EIDV is becoming ever prominent in the conversation around compliance and client due diligence. Founder Imogen Benson has put together a short guide looking at what EIDV is, how it can help firms have a better risk-based approach and how Mirror can support quick and secure CDD measures.
What is Electronic Identity and Verification (EIDV)?
Electronic identity and verification (EIDV) tools exist to help regulated businesses with KYC and AML as part of Client Due Diligence (CDD) and client onboarding. For the most part, they check the authenticity and genuineness of identity and address documents, using both public and private databases to verify the information quickly and securely. It looks at personal information such as date of birth and address, which is cross-referenced against their digital footprint, and often is reliant on clients providing documents to the third party directly.
Why should I use EIDV?
The simplest answer is that people-led processes cannot spot fraudulent identity and address documentation as accurately as electronic systems can (if at all) and as a result is a higher risk to firms.
Using EIDV tools eliminates the possibility of human error, both in simple mistakes and in accepting fraudulent documents. These days, even unsophisticated fraudsters can easily provide genuine looking IDs and utility bills. An EIDV tool eliminates the possibility of your firm accepting fraudulent identity documents. This elevates the barrier for fraudsters from editing a convincing looking document to forging a biometric chip – it makes it almost impossible for a fake to get through.
In terms of address verification, EIDV greatly improves security through electronic document validation. It ensures a document is genuine, comes from the expected source (e.g. a utility company, or bank statement) and that it matches your client’s information.
Using EIDV tools also helps safeguard your client's data: firms accepting passport scans or bills over unsecured channels like email run the risk of cyberattacks where client data could be stolen. By getting the client to verify themselves electronically, you also reduce the risk that their documents could be intercepted on their way to you.
Additionally, AML checks performed are only useful if they're performed on the right person, i.e. the identity is correctly verified. By ensuring the ID and address checks are foolproof, EIDV elevates fraud protection even before PEP and sanctions screening, or third-party checks, are run.
How does the SRA feel about EIDV?
The SRA categorises an eIDV (Electronic Identity Verification) tool as an ‘electronic means to help legal practices verify an individual’s identity’, and defines three main ‘categories’ of EIDV tools:
1) Electronic means to help legal practices verify an individual’s identity
2) Corporate Registry and Beneficial Ownership checkers
3) Electronic tools to screen clients against sanctions, PEP and Adverse Media watchlists
Mirror fits into the first and third categories, but we do not provide enhanced source of wealth and source of funds checks, nor do we provide corporate registry and beneficial ownership checks for clients. Mirror can of course be used for individual PSCs, UBOs and shareholders insofar as verifying their identity and address (this can be an individual or business address).
The SRA have clear guidance on EIDV use, but ultimately they hold firms responsible for their own choice of EIDV tool, so it is important that you choose a trusted tool.
Why should I choose Mirror as my EIDV?
Mirror provides a regulated business with the technology to know their clients (KYC) and perform the required AML checks in a simple and non-intrusive way that is quick and efficient for both the business and its customers.
For id verification, Mirror conducts biometric verification including a liveness check and (usually) an NFC chip scan. Most identity documents contain a biometric chip, which is incredibly difficult to forge convincingly. This elevates the barrier to fraud greatly and ensures a document is genuine, and has not been tampered with. When we combine chip scans with traditional biometric verification, we ensure the document is in your client's possession and pertains to them.
In terms of address verification, Mirror greatly improves security through electronic document validation. In today's world, digital documents are commonly the original, so clients often end up sending PDFs of a utility bill or bank statement to their lawyer. Unfortunately, this outdated system means a lawyer has no way of knowing if the provided document is genuine. Mirror electronically verifies the origin of a document, ensuring the domain is as expected and that this domain is tied to a real-world address. We also ensure documents pertain to your client through secure live login. Simply, this means when your client provides a utility bill from Thames Water, Mirror has electronically verified that the bill comes from Thames Water, and your client legitimately has access to this document via their online account.
We do all of this in a simple app, ensuring your client can complete end-to-end ID and address verification in under five minutes.
Of course, don’t just take our word for it. We know it can be difficult to assess whether a tool actually does what it says on the box, so we have asked QC Gregory Treverton-Jones (co-author of The Solicitor’s Handbook, 2019) to complete an independent legal review of Mirror.
If you have any questions about Mirror or want to learn more about how it works, you can get in touch with our team, who will be happy to chat you through the product