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Enhanced KYC and Suitability – CFR 2024

What is the course syllabus?

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Topics covered in this chapter are:

Introduction
Overview of KYC and Suitability
- Interplay Between KYC, KYP, and Suitability
Regulatory Developments
- Client Focused Reforms (CFRs)
- Summary of Key KYC and Suitability Amendments
Exemptions from KYC and Suitability Requirements
Summary

Topics covered in this chapter are:

Introduction
General Backgrounder
Client’s Personal Circumstances
Client’s Financial Circumstances
- Annual Income
- Liquidity Needs
- Client’s Financial Assets and Net Worth
- Use of Leverage to Finance the Purchase of Securities
Client’s Investment Needs and Objectives
Client’s Investment Knowledge
Client’s Risk Profile
- Risk Capacity
- Emotional Considerations for Determining a Risk Profile (Risk Tolerance)
- Resolving conflicts between a client’s expectations and risk profile
Client’s Investment Time Horizon
Client Confirmation and Updating KYC Information
Tailoring the KYC Process
Summary

Topics covered in this chapter are:

Introduction
Suitability Considerations
- Concentration and Liquidity Considerations
- Impact of Costs
- Reasonable Range of Alternatives
- Client’s Interest First
Account Type Suitability or Appropriateness
Other Conditions That Trigger Suitability
Client- Directed Trades and Receiving Unsolicited Orders
Ongoing Management of Client Accounts
- Periodic Reviews of Client Accounts
- Client Instructions and Liquidations of Securities
- Unavailable Accounts and Services
Portfolio Approach to Suitability
Vulnerable Clients
Delegation of Suitability Responsibility and Registrable Activities
Preventing and Dealing with Unsuitable Investments
- Importance of Supplemental Information
Consequences of Noncompliance
- Disciplinary case
Summary