The law stipulates what a company’s background check must include, but how the AML (Anti-Money Laundering) and KYC (Know Your Customer) processes, or due diligence measures, are structured depends on the company’s field of activity and risks. Consequently, the procedures for all obligated entities are not always identical; rather, they vary in their thoroughness and methodology. You can read why Aaroni Accounting Services must implement due diligence measures in our blog post: “Preventing Money Laundering: Why do I need to pass an AML and KYC background check before starting cooperation, and what benefit do I get from it?“.
In Aaroni’s case, the company’s background check is more thorough because a license is required to provide contact person and trust and company services, and before receiving the license, our own background, management board, owners, and AML procedures and their quality have been state-audited. This distinguishes us from many smaller accounting firms without the aforementioned license, whose AML practices may be significantly simplified or more random in nature. To illustrate:
Simplified Approach
- Copy of an identity document;
- Quick business register search;
- Little or no risk assessment.
Thorough Approach
- Chain of beneficial owners (even multi-level);
- PEP (Politically Exposed Person), sanctions, and media check;
- Understanding the field of activity and cash flows;
- Assignment of a risk score.
You must, at this point, evaluate which approach aligns with your expectations and the nature of your business. Ultimately, the choice of which service provider you wish to cooperate with is yours. Well-designed AML and KYC processes should be one of the decision criteria. We recommend you consider the following when choosing an accounting partner:
Overly Simple Company Background Check – Not Recommended, may be easy now, but involves future risks
- “We don’t ask for anything”
- “No documents needed”
Overly Bureaucratic Company Background Check – Not Recommended, an inefficient partner
- Illogical requirements;
- Duplicate questions;
- Tardy process;
Well-Designed Company Background Check – Recommended, a reliable partner and smooth cooperation
- Clear justification;
- Risk-based approach;
- Seamless experience;
- Professional tone.
Why do we use Vespia software for company background checks?
Aaroni uses Vespia’s specialised compliance and background check tool to automate and thus accelerate AML processes, which helps us:
- Speed up data verification;
- Securely store your data;
- Identify the client and persons related to them;
- Verify companies, management board members, owners, and beneficial owners based on up-to-date data;
- Continuously assess client risks in accordance with the requirements of the Money Laundering and Terrorist Financing Prevention Act;
- Conduct international and national sanctions checks;
- Monitor changes in sanctions and risks throughout the client relationship;
- Ensure the justification and transparency of Aaroni’s AML decisions;
- Remain compliant with Estonian legislation and international standards.
The use of Vespia therefore means that our background check process:
- Is not based on random manual searches;
- Does not depend on one person’s memory or experience;
- Is systematically documented and verifiable, if necessary.
Thus, a client of a company providing accounting services must undergo AML and KYC processes, but the quality, structure, and experience of the background check are undoubtedly different for a conscious client.
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