KYC/AML Integration with Validation Providers

1) Why it is needed and what KPIs are important

Objectives: compliance, prevention of fraud/laundering, reduction of chargebacks and risks of partners/payments with a minimum of friction.

Key metrics:

Approval rate (by market segment/payment/VIP), FPR/FNR, onboarding time (p95), player verification cost.
Hit-rate by sanctions/PEP/Adverse Media, share of manual cases, percentage of incomplete checks.
SLA provider (uptime, latency, p95 response), retrai/integration errors.

2) Basic integration architecture

Layers:

1. Orchestrator (your risk-onboarding service): route requests between providers according to rules/countries/types of verification.

2. Providers SDK/API: KYC (ID + Liveness), AML (санкции/PEP/Adverse Media), Address, Age, Device.

3. Feature Store/Risk Engine: stores results, flags, features for scoring and anti-fraud.

4. Case management: manual checks, appeals, second-line review.

5. Audit & Compliance: unchangeable decision logs, versioning of rules/models, reports to the regulator.

Event flows:

Registration → Age/ID.
First Deposit/Within → Enhanced Due Diligence (EDD by amount/risk).
Recurring AML Screening: Re-check sanctions/POP on schedule (daily/weekly).
Trigger-based: change of details/device/geo → re-screen.

3) Types of checks and what exactly they do

Document Verification: passport/ID/of water. certificate/residence permit; OCR + MRZ/Barcode, check of authenticity.

Liveness & Biometrics: active/passive liveness, face-match (selfie↔document).

Address Verification: proof of address (utility bill/bank statement), sometimes address registers.

Sanctions/PEP/Watchlists: OFAC/UN/EU/UK HMT + local; politically exposed persons; unwanted media lists/court chronicles (Adverse Media).

Age Verification: date of birth vs local thresholds.

Device/Email/Phone: risk signals (disposable domains, virtual numbers, proxy/hosting).

KYB (for partners/merchants): statutory documents, beneficiaries (UBO), registration registers, negative news.

4) Orchestration and risk-based approach

Routing rules: document country → provider A, if there is no coverage → provider B; VIP/High → EDD package.

Step-up logic: soft-check (data sources) → at risk we ask for selfies/documents.

Composition: the combination of AML screening + IDV + Address depends on the jurisdiction (MGA/UKGC/Curacao, etc.) and the stage of the life cycle (onboarding vs payout).

Re-screening: periodic (for example, daily by sanctions) and event (country/document change).

5) API design and integration patterns

Idempotency & retries: all calls - with the idempotency key; exponential retrays, timeouts, circuit-breaker.

Webhooks: processing → completed → reviewed.

Input validation: format control (MRZ, ISO country, typing document).

Artifact storage: encryption, TTL/retention by jurisdiction, "minimum necessary" access.

Sample query (pseudo):

http
POST /kyc/start
{
"user_id": "u_123",  "flows": ["IDV","AML"],  "country_hint": "DE",  "document_types": ["PASSPORT","NATIONAL_ID"],  "webhook_url": "https://risk. example. com/webhooks/kyc"
}

Provider response:

json
{
"session_id": "sess_abc",  "status": "pending",  "redirect_url": "https://provider/flow/sess_abc"
}

Webhook result:

json
{
"session_id": "sess_abc",  "status": "approved",  "checks": {
"idv": {"liveness": "pass", "face_match": 0. 92, "doc_authenticity": "pass"},   "aml": {"sanctions": "clear", "pep": "clear", "adverse_media": "none"}
},  "risk_score": 18
}

6) Data quality: typical problems and solutions

Transliteration/variability of names: use phonotic algorithms, normalization, alias tables.

Non-Latin scripts: comparison of names in Cyrillic/Arabic/Hanzi → local comparison modules.

Date of birth/address: formatting, cross-checking with document and payment address (BIN/AVS).

False matches in sanctions/REP: setting fuzzy-score and escalation rules (young namesakes, frequent surnames).

Photo quality: UX prompts (light, frame, highlights), automatic sharpness/angle control.

7) SLA, observability and alerts

Latency targets: interactive onboarding ≤ 60-120 ms per catalog/screening request + asynchronous steps ≤ 2-3 min (documents).

Uptime: ≥ 99. 9% for critical endpoints; dual provider (active-active/active-standby).

Alerts: growth 'error _ rate', degradation 'hit _ rate', jump 'review _ rate', "quiet windows" of webhooks, OCR/Liveness delays.

Logs/tracing: correlation-ID from front to provider; masked payloads; storage of solution and reasons.

8) Case management

Case queue: priority by amount/risk/region.

Playbooks: what to request from the client (selfie again, another document, proof of address).

SLA for manual cases: p95 ≤ 24 h; high-value ≤ 2 ч.

Appeals: re-match + independent reviewer; documentation of the reasons for failure (adverse action notice).

9) Compliance and privacy

GDPR/local counterparts: purpose limitation, data minimization, access/deletion right (where applicable).

PCI DSS: if payment information is affected.

PSD2/SCA: correlation with strong authentication at payment steps.

Retention: Store only required artifacts and only as much as the law/regulator requires.

Explainability: fix "decision rationale" - what the system relied on (liveness fail, doc mismatch, PEP hit).

10) Cost and procurement model

Pricing: per-check, package rates, regional odds, EDD/Adverse Media surcharges.

Optimization: risk-based orchestration (cheap provider → expensive with folbacking), caching results on TTL, re-screen by delta.

RFP checklist: document/country coverage, liveness/face-match accuracy, sanctions/RAP update rate, latency, webhooks, SDK, reports, DPIA/certification, on-prem options, judicial/regulatory practice, references from iGaming.

11) KYB: when you work with B2B/partners

Registers: Companies House, local trade registers, UBO chains.

Documents: incorporation, statute, bank letters, directors/powers of attorney.

Screening: Sanctions/PEP for UBO and Directors, Adverse Media by Brand/Entity.

Re-screen triggers: change of director/address/beneficiary, sharp increase in turnover.

12) UX and conversion: how not to "break" onboarding

Mobile-first: SDK with auto-prompts (frame, tilt, glare protection).

Guide for the user: what to prepare in advance (document, lighting), how long the process will take.

Progress bar and clear statuses.

Graceful fallback: if the camera/sensors are not available → an alternative stream (manual upload + subsequent verification).

13) Incidents and fouls

Fail-safe mode: when the provider falls, switching to protection + applying the minimum sufficient rules.

Degradation policy: we allow only small limit deposits without withdrawal until the completion of the check.

Deferred verification: issuance of temporary limits with a note on the need for trust.

14) Integration testing and certification

Provider sandboxes: scripts for "happy "/" unhappy "paths, edge cases (highlights, cropped document, twins).

Contract tests: fixing the response scheme, migrating API versions.

Load: peak releases/promo (x5-x10 traffic), long webhooks, reorder events.

DR exercises: disconnecting one provider, dropping webhooks, rollback versions.

15) Model Decision Rules

Example decision-table (simplified):

Condition	Action	Comment
Sanctions=hit (strong match)	DENY	Escalation to compliance, report
PEP=possible + Adverse=negative	REVIEW/EDD	Add. sources of funds
Liveness=fail или FaceMatch<0. 8	RETRY (1-2 times) → REVIEW	UX hints
Address=fail + High-risk country	HOLD	Proof of address again
Clean KYC/AML + Low risk score	APPROVE	Policy Limits

16) Example of a complete case (abbreviated)

Scenario: new player from Germany, €300 deposit, bonus request.

1. Soft check (AML fast): clear.

2. IDV: passport + selfie, liveness = pass, face_match=0. 93, doc=authentic.

3. Address: utility bill passed.

4. Decision: APPROVE, output limit up to €2,000, repeated AML-re-screen daily.

5. Audit: recorded versions of the engine, provider, rules, features and rationale.

17) Implementation checklist

Orchestrator with failover and routing by jurisdiction.
Contracts/SLAs/price tags, DPIAs and legal approvals.
Webhooks, idempotency, retreats, tracing.
Case management and EDD playbooks.
Periodic re-screen and event-based triggers.
Quality monitoring (hit-rate, FPR/FNR, transit time).
Retention/Removal and Access Policy (RBAC).
DR plan and degradation exercises.

Resume Summary

A strong KYC/AML integration is not to "connect one provider," but to build an orchestration from multiple sources, where decisions are made risk-based, transparently and quickly. Combine IDV, Liveness, sanctions/REP and address, implement case management and hard auditing, keep folback providers and do not forget about UX - this way you fulfill the requirements of regulators and maintain a high conversion of onboarding.