KYB Verification Check: 6 Steps for UK Accountants and Law Firms
In brief: A KYB verification check confirms that a business exists, is understood, is controlled by known people, and fits the firm's AML risk assessment.
Key points
- Check the entity first, then the people who own or control it.
- Companies House data is a starting point, not the whole AML file.
- A good KYB record explains business purpose, ownership, control, screening, risk rating, and review trigger.
What is a KYB verification check?
A KYB verification check is the process of confirming that a business client is real, active, understood, and controlled by identified people. For UK accountants and law firms, KYB is part of customer due diligence. It helps answer a practical question: should this firm act for this business, and what evidence supports that decision?
1. Confirm the business exists
Start with registry evidence. For UK companies, check the company number, name, status, registered office, filing history, directors, and persons with significant control. The Companies House PSC guidance explains that PSCs are people who own or control a company and are sometimes called beneficial owners.
2. Understand what the business does
Do not stop at incorporation details. Record the trading activity, expected services, source of funds, countries involved, customers, suppliers, and why the firm is being instructed.
Weak KYB files often fail here: the company exists, but nobody has recorded what the business actually does.
3. Identify ownership and control
Identify directors, partners, trustees, PSCs, ultimate beneficial owners, and anyone else exercising control. If the structure includes holding companies, overseas entities, trusts, nominees, or unusual rights, draw a simple ownership chart.
4. Verify relevant individuals
Business verification usually still requires checks on people. Verify the identity of relevant individuals and screen them where required. If one person controls the relationship but is not on the formal records, record that too.
5. Screen the business and people
Run proportionate screening for sanctions, PEP exposure, adverse media, and other risk signals. A possible match should be reviewed, not ignored. Keep a decision record for cleared or escalated matches.
6. Set the risk rating and review trigger
The final KYB output should be a decision: accepted, accepted with conditions, more evidence needed, declined, or escalated. Record the client risk rating and the next review trigger.
KYB evidence checklist
- Company registry records.
- Ownership and control notes.
- PSC or UBO information.
- Business activity and expected transaction profile.
- Identity checks for relevant individuals.
- Screening results and match decisions.
- Risk assessment and approval notes.
This guide is general information and should be applied through your firm's AML procedures.