12.23. DD 23: Taler KYC¶
12.23.1. Summary¶
This document discusses the Know-your-customer (KYC) and Anti-Money Laundering (AML) processes supported by Taler.
12.23.2. Motivation¶
To legally operate, Taler has to comply with KYC/AML regulation that requires banks to identify parties involved in transactions at certain points.
12.23.3. Requirements¶
Taler needs to take measures based on the following primary triggers:
Customer withdraws money over a monthly threshold
exchange triggers KYC
key: IBAN (encoded as payto:// URI)
Wallet receives (via refunds) money resulting in a balance over a threshold
this is a client-side restriction
key: reserve (=KYC account) long term public key per wallet (encoded as payto:// URI)
Wallet receives money via P2P payments
there are two sub-cases: PUSH and PULL payments
key: reserve (=KYC account) long term public key per wallet (encoded as payto:// URI)
Merchant receives money (Q: any money, or above a monthly threshold?)
key: IBAN (encoded as payto:// URI)
Reserve is “opened” for invoicing.
key: reserve (=KYC account) long term public key per wallet (encoded as payto:// URI)
Import of new sanctions lists and triggering of measures against matches of existing customer records against the list
12.23.3.1. Process requirements¶
The key consideration here is plausibilization: staff needs to check that the client-provided information is plausible. As this is highly case-dependent, this cannot be automated.
For the different measures, there are various different possible KYC/AML checks that could happen:
In-person validation by AML staff
Various forms to be filled by AML staff
Validation involving local authorities and post-office
Online validation, sometimes with multiple options (like KYC for multiple people):
Forms to be supplied by user (different types of ID)
Interactive video
Documents to be supplied (business register)
Address validation (e-mail or phone or postal)
Additionally, the process is dynamic and conditional upon various decisions:
Individual vs. business
PEP or non-PEP
Hit on sanctions list
Type of business (trust, foundation, listed on stock market, etc.)
Need for plausibilization (via documents by user or staff research)
Periodic updates (of customer data, of sanction lists) and re-assessment
There are also various outcomes:
normal operation (with expiration date)
normal operation but with AML staff investigating (new measure)
held, requesting customer documentation (new measure)
held, AML staff reviewing evidence for plausibilization (new measure)
automatically frozen until certain day (due to sanctions)
institutionally frozen until certain day (due to order by state authority)
operation is categorically not allowed (at least above certain limits)
Outcomes may also be (partially) public, that is exposed to the client. For example, we may want to tell a wallet that it has hit a hard withdraw limit, but might succeed at withdrawing a smaller amount.
The outcome of a check can set new rules or trigger another measure (the latter is conditional on reaching the expiration time of the outcome).
As a result, we largely end up in a large state machine where the AML staff has serious flexibiltiy while the user needs guidance as to the possible next moves and/or to the current state of their account (where some information must not be disclosed).
12.23.3.2. Documentation requirements¶
For each account we must:
define risk-profile (902.4, 905.1)
document the specific setup, likely not just the INI file
should have some key AMLA file attributes, such as:
File opened, file closed (keep data for X years afterwards!)
low-risk or high-risk business relationship
PEP status
business domain
authority notification dates (possibly multiple) with voluntary or mandatory notification classification
Finally, we need to produce statistics:
There must be a page with an overview of AMLA files with opening and closing dates and an easy way to determine for any day the number of open AMLA files
Technically, we also need a list of at-risk transactions and of frozen transactions, but given that we can really only freeze on an account-basis, I think there is nothing to do here
number of incidents reported (voluntarily, required)
number of business relationships at any point in time
number of risky business relationships (PEP, etc.)
number of frozen transactions (authority vs. sanction) with start-date and end-date
start-data and end-date of relationships (data retained for X years after end of relationship)
For this high-level monitoring, we need certain designated critical events to be tracked in the system statistics:
account opened
set to high risk
set to low risk
suspicious activity report filed with authority
account frozen
account unfrozen
account closed
12.23.3.3. Further considerations¶
On top of all of this, we need to plan some diagnostics to determine when components fail (such as scripts or external services providing malformed results).
Optionally, in the future, the solution should support fees to be paid by the user for voluntary KYC processes related to attestation (#7365).
12.23.4. Proposed Solution¶
We allow certain conditions to trigger a single specific measures. For the different measures, we define:
Who has to do something (AML staff, user, nobody)
Contextual input data to be provided (with templating, e.g. amount set dynamically based on the trigger)
A check to be performed (user-interactive or staff-interactive)
Another measure to take on failure of a user-interactive check
A program that uses data from the check as well as context data to determine an outcome which is the specific operational state (normal, held on staff, held on user, frozen, etc.) the account is to transition to
What information about the state to show to the user (normal, information required, pending, etc.)
For the user-interactive checks we need a SPA (for KYC) that is given:
instructions to render (with either a form to fill or links to external checks); here the context could provide an array of choices!
possibly an external check that was set up (if any); for cost-reasons, we should only do one at a time, and probably should then always redirect the browser to that check.
For the staff-interactive checks we need a SPA (for AML):
to file forms and upload documentation (without state transition)
to decide on next measure (providing context); here, the exchange needs to expose the list of available measures and required context for each
For non-interactive measures (normal operation, account frozen) we need:
Expiration time (in context)
Measure to trigger upon expiration, again with context (renew documents, resume normal operation, etc.)
We need some customer-driven interactivity in KYB/KYC process, for example the user may need to be given choices (address vs. phone, individual vs. business, order in which to provide KYC data of beneficiaries). As a result, the exchange needs to serve some SPA for measures where the user is shown the next step(s) or choices (which person to collect KYC data on, whether to run challenger on phone number of physical address, etc.). The SPA should also potentially contain a form to allow the customer to directly upload documents to us (like business registration) instead of to some KYC provider. This is because KYC providers may not be flexible enough.
Similarly, the AML staff will need to be able to trigger rather complex KYB/KYC processes, like “need KYC on X and Y and Z” or “phone number or mailing address” or “please upload form A/T/S”. Here in particular it should be possible to request not only filled forms, but arbitrary documents.
12.23.4.1. Terminology¶
Check: A check establishes a particular attribute of a user, such as their name based on an ID document and lifeness, mailing address, phone number, taxpayer identity, etc. Checks may be given context (such as whether a customer is an individual or a business) to run correctly. Checks can also be AML staff inserting information for plausibilization. Checks result in an outcome being decided by an external AML program.
Condition: A condition specifies when KYC is required. Conditions include the type of operation, a threshold amount (e.g. above EUR:1000) and possibly a time period (e.g. over the last month).
Configuration: The configuration determines the legitimization rules, and specifies which providers offer which checks at what cost.
Context: Context is information provided as input into a check and program to customize their execution. The context is initially set by the trigger, but may evolve as the account undergoes measures. For each check and program, the required context data must be specified.
Cost: How much would a client have to pay for a KYC process (if they voluntarily choose to do so for attestation).
Expiration: KYC legitimizations may be outdated. Expiration rules determine when checks have to be performed again.
Legitimization rules: The legitimization rules determine under which conditions which checks must be performend and the expiration time period for the checks.
Logic: Logic refers to a specific bit of code (realized as an exchange plugin) that enables the interaction with a specific provider. Logic typically requires configuration for access control (such as an authorization token) and possibly the endpoint of the specific provider implementing the respective API.
Measure: Describes the possible outgoing edges from one state in the state machine (including how to show the current state). Each edge is given some context and a check to be performed as well as a program to decide the outcome and the next measure.
Outcome: Describes the account state that an account ends up in due to the result of a check. Outcomes can be that an account is frozen (no transactions possible until freeze expires), held (no transactions possible until another measure has been taken), or operating normally. Outcomes also include a new set of legitimization rules to apply and an expiration time at which point a new measure will be automatically taken. Finally, parts of the outcome may be explained to the client (for example, to allow a wallet to stay below hard withdraw thresholds).
Provider: A provider performs a specific set of checks at a certain cost. Interaction with a provider is performed by provider-specific logic.
Program: An AML helper program is given context about the current state of an account and the attribute data from a check to compute the outcome. For example, a program may look at the “PEP” field of a KYC check and decide if the outcome is to put the account into
normalorheld-for-manual-reviewstate.Type of operation: The operation type determines which Taler-specific operation has triggered the KYC requirement. We support four types of operation: withdraw (by customer), deposit (by merchant), P2P receive (by wallet) and (high) wallet balance.
12.23.4.2. New Endpoints¶
The /kyc-check/ endpoint is based on the legitimization requirements
serial number and receives the business vs. individual status from the client.
Access is authenticated by also passing the hash of the payto://-URI.
(Weak authentication is acceptable, as the KYC status or the ability to
initiate a KYC process are not very sensitive.) Given this triplet, the
/kyc-check/ endpoint returns either the (positive) KYC status or redirects
the client (202) to the next required stage of the KYC process. The
redirection must be for an HTTP(S) endpoint to be triggered via a simple HTTP
GET. It must always be the same endpoint for the same client, as the
wallet/merchant backend are not required to check for changes to this
endpoint.
FIXME: update /kyc-check/ endpoint to expose public outcomes of previous checks (such as hard withdrawal limits)!
- GET /kyc-spa/{$HASH,$FILENAME}¶
A set of
/kyc-spa/$HASHGET endpoints is created per client$HASHthat serves the KYC SPA. This is where the/kyc-check/endpoint will redirect clients unless all KYC/AML requirements are satisfied. The KYC SPA will use the$HASHof its URL to initialize itself via the/kyc-info/$HASHendpoint family. The KYC SPA may download additional resources via/kyc-spa/$FILENAME. The filenames must not match base32-encoded SHA-512 hashes.
- GET /kyc-info/$HASH¶
A new set of
/kyc-info/$HASHGET endpoints is created per client$HASHto return information about the state of the KYC or AML process to the KYC SPA. The SPA uses this information to show the user an appropriate dialog. The SPA should also long-poll this endpoint for changes to the AML/KYC state. Note that this is a client-facing endpoint, so it will only provide a restricted amount of information to the customer (as some laws may forbid us to inform particular customers about their true status). The endpoint will typically inform the SPA about possible choices to proceed, such as directly uploading files, contacting AML staff, or proceeding with a particular KYC process at an external provider (such as Challenger). If the user chooses to initate a KYC process at an external provider, the SPA must request the respective process to be set-up by the exchange via the/kyc-start/endpoint.Request:
If-None-Match: The client MAY provide an
If-None-Matchheader with an ETag.- query timeout_ms=MILLISECONDS:
Optional. If specified, the exchange will wait up to MILLISECONDS for a change to a more recent legitimization measure before returning a 304 Not Modified.
Response:
- 200 OK:
The body is a KycProcessClientInformation.
Etag: Will be set to the serial ID of the measure. Used for long-polling.
interface KycProcessClientInformation { // List of requirements. requirements?: { name : KycRequirementInformation}; // True if the client is expected to eventually satisfy all requirements. // Default (if missing) is false. is_and_combinator?: boolean // List of available voluntary checks the client could pay for. // Since **vATTEST**. voluntary_checks?: { name : KycCheckInformation}; }
interface KycRequirementInformation { // Which form should be used? Common values include "INFO" // (to just show the descriptions but allow no action), // "LINK" (to enable the user to obtain a link via // /kyc-start/) or any build-in form name supported // by the SPA. form: string; // English description of the requirement. description: string; // Map from IETF BCP 47 language tags to localized // description texts. description_i18n ?: { [lang_tag: string]: string }; // ID of the requirement, useful to construct the // /kyc-upload/$ID or /kyc-start/$ID endpoint URLs. // Present if and only if "form" is not "INFO". id?: string; }
// Since **vATTEST**. interface KycCheckInformation { // How much would this check cost the client? cost: Amount; // English description of the check. description: string; // Map from IETF BCP 47 language tags to localized // description texts. description_i18n ?: { [lang_tag: string]: string }; }
- 204 No Content:
There are no open KYC requirements or possible voluntary checks the client might perform.
- 304 Not Modified:
The KYC requirements did not change.
- POST /kyc-upload/$ID¶
The
/kyc-upload/$IDPOST endpoint allows the SPA to upload client-provided evidence. The$IDwill be provided as part of the/kyc-infobody. This is for checks of typeFORM.Request:
Basically oriented along the possible formats of a HTTP form being POSTed. Details will depend on the form. The server will try to decode the uploaded body from whatever format it is provided in.
Response:
- 204 No Content:
The information was successfully uploaded. The SPA should fetch an updated
/kyc-info/.- 404 Not Found:
The
$IDis unknown to the exchange.- 409 Conflict:
The upload conflicts with a previous upload.
- 413 Content Too Large:
The body is too large.
- POST /kyc-start/$ID¶
The
/kyc-start/$IDPOST endpoint allows the SPA to set up a new external KYC process. It will return the URL that the client must GET to begin the KYC process. The SPA should probably open this URL in a new window or tab. The$IDwill be provided as part of the/kyc-infobody.Request:
Use empty JSON body for now.
Response:
- 200 Ok:
The KYC process was successfully initiated. The URL is in a KycProcessStartInformation object.
interface KycProcessStartInformation { // URL to open. redirect_url: string; }
- 404 Not Found:
The
$IDis unknown to the exchange.
Note
As this endpoint is involved in every KYC check at the beginning, this is also the place where we could integrate the payment process for the KYC fee in the future (since vATTEST).
- GET /kyc-proof/$H_PAYTO/$PROVIDER_SECTION¶
Upon completion of the process at the external KYC provider, the provider must trigger a GET request to a new
/kyc-proof/$H_PAYTO/$PROVIDER_SECTIONendpoint. This may be done either by redirecting the browser of the user to that endpoint. Once this endpoint is triggered, the exchange will pass the received arguments to the respective logic plugin. The logic plugin will then (asynchronously) update the KYC status of the user. The logic plugin should return a human-readable HTML page with the KYC result to the user.
- GET /kyc-webhook/*``¶
- POST /kyc-webhook/*``¶
Alternatively, the KYC confirmation may be triggered by a
/kyc-webhookrequest. As KYC providers do not necessarily support passing detailed information in the URL arguments, the/kyc-webhookonly needs to specify either thePROVIDER_SECTIONor theLOGIC(the name of the plugin implementing the KYC API). The API-specific webhook logic must then figure out what exactly the webhook is about on its own. The/kyc-webhook/endpoint works for GET or POST, again as details depend on the KYC provider. In contrast tokyc-proof, the response does NOT go to the end-users’ browser and should thus only indicate success or failure.
- POST /wallet-kyc``¶
The
/wallet-kycPOST endpoint allows a wallet to notify an exchange if it will cross a balance threshold. Here, thebalancespecified should be the threshold (from thewallet_balance_limit_without_kycarray) that the wallet would cross, and not the exact balance of the wallet. The exchange will respond with a wire target UUID. The wallet can then use this UUID to being the KYC process at/kyc-check/. The wallet must only proceed to obtain funds exceeding the threshold after the KYC process has concluded. While wallets could be “hacked” to bypass this measure (we cannot cryptographically enforce this), such modifications are a terms of service violation which may have legal consequences for the user.
- GET /aml/$OFFICER_PUB/measures¶
To enable the AML staff SPA to give AML staff a choice of possible measures, a new endpoint
/aml/$OFFICER_PUB/measuresis added that allows the AML SPA to dynamically GET the list of available measures. It returns a list of known KYC checks (by name) with their descriptions and a list of AML programs with information about the required context.Request:
FIXME: see other AML GET requests?
Response:
- 200 Ok:
Information about possible measures is returned in a AvailableMeasureSummary object.
interface AvailableMeasureSummary { // Available original measures that can be // triggered directly by default rules. roots: { "$measure_name" : MeasureInformation }; // Available AML programs. programs: { "$prog_name" : AmlProgramRequirement }; // Available KYC checks. checks: { "$check_name" : KycCheckInformation }; }
interface MeasureInformation { // Name of a KYC check. check_name: string; // Name of an AML program. prog_name: string; // Context for the check. Could be empty. context: Object; }
interface AmlProgramRequirement { // Description of what the AML program does. description: string; // List of required field names in the context // to run this AML program. // SPA must check that the AML staff is providing // adequate CONTEXT when defining a measure using // this AML program. context: string[]; // List of required attribute names in the // input of this AML program. These attributes // are the minimum that the check must produce // (it may produce more). inputs: string[]; }
interface KycCheckInformation { // Description of the KYC check. Should be shown // to the AML staff but will also be shown to the // client when they initiate the check in the KYC SPA. description: string; description_i18n: {}; // Names of the fields that the CONTEXT must provide // as inputs to this check. // SPA must check that the AML staff is providing // adequate CONTEXT when defining a measure using // this check. requires: string[]; // Names of the attributes the check will output. // SPA must check that the outputs match the // required inputs when combining a KYC check // with an AML program into a measure. outputs: string[]; // Name of a root measure taken when this check fails. fallback: string; }
- GET /aml/kyc-statistics/$NAME¶
Returns the number of KYC events matching the given event type
$NAMEin the specified time range. Note that this query can be slow as the statistics are computed on-demand. (This is OK as such requests should be rare.)Request:
FIXME: add authorization checks, as with other /aml/ requests.
- query start_date=TIMESTAMP:
Optional. Specifies the date when to start looking (inclusive). If not given, the start time of the exchange operation is used.
- query end_date=TIMESTAMP:
Optional. Specifies the date when to stop looking (exclusive). If not given, the current date is used.
Response:
interface EventCounter { // Number of events of the specified type in // the given range. cnt: Integer; }
12.23.4.3. Modifications to existing endpoints¶
When withdrawing, the exchange checks if the KYC status is acceptable. If no
KYC was done and if either the amount withdrawn over a particular timeframe
exceeds the threshold or the reserve received received a P2P transfer, then a
451 Unavailable for Legal Reasons is returned which redirects the consumer
to the new /kyc-check/ handler.
When depositing, the exchange aggregator (!) checks the KYC status and if
negative, returns an additional information field via the
aggregation_transient table which is returned via GET /deposts/ to the
merchant. This way, the merchant learns the requirement_row needed to
begin the KYC process (this is independent of the amount) at the new
/kyc-check/ handler.
When merging into a reserve, the KYC status is checked and again the
merge fails with 451 Unavailable for Legal Reasons to trigger the
KYC process.
To allow the wallet to do the KYC check if it is about to exceed a set balance
threshold, we modify the /keys response to add an optional array
wallet_balance_limit_without_kyc of threshold amounts is returned.
Whenever the wallet crosses one of these thresholds for the first time, it
should trigger the KYC process. If this field is absent, there is no limit.
If the field is provided, a correct wallet must create a long-term
account-reserve key pair. This should be the same key that is also used to
receive wallet-to-wallet payments. Then, before a wallet performs an
operation that would cause it to exceed the balance threshold in terms of
funds held from a particular exchange, it should first request the user to
complete the KYC process. For that, the wallet should POST to the new
/wallet-kyc endpoint, providing its long-term reserve-account public key
and a signature requesting permission to exceed the account limit.
12.23.4.4. Configuration of external KYC providers¶
For each KYC provider that could contribute to checks the configuration
specifies a $PROVIDER_SECTION for each authentication procedure. For each
(enabled) provider, the exchange has a logic plugin which (asynchronously)
determines the redirect URL for a given wire target. See below for a
description of the high-level process for different providers.
[kyc-provider-$PROVIDER_ID] # Which plugin is responsible for this provider? LOGIC = PLUGIN_NAME # Optional cost, useful if clients want to voluntarily # trigger authentication procedures for attestation. # Since **vATTEST**. COST = EUR:5 # Plus additional logic-specific options, e.g.: AUTHORIZATION_TOKEN = superdupersecret # Other logic-specific internal options (example): FORM_ID = business_legi_form # Name of a program to run on the output of the plugin # to convert the result into the desired set of attributes. # The converter must create a log for the system administrator # if the provided inputs do not match expectations. # Note that the converter will be expected to output the # set of attributes listed under the respective ``[kyc-check-*]`` # sections. Calling the converter with ``--list-outputs`` # should generate a (newline-separated) list of attributes # the converter promises to generate in its JSON output # (when run regularly). CONVERTER = taler-exchange-helper-$NAME
12.23.4.5. Configuration of possible KYC/AML checks¶
The configuration specifies a set of possible KYC checks offered by external providers, one per configuration section:
[kyc-check-$CHECK_NAME] # Which type of check is this? Also determines # the SPA form to show to the user for this check. # # INFO: wait for staff or contact staff out-of band # (only information shown, no SPA action) # FORM: SPA should show an inline (HTML) form # LINK: SPA may start external KYC process or upload # TYPE = INFO|LINK|FORM # Optional. Set to YES to allow this check be # done voluntarily by a client (they may then # still have to pay for it). Used to offer the # SPA to display checks even if they are # not required. Default is NO. # Since **vATTEST**. VOLUNTARY = YES/NO # Provider id, present only if type is LINK. PROVIDER_ID = id # Name of the SPA form, if type is FORM # "INFO" and "LINK" are reserved and must not be used. # The exchange server and the SPA must agree on a list # of supported forms and the resulting attributes. # # The SPA should include a JSON resource file # "forms.json" mapping form names to arrays of # attribute names each form provides. FORM_NAME = name # Descriptions to use in the SPA to display the check. DESCRIPTION = "Upload your passport picture" DESCRIPTION_I18N = "{"en":"Upload scan of your passport"}" # ';'-separated list of fields that the CONTEXT must # provided as inputs to this check. For example, # for a FORM of type CHOICE, this might state # ``choices: String[];``. The type after the ":" # is for now purely for documentation and is # not checked. However, it may be shown to AML staff # when they configure measures. REQUIRES = requirement; # Description of the outputs provided by the check. # Basically, the check's output is expected to # provide the following fields as inputs into # a subsequent AML program. OUTPUTS = business_name street city country registration # **original** measure to take if the check fails # (for any reason, e.g. provider or form fail to # satisfy constraints or provider signals user error) # Usually should point to a measure that requests # AML staff to investigate. The fallback measure # context always includes the reasons for the # failure. FALLBACK = MEASURE_NAME
The list of possible FORM names is fixed in the SPA for a particular exchange release.
The outcome of any check should always be uploaded encrypted into the
kyc_attributes table. It MUST include an expiration_time.
12.23.4.6. Configuration of legitimization requirement triggers¶
The configuration also specifies a set of legitimization rules including the condition and the measure the condition triggers, one condition per configuration section:
[kyc-rule-$RULE_NAME] # Operation that triggers this legitimization. # Must be one of WITHDRAW, DEPOSIT, P2P-RECEIVE # or WALLET-BALANCE. OPERATION_TYPE = WITHDRAW # Next measures to be performed. The SPA should # display *all* of these measures to the user. # (they have a choice of either which ones, or in # which order they are to be performed). # A special measure "verboten" is used if the # threshold may never be crossed. NEXT_MEASURES = SWISSNESS KYB # Context for each of the above measures, optional. MEASURE_CONTEXT_$NAME = CONTEXT # "yes" if all REQUIRED_MEASURES will eventually need # to be satisfied, "no" if the user has a choice between # them. Not actually enforced by the exchange, but # primarily used to inform the user whether this is # an "and" or "or". YES for "and". AND_COMBINATOR = YES # YES if the rule (specifically, operation type, # threshold, timeframe) and the general nature of # the next measure (verboten or approval required) # should be exposed to the client. # Defaults to NO if not set. EXPOSED = YES # Threshold amount above which the legitimization is # triggered. The total must be exceeded in the given # timeframe. Can be 'forever'. THRESHOLD = AMOUNT # Timeframe over which the amount to be compared to # the THRESHOLD is calculated. # Ignored for WALLET-BALANCE. TIMEFRAME = DURATION # Enabled (default is NO) ENABLED = NO
12.23.4.7. AML programs¶
AML programs are helper programs that can:
Generate a list of required context field names for the helper (introspection!) using the “–required-context” command-line switch. The output should use the same syntax as the REQUIRES clause of
[kyc-check-]configuration sections, except that new lines MUST be used to separate fields instead of “;”.Generate a list of required attribute names for the helper (introspection!) using the “–required-attributes” command-line switch. The output should use the same list of names as the ATTRIBUTES in the
[kyc-provider-]configuration section (but may also include FORM field names).Process an input JSON object of type AmlProgramInput into a JSON object of type AmlProgramOutcome. This is the default behavior if no command-line switches are provided.
interface AmlProgramInput {
// JSON object that was provided as
// part of the *measure*. This JSON object is
// provided under "context" in the main JSON object
// input to the AML program. This "context" should
// satify both the REQUIRES clause of the respective
// check and the output of "--requires" from the
// AML program's command-line option.
context?: Object;
// JSON object that captures the
// output of a [kyc-provider-] or (HTML) FORM.
