KYC & Compliance Engine
Automated Anti-Money Laundering screening, risk scoring, and regulatory-grade due diligence across 324 jurisdictions. From PEP checks to adverse media monitoring — compliance that keeps pace with global regulation.
Key features
Screen individuals and entities against 450+ global watchlists — OFAC, EU, UN, HMT, Interpol — with sub-second response and fuzzy name matching across aliases.
4-tier PEP classification (PEP-1 through PEP-4) with Relative and Close Associate mapping. Composite risk scoring from 0-100 based on 6 weighted factors.
Generate audit-ready KYC reports from Snapshot (2-3 pages) to Enhanced Due Diligence (10-20 pages) in 187+ languages with full source attribution and QR validation.
Continuous monitoring with daily re-screening, adverse media alerts, and registry change detection. Never miss a status update that affects your client portfolio.
What Is the KYC & Compliance Engine?
The KYC & Compliance Engine is Legalica's integrated anti-financial crime platform. It transforms raw entity data from the Legal Identity Hub into actionable compliance intelligence — automatically screening individuals and entities against 450+ global watchlists, identifying politically exposed persons (PEPs), mapping ultimate beneficial ownership (UBO) structures, and generating audit-ready due diligence reports.
Unlike standalone KYC tools that require manual data entry, Legalica's engine pulls directly from registry searches, document drafