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Fund Administrators: Stay Ahead of Your KYC Obligations

Investment fund managers and administrators have their work cut out for them: in addition to managing all of the back-room functions of running a fund, they also need to ensure their investors are being processed through effective and compliant AML & KYC checks. KYC-Chain’s proprietary Multi-Scope and Corporate Visualization tools are specially designed to expedite and optimize the process.

The fund management / administration industry has witnessed tremendous growth in recent years. With increasing complexity in financial markets and investment options, there is a growing demand for professional and specialized services to manage funds effectively. Fund administrators play a critical role in providing such services and ensuring compliance with various regulations.

But the challenge is not simple. By the nature of their business, fund managers need to carry out compliance checks on a wide range of potential and current investors, often across numerous different funds. Ensuring that investors are legitimate actors that are not engaging in financial crime — while also meeting regulatory requirements to participate in industry-specific funds — is a major challenge.

In this article, we take a look at some of the key Know Your Customer (KYC) and Anti-Money Laundering (AML) considerations and responsibilities for fund managers and administrators — and how KYC-Chain’s Multi-Scope tool allows for a streamlined approach to managing compliance obligations for multiple funds and investors. 

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Fund administration: multiple responsibilities

Fund admins are responsible for the day-to-day operations of investment funds. This includes managing fund accounting, investor services, compliance checks and regulatory reporting, and other back-office functions. The primary objective of fund administration and management is to ensure accurate and timely valuation of assets, maintenance of proper records, and distribution of profits to investors. 

In addition to fund management, fund admins also play a crucial role in compliance, including the implementation of required anti-money laundering (AML) measures. These responsibilities have become increasingly important due to the rise in financial crimes and regulatory scrutiny. Fund administrators are required to conduct thorough Know Your Customer (KYC) checks on all investors before allowing them to invest in a fund. This helps identify any potential risks associated with the investors and ensures that the funds are not used for illegal activities.

KYC/KYB for Fund Admins

KYC / AML checks are an important part of the investment process for fund admins and managers. These checks help ensure that their investors are legitimate and comply with AML and Counter-Terror Financing (CTF) laws and regulations that govern regulated businesses such as financial institutions, money managers and virtual asset service providers (VASPs). 

Fund administrators typically carry out KYC checks on their investors as part of their onboarding process. Funds are obligated by most AML regulatory regimes — including those developed by the Financial Action Task Force (FATF) and implemented in legislation such as the EU’s Anti-Money Laundering Directives and the US’ Banking Secrecy Act.  

KYC checks carried out by fund admins on their investors include verifying the identity of the investor, as well as assessing their background and financial history. Investors may be required to submit identification documents such as passports or government-issued IDs to confirm their identity. Additionally, fund administrators may also conduct background checks on investors to verify their employment history, credit score, and other relevant information.

In addition to KYC checks, fund administrators also perform other AML checks on investors. These checks are designed to prevent illegal activities such as money laundering through the investment process. 

For corporate or institutional investors, it will be necessary to carry out Know Your Business (KYB) checks that verify the organization’s identity, place of business, ownership structure and ultimate beneficial owners. Using specialized software such as KYC-Chain’s Instant Company Structure Visualization tool allows fund admins to quickly and efficiently carry out these types of checks on their corporate investors.

Fund administrators may use various tools and methods to detect any suspicious behavior or transactions from investors that could indicate potential money laundering. This includes monitoring large transactions or high-risk investments, as well as conducting ongoing due diligence on investors to ensure compliance with AML regulations.

Managing KYC / AML checks for multiple investors with Muli-Scope

Fund admins face a tough challenge if they need to carry out checks on multiple investors. This challenge becomes exponentially more complex when managing multiple investors for multiple different funds. 

Adding to the challenge is that KYC/AML checks are not a simple box-checking exercise. In order to remain compliant with AML regulations, fund managers need to be carrying out ongoing monitoring of their investors in order to detect any changes to their risk profile after they have been accepted to participate in a fund. 

KYC-Chain’s Multi-Scope tool is a proprietary feature of our end-to-end onboarding workflow. 

Designed for users who need to have an overview and control of siloed onboarding scopes — such as for corporate subsidiaries or different funds — Multi-Scope allows managers who are responsible for multiple funds to have a unified but segregated overview of each fund’s investors. 

Each fund and its associated compliance processes are integrated in a single platform — or “instance” — managed and viewable by the overarching fund manager. 

At the same time, each individual fund’s KYC processes — termed a ‘scope’ — can be configured individually, ensuring compliance with the particular KYC/AML regulations that apply to the industries, assets and jurisdictions that are relevant to the fund. 

How KYC-Chain can help Fund Administrators

Investor risk and onboarding

Using thorough and consistent KYC checks, fund managers and admins can accurately identify high-risk investors and make informed decisions on whether to accept their participation in a fund.

Create instant corporate structure visualizations

Understanding the corporate structures and ownership of corporate investors can be very challenging for human compliance teams. Using KYC-Chain’s Instant Company Structure Visualization, fund admins can easily visualize how a group of companies relate to each other, their jurisdictions, UBOs and other key information relevant to compliance. 

Manage all funds in one platform

Using KYC-Chain’s Multi-Scope tool, you can manage numerous funds in one single unified platform, providing you with greater transparency, control and efficient investor onboarding.

Comply with regulations

KYC-Chain’s end-to-end onboarding solution allows for full compliance with a diverse range of global regulatory regimes. Our technology also allows for advanced adverse media, sanctions and political exposure checks, ensuring fund admins have a comprehensive understanding of their investors. 

Protect assets and reputation

Using our advanced AML/KYC technology, funds can avoid regulatory censure, have clear and consistent records of compliance processes and protect their reputation from unwanted exposure to financial criminals or malicious actors. 


KYC/AML checks play a crucial role in maintaining the integrity and security of the investment process. By verifying the identity and legitimacy of investors, fund administrators can better protect their funds and mitigate any potential risks. 

Using advanced compliance tools such as KYC-Chain’s Multi-Scope allows fund admins and managers to have a structured and streamlined overview of their investors’ credentials, ensuring compliance with national and global AML regulations while also protecting their own business. 

Streamline and optimize all of your compliance processes in a platform that provides you with control and transparency over your funds, investors and counterparties. 

If you’re interested in finding out more about KYC-Chain’s end-to-end workflow and Multi-Scope tool, get in touch and we’ll be happy to arrange a demo