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IdentityMind Global Introduces KYC and Anti-Money Laundering Plug-in for ICOs

IdentityMind Global, Digital Identities You Can Trust, an SaaS platform that builds, maintains and analyzes digital identities worldwide, allowing companies to perform identity proofing, risk-based authentication, regulatory identification, and to detect and prevent identity fraud, announced the immediate availability of its KYC Plug-in for ICOs which provides a turnkey solution for customer onboarding functionality and user experience to walk ICO participants through the know your customer (KYC) process to meet regulations worldwide. The solution enables companies to perform required KYC and anti-money laundering (AML) checks on ICO participants. Regulatory requirements to prevent fraud and money laundering are essential for the lawful distribution of tokens. Since the U.S. Securities and Exchange Commission has not yet issued a definitive ruling on ICO tokens and participation there is debate and uncertainty about which token sales are subject to securities regulations and how these rules might impact ICO-funded startups that the SEC later finds to be noncompliant.

“As ICOs become more prevalent, and as money continues to flow into ICOs, regulators globally are starting to take notice,” averred IdentityMind Global CMO Jose Caldera. “The regulatory risk, in conjunction with the risk of enabling fraudsters, financing of terrorism, and money launderers should motivate organizations performing ICOs to properly identify the participants in the ICO process. IdentityMind is at the forefront of delivering an easy compliance solution to companies conducting an ICO.”

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By all accounts, 2017 was the year ICOs went mainstream. According to industry researcher Token Report, there were approximately 266 ICOs in Q3 2017; 500 in Q4. Over $4 billion was raised through ICOs in 2017. To date, IdentityMind has reportedly realized significant customer traction in the ICO market with over 40 clients using IdentityMind to raise over $450 million.

“By working with IdentityMind, we are assuring that all participants go through KYC and AML processes before partaking in our $500 million Dragon ICO,” explained Dragon Corporation CEO and founder Chakrit Ahmad. “This is perhaps the largest ICO to date and by working with IdentityMind we’re able to verify participants on a global basis in a quick and efficient manner.”

The IdentityMind KYC plug-in for ICOs includes:

  • A web-ready software client that directs the participant through the entire KYC process.
  • A preconfigured risk-based KYC ruleset that meets the regulation of the countries where there are detailed regulations and a general KYC process for countries where regulation has not been specified. For example, the Canadian Securities Administrators have ruled that ICOs and altcoins are securities, subject to regulations on a case-by-case basis. Israel, Japan and Russia allow ICOs but warn that they are subject to future regulations. Still other countries like China and South Korea have moved to ban the creation or selling of ICOs.
  • Reports to satisfy examiners and regulatory auditors for those countries where these are specified.
  • A platform to perform enhanced due diligence for clients that require further assessment.
  • Validate the risk of Bitcoins used to participate in the ICO event.

“Aite Group research has found that there is a critical mass of young companies that are demonstrating ‘best effort’ to regulators by acting on expert advice from compliance, anti-fraud and AML professionals,” added Kristina Yee, senior analyst for Aite Group Retail Banking and Payments. “Companies planning ICOs need to work with knowledgeable service providers to implement the appropriate KYC processes. Those entities that have made no or little effort to meet compliance stand out from the compliant crowd and are vulnerable to fines and serious penalties.”


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