// The keys in the JSON object will be the attribute
// names and the values must be strings representing
// the data. In the case of file uploads, the data
// MUST be base64-encoded.
attributes: Object;
// JSON array with the results of historic
// AML desisions about the account.
// FIXME: review AmlDecisionDetail spec!
// (need to enable new outcomes!)
aml_history: AmlDecisionDetail[];
// JSON array with the results of historic
// KYC data about the account.
// FIXME: review KycDetail spec!
// (need to include AmlProgramOutcome!)
kyc_history: KycDetail[];
}
interface AmlProgramOutcome {
// Should the client's account be investigated
// by AML staff?
// Defaults to false.
to_investigate?: boolean;
// Should the client's account be frozen?
// Defaults to false.
is_frozen?: boolean;
// Was the client's account reported to the authorities?
// Defaults to false.
is_reported?: boolean;
// Free-form properties about the account.
// Can be used to store properties such as PEP,
// risk category, type of business, hits on
// sanctions lists, etc.
properties?: Object;
// Types of events to add to the KYC events table.
// (for statistics).
events?: string[];
// When does the outcome expire?
expiration: Timestamp;
// Name of the measure to apply the outcome expires.
// If not set, we revert to the default set
// of rules (and the default account state).
successor_measure: string;
// Array of KYC rules to apply. Note that this
// array overrides *all* of the default rules.
// Thus, if the array does not have an entry for
// a particular operation, there would be
// no thresholds for that operation!
rules: KycRule[];
// Custom measures that KYC rules may refer to.
custom_measures: { "name" : MeasureInformation };
}
interface KycRule {
// Type of operation to which the rule applies.
operation_type: String;
// Measure to be taken if the given
// threshold is crossed over the given timeframe.
threshold: Amount;
// Over which duration should the threshold be
// computed.
timeframe: RelativeTime;
// Array of names of measures to apply.
// Names listed can be original measures or
// custom measures from the AmlProgramOutcome.
// A special measure "verboten" is used if the
// threshold may never be crossed.
measures: String[];
// True if the rule (specifically, operation_type,
// threshold, timeframe) and the general nature of
// the measures (verboten or approval required)
// should be exposed to the client.
// Defaults to "false" if not set.
exposed?: boolean;
// True if all the measures will eventually need to
// be satisfied, false if any of the measures should
// do.
and_combinator: boolean;
}
If the AML program fails (exits with a failure code or does not provide well-formed JSON output) the AML/KYC process continues with the FALLBACK measure. This should usually be one that asks AML staff to contact the systems administrator.
AML programs are listed in the configuration file, one program per section:
[aml-program-$PROG_NAME] # Program to run. COMMAND = taler-helper-aml-pep # Human-readable description of what this # AML helper program will do. Used to show # to the AML staff. DESCRIPTION = "check if the customer is a PEP" # True if this AML program is enabled (and thus can be # used in measures and exposed to AML staff). # Optional, default is NO. ENABLED = YES # **original** measure to take if COMMAND fails # Usually points to a measure that asks AML staff # to contact the systems administrator. The fallback measure # context always includes the reasons for the # failure. FALLBACK = MEASURE_NAME
12.23.4.8. Configuration of measures¶
Finally, the configuration specifies a set of original measures one per configuration section:
[kyc-measure-$MEASURE_NAME] # Possible check for this measure. Optional. # If not given, PROGRAM should be run immediately # (on an empty set of attributes). CHECK_NAME = IB_FORM # Context for the check. The context can be # just an empty JSON object if there is none. CONTEXT = {"choices":["individual","business"]} # Program to run on the context and check data to # determine the outcome and next measure. PROGRAM = taler-aml-program
If no CHECK_NAME is provided at all, the AML PROGRAM is to be run
immediately. This is useful if no client-interaction is required to arrive at
a decision.
Note
The list of measures is not complete: AML staff may freely define new measures dynamically, usually by selecting checks, an AML program, and providing context.
12.23.4.9. Sanity checking¶
On start-up, taler-exchange-httpd should sanity-check its
configuration. Specifically, it should validate that for all AML programs the
input requirements (attributes and context) are claimed to be satisfied by the
respective checks that may trigger those programs, and similarly that for all
checks the original measures satisfy the context requirements for their KYC
checks.
As a result, any component (AML program, form or external check) is warranted to be always called with the declared required inputs. Furthermore, we can detect if a component fails to produce the required output and the configuration contains (presumably safe) FALLBACKs to address this case. The exchange MUST detect circular failures, like when a FALLBACK triggers a measure that itself immediately triggers again the same FALLBACK.
12.23.4.10. Exchange database schema¶
We introduce a new wire_targets table into the exchange database. This
table is referenced as the source or destination of payments (regular deposits
and also P2P payments). A positive side-effect is that we reduce duplication
in the reserves_in, wire_out and deposits tables as they can
reference this table.
We introduce a new legitimization_processes table that tracks the status
of a legitimization process at a provider, including the configuration section
name, the user/account name at the provider, and some legitimization
identifier for the process at the provider. In this table, we additionally
store information related to the KYC status of the underlying payto://-URI, in
particular when the KYC expires (0 if it was never done).
Finally, we introduce a new legitimization_requirements table that
contains a list of checks required for a particular wire target. When KYC is
triggered (say when some endpoint returns an HTTP status code of 451) a
new requirement is first put into the requirements table. Then, when the
client identifies as business or individual the specific legitimization
process is started. When the taler-exchange-aggregator triggers a KYC check
the merchant can observe this when a 202 (Accepted) status code is returned
on GET /deposits/ with the respective legitimization requirement row.
CREATE TABLE wire_targets
(wire_target_serial_id BIGSERIAL UNIQUE
,h_payto BYTEA NOT NULL CHECK (LENGTH(h_payto)=64),
,payto_uri STRING NOT NULL
,PRIMARY KEY (h_payto)
)
PARTITION BY HASH (h_payto);
COMMENT ON TABLE wire_targets
IS 'All recipients of money via the exchange';
COMMENT ON COLUMN wire_targets.payto_uri
IS 'Can be a regular bank account, or also be a URI identifying a reserve-account (for P2P payments)';
COMMENT ON COLUMN wire_targets.h_payto
IS 'Unsalted hash of payto_uri';
CREATE TABLE IF NOT EXISTS legitimization_measures
(legitimization_measure_serial_id BIGINT GENERATED BY DEFAULT AS IDENTITY
,h_payto BYTEA NOT NULL CHECK (LENGTH(h_payto)=32)
REFERENCES wire_targets (h_payto)
,start_time INT8 NOT NULL
,jmeasures VARCHAR[] NOT NULL
,is_and_combinator BOOL NOT NULL DEFAULT(FALSE)
,is_finished BOOL NOT NULL DEFAULT(FALSE)
)
PARTITION BY HASH (h_payto);
COMMENT ON COLUMN legitimization_requirements.start_time
IS 'Time when the measure was triggered (by decision or rule)';
COMMENT ON COLUMN legitimization_requirements.is_finished
IS 'Set to TRUE if this set of measures was processed; used to avoid indexing measures that are done';
COMMENT ON COLUMN legitimization_requirements.is_and_combinator
IS 'Set to TRUE each of the measures will ultimately need to be satisfied; FALSE if the user has the choice to satisfy one of them';
COMMENT ON COLUMN legitimization_requirements.jmeasures
IS 'array with KYC/AML measures for the account encoded in JSON';
CREATE INDEX ON legitimization_measures (h_payto)
WHERE NOT finished;
CREATE TABLE legitimization_outcomes
(outcome_serial_id BIGINT GENERATED BY DEFAULT AS IDENTITY
,h_payto BYTEA CHECK (LENGTH(h_payto)=32)
REFERENCES wire_targets (h_payto)
,decision_time INT8 NOT NULL DEFAULT(0)
,expiration_time INT8 NOT NULL DEFAULT(0)
,jproperties VARCHAR,
,to_investigate BOOL NOT NULL
,is_frozen BOOL NOT NULL
,is_reported BOOL NOT NULL
,is_active BOOL NOT NULL DEFAULT(TRUE)
,new_rules NOT NULL TEXT
)
PARTITION BY HASH (h_payto);
COMMENT ON TABLE legitimization_outcomes
IS 'Outcomes can come from AML programs';
COMMENT ON COLUMN legitimization_outcomes.h_payto
IS 'hash of the payto://-URI this outcome is about';
COMMENT ON COLUMN legitimization_outcomes.decision_time
IS 'when was this outcome decided';
COMMENT ON COLUMN legitimization_outcomes.expiration_time
IS 'time when the decision expires and the expiration new_rules should be applied';
COMMENT ON COLUMN legitimization_outcomes.jproperties
IS 'JSON with account properties, such as PEP status, business domain, risk assessment, etc.';
COMMENT ON COLUMN legitimization_outcomes.to_investigate
IS 'AML staff should investigate the activity of this account';
COMMENT ON COLUMN legitimization_outcomes.is_frozen
IS 'Transactions with this account should be held (until expiration data or AML staff action)';
COMMENT ON COLUMN legitimization_outcomes.is_reported
IS 'Set to TRUE if the activity of the account was reported to authorities';
COMMENT ON COLUMN legitimization_outcomes.is_active
IS 'TRUE if this is the current authoritative legitimization outcome';
COMMENT ON COLUMN legitimization_outcomes.new_rules
IS 'JSON array of KycRule objects to apply to the various operation types for this account; all KYC checks should first check if active new rules for a given account exist in this table (and apply specified measures); if not, it should check the default rules to decide if a measure is required';
CREATE INDEX legitimization_outcomes_active
ON legitimization_outcomes(h_payto)
WHERE is_active;
CREATE TABLE kyc_setups
(kyc_setup_serial_id BIGSERIAL UNIQUE
,h_payto BYTEA NOT NULL CHECK (LENGTH(h_payto)=64)
REFERENCES wire_targets (h_payto)
,start_time INT8 NOT NULL
,expiration_time INT8 NOT NULL DEFAULT (0)
,legitimization_measure_serial_id BIGINT
REFERENCES legitimization_measures (legitimization_measure_serial_id)
,measure_index INT8'
,provider_section VARCHAR NOT NULL
,provider_user_id VARCHAR DEFAULT NULL
,provider_legitimization_id VARCHAR DEFAULT NULL
,redirect_url TEXT DEFAULT NULL
,finished BOOLEAN DEFAULT (FALSE)
)
PARTITION BY HASH (h_payto);
COMMENT ON TABLE kyc_setups
IS 'here we track KYC processes we initiated with external providers; the main reason is so that we do not initiate a second process when an equivalent one is still active; note that h_payto, provider_section, jcontext must match and the process must not be finished or expired for an existing redirect_url to be re-used; given that clients may voluntarily initiate KYC processes, there may not always be a legitimization_measure that triggered the setup';
COMMENT ON COLUMN kyc_setups.h_payto
IS 'foreign key linking the entry to the wire_targets table, NOT a primary key (multiple KYC setups are possible per wire target)';
COMMENT ON COLUMN kyc_setups.start_time
IS 'when was the legitimization process initiated';
COMMENT ON COLUMN kyc_setups.expiration_time
IS 'when does the process expire (and needs to be manually set up again)';
COMMENT ON COLUMN kyc_setups.measure_index
IS 'index of the measure in legitimization_measures that was selected for this KYC setup; NULL if legitimization_measure_serial_id is NULL; enables determination of the context data provided to the external process';
COMMENT ON COLUMN kyc_setups.provider_section
IS 'Configuration file section with details about this provider';
COMMENT ON COLUMN kyc_setups.provider_user_id
IS 'Identifier for the user at the provider that was used for the legitimization. NULL if provider is unaware.';
COMMENT ON COLUMN kyc_setups.provider_legitimization_id
IS 'Identifier for the specific legitimization process at the provider. NULL if legitimization was not started.';
COMMENT ON COLUMN kyc_setups.legitimization_measure_serial_id
IS 'measure that enabled this setup, NULL if client voluntarily initiated the process';
COMMENT ON COLUMN kyc_setups.redirect_url
IS 'Where the user should be redirected for this external KYC process';
COMMENT ON COLUMN kyc_setups.finished
IS 'set to TRUE when the specific legitimization process is finished';
CREATE TABLE kyc_attributes
(kyc_attributes_serial_id BIGINT GENERATED BY DEFAULT AS IDENTITY
,h_payto BYTEA PRIMARY KEY CHECK (LENGTH(h_payto)=32)
REFERENCES wire_targets (h_payto)
,kyc_prox BYTEA NOT NULL CHECK (LENGTH(kyc_prox)=32)
,kyc_setup_serial_id INT8 NOT NULL
REFERENCES kyc_setups (kyc_setup_serial_id)
,collection_time INT8 NOT NULL
,expiration_time INT8 NOT NULL
,trigger_outcome_serial INT8 NOT NULL
REFERENCES legitimization_outcomes(outcome_serial_id)
,encrypted_attributes BYTEA NOT NULL
) PARTITION BY HASH (h_payto);
COMMENT ON COLUMN kyc_attributes.h_payto
IS 'identifies the account this is about';
COMMENT ON COLUMN kyc_attributes.kyc_prox
IS 'for proximity search on encrypted data';
COMMENT ON COLUMN kyc_attributes.kyc_setup_serial_id
IS 'serial ID of the KYC setup that resulted in these attributes';
COMMENT ON COLUMN kyc_attributes.collection_time
IS 'when were these attributes collected';
COMMENT ON COLUMN kyc_attributes.expiration_time
IS 'when are these attributes expected to expire';
COMMENT ON COLUMN kyc_attributes.trigger_outcome_serial
IS 'ID of the outcome that was returned by the AML program based on the KYC data collected';
COMMENT ON COLUMN kyc_attributes.encrypted_attributes
IS 'encrypted JSON object with the attribute data the check provided';
CREATE TABLE aml_history
(aml_history_serial_id BIGINT GENERATED BY DEFAULT AS IDENTITY
,h_payto BYTEA CHECK (LENGTH(h_payto)=32)
REFERENCES wire_targets (h_payto)
,legitimization_outcome INT8 NOT NULL
REFERENCES legitimization_outcomes (outcome_serial_id)
,justification TEXT NOT NULL
,decider_pub BYTEA CHECK (LENGTH(decider_pub)=32)
,decider_sig BYTEA CHECK (LENGTH(decider_sig)=64);
COMMENT ON TABLE aml_history
IS 'Records decisions by AML staff with the respective signature and free-form justification.';
COMMENT ON COLUMN aml_history.legitimization_outcome
IS 'Actual outcome for the account (included in what decider_sig signs over)';
COMMENT ON COLUMN aml_history.decider_sig
IS 'Signature key of the staff member affirming the AML decision; of type AML_DECISION';
CREATE TABLE kyc_events
(event_serial_id BIGINT GENERATED BY DEFAULT AS IDENTITY
,event_timestamp INT8 NOT NULL
,event_type TEXT NOT NULL);
COMMENT ON TABLE kyc_events
IS 'Records of key events for statistics. Populated via triggers.';
COMMENT ON COLUMN kyc_events.event_type
IS 'Name of the event, such as account-open or sar-filed';
CREATE INDEX kyc_event_index
ON kyc_events(event_type,event_timestamp);
12.23.4.11. KYC forms¶
The KYC SPA run by clients needs to support three TYPEs of checks. INFO is only about displaying the provided information, LINK is about setting up an exteral KYC check and redirecting there. FORM is about displaying a particular (HTML) form to the user and POSTing the entered information directly with the exchange. Here we describe the forms that must be supported:
CHOICE: Asks the client a multiple-choice question. The context must include “choices: String[]” with a list of choices to show. Used, for example, to ask a client if they are an individual or a business. The resulting HTML FORM field name must be “choice” and it must be mapped to strings from the choices list.
UPLOAD: Asks the client to upload a single file. The context may include “extensions: String[]” with a list of allowed file extensions the client’s file must end with (e.g. “png”, “pdf”, “gif”). In the absence of this context, any file may be uploaded. The context may also include “size_limit: Integer” with the maximum file size in bytes that can be uploaded. The resulting HTML FORM must have two fields, “filename” and “filedata”. “filename” must be set to the basename of the original file (to the extend that it is available), and “filedata” to the base64-encoding of the uploaded data.
As with other SPA checks, the KYC form should also show the description of the check.
12.23.4.12. Merchant modifications¶
A new setting is required where the merchant backend can be configured for a business (default) or individual.
We introduce new kyc_ok, aml_decision, kyc_timestamp and
exchange_kyc_serial fields into a new table merchant_kyc with primary
keys exchange_url and account_serial. This status is updated whenever
a deposit is created or tracked, or whenever the mechant backend receives a
/kyc-check/ response from the exchange. Initially,
exchange_kyc_serial is zero, indicating that the merchant has not yet made
any deposits and thus does not have an account at the exchange.
A new private endpoint /kyc is introduced which allows frontends to
request the /kyc status of any configured account (including with long
polling). If the KYC status is negative or the kyc_timestamp not recent
(say older than one month), the merchant backend will re-check the KYC status
at the exchange (and update its cached status). The endpoint then returns
either that the KYC is OK, or information (same as from the exchange endpoint)
to begin the KYC process.
The merchant backend uses the new field to remember that a KYC is pending
(after detection in taler-merchant-depositcheck) and the SPA then shows a
notification whenever the staff is logged in to the system. The notification
can be hidden for the current day (remembered in local storage).
