the pattern of his behavior, the systеm gives a signal about the need for verification. This solves the problem of clustering, separating all client transactions into normal and suspicious ones.
AML (Anti-Money Laundering) —recognition of money laundering schemes based on the analysis of aggregated data. Suspicious transactions are identified through the analysis of all available data. The problem is the so-called false positives – transactions that are not part of a criminal scheme, but from the point of view of algorithms, they look exactly like that. Therefore, AML cannot yet do without human participation. Specialists check all transactions that the algorithm considers fraudulent and, if necessary, correct errors.
Many exchanges and cryptocurrency wallets use AML validation . If dirty coins end up in the wallet, then the account will be blocked for further clarification. The user will need to provide information about the source of the asset.However, in some jurisdictions, the owner of dirty coins can be fined even for unwitting participation in money laundering.
Keep yourself safe
Purchasing cryptocurrencies on trusted, secure platforms reduces the risk of getting dirty coins. In the search for new services, trial transactions with small amounts also minimize the risk. User reviews on the Internet will also help in choosing safe sites.
You can also check the sender’s wallet address before making a trade. If, after verification, the wallet receives the status of high risk, then the transaction can be abandoned and protect yourself from risks.
You can also secure your wallet like the sender’s wallet. Before the transaction, you need to check your wallet address through the service. Next, you need to save the result, for example, as a PDF file or take a screenshot. As a result, if the account is blocked, the user will be able to provide data and confirm the purity of their assets. It is also recommended to leave confirmation of the purchase of the coin in an honest way, for example, take screenshots.
Having two wallets will help protect assets from dirty coins. One wallet is used for verified clean coins, the other for cryptocurrencies from dubious sources.
Sources: https://aussiedlerbote.de/ , https://secretmag.ru/