The notification links to a (new) KYC status page. When opened, the KYC SPA
first re-checks the KYC status with the exchange. If the KYC is still
unfinished, that SPA will show forms, links or contact information to begin
the KYC process (for example, redirecting to the OAuth 2.0 login page of the
legitimization resource server), otherwise it shows that the KYC process is
done. If the KYC is unfinished, the merchant SPA should use long-polling on
the KYC status on this page to ensure it is always up-to-date, and change to
KYC satisfied should the long-poller return with positive news.
..note:
Semi-related: The TMH_setup_wire_account() is changed to use 128-bit salt values (to keep ``deposits`` table small) and checks for salt to be well-formed should be added "everywhere".
12.23.4.13. Bank requirements¶
The exchange primarily requires a KYC provider to be operated by the bank that offers an endpoint for with an API implemented by one of the logic plugins (and the respective legitimization configuration).
12.23.4.14. Logic plugins¶
The $PROVIDER_SECTION is based on the name of the configuration section,
not on the name of the logic plugin (that we call $LOGIC). Using the
configuration section, the exchange then determines the logic plugin to use.
This section describes the general API for all of the supported KYC providers, as well as some details of how this general API could be implemented by the logic for different APIs.
12.23.4.14.1. General KYC Logic Plugin API¶
This section provides a sketch of the proposed API for the KYC logic plugins.
initiation of KYC check (
kyc-check):inputs: + provider_section (for additional configuration) + h_payto
outputs: + success/provider-failure + redirect URL (or NULL) + provider_user_id (or NULL) + provider_legitimization_id (or NULL)
KYC status check (
kyc-proof):inputs: + provider_section (for additional configuration) + h_payto + provider_user_id (or NULL) + provider_legitimization_id (or NULL)
outputs: + success/pending/user-aborted/user-failure/provider-failure status code + HTML response for end-user
Webhook notification handler (
kyc-webhook):inputs: + HTTP method (GET/POST) + rest of URL (after provider_section) + HTTP body (if applicable!)
outputs: + success/pending/user-aborted/user-failure/provider-failure status code + h_payto (for DB status update) + HTTP response to be returned to KYC provider
The plugins do not directly interact with the database, the caller sets the
expiration on success and also updates provider_user_id and
provider_legitimization_id in the tables as required.
For the webhook, we need a way to lookup h_payto by other data, so the
KYC logic plugin API should be provided a method lookup with:
inputs: +
provider_section+provider_legitimization_idoutputs: +
h_payto+legitimization_process_row
12.23.4.14.2. OAuth 2.0 specifics¶
In terms of configuration, the OAuth 2.0 logic requires the respective client credentials to be configured apriori to enable access to the legitimization service.
For the /kyc-check/ endpoint, the OAuth 2.0 logic may need to create and
store a nonce to be used during /kyc-proof/, depending on the OAuth
variant used. This may require another exchange table. The OAuth 2.0 process
must then be set up to end at the new /kyc-proof/$PROVIDER_ID/ endpoint.
This /kyc-proof/oauth2/ endpoint must query the OAuth 2.0 server using the
code argument provided as a query parameter. Based on the result, it then
updates the KYC table of the exchange with the legitimization status and
returns a human-readable KYC status page.
The /kyc-webhook/ is not applicable.
12.23.4.14.3. Persona specifics¶
We would use the hosted flow. Endpoints return a request-id, which we should
log for diagnosis.
For /kyc-check/:
Post to
/api/v1/accountsusingreference-idset to ourh_payto. Returnsid(account_id).Create
/verifyendpoint usingtemplate-id(from configuration), andaccount_id(from previous step) and areference-id(use thelegitimization_serial_idfor the new process). Setredirect-urito/kyc-proof/$PROVIDER_ID/. However, we cannot rely on the user clicking this, so we must also configure a webhook. The request returns a ‘verification-id. That we store under theprovider_legitimization_idin the database.
For /kyc-proof/:
Use the
/api/v1/verificationsendpoint to get the verification status. Requires theverification-idfrom the previous step. Results include: created/pending/completed/expired (aborted)/failed.
For /kyc-webhook/:
The webhook is authenticated using a shared secret, which should be in the configuration. So all we should have to do is parse the POSTed body to find the status and the
verification-idto lookuph_paytoand return the result.
12.23.4.14.4. KYC AID specifics¶
For /kyc-check/:
Post to
/applicantswith a type (person or company) to obtainapplicant_id. Store that underprovider_user_id. ISSUE: we need to get the company_name, business_activity_id and registration_country before this somehow!start with create form URL
/forms/$FORM_ID/urlsproviding ourh_paytoas theexternal_applicant_id, using theapplicant_idfrom above, and the/kyc-proof/$PROVIDER_IDfor theredirect_url.redirect customer to the
form_url, store theverification_idunderprovider_legitimization_idin the database.
For /kyc-proof/:
Not needed, just return an error.
For /kyc-webhook/:
For security, we should probably simply trigger the GET on
/verifications/{verification_id}to not trust an unsigned POST to tell us anything for sure. The result is then returned.
12.23.4.15. Types of KYC events¶
The /aml/kyc-statistics endpoint exposes statistics
for various KYC event types.
We will initially support the use of the following types of KYC events in the SPA (and have a dialog to show the total number of any of these for any specified time range):
account-open
account-closed
voluntary-sar
mandatory-sar
pep-started
pep-ended
risky-started
risky-ended
account-frozen
account-unfrozen
Based on these, the SPA should also be albe to show active statistics (for any given timestamp) on the total number of:
open accounts
frozen accounts
high-risk accounts
PEPs served
Note
This can be done by simply running the queries with a start time of zero and subtracting.
12.23.5. Alternatives¶
We could also store the access token (returned by OAuth 2.0), but that seems slightly more dangerous and given the close business relationship is unnecessary. Furthermore, not all APIs offer this.
We could extend the KYC logic API to return key attributes about the user (such as legal name, phone number, address, etc.) which we could then sign and return to the user. This would be useful in P2P payments to identify the origin of an invoice. However, we might want to be careful to not disclose the key attributes via the API by accident. This could likely be done by limiting access to the respective endpoint to messages with a signature by the reserve private key (which is the only case where we care to certify things anyway).
12.23.6. Drawbacks¶
12.23.7. Discussion / Q&A¶
(This should be filled in with results from discussions on mailing lists / personal communication.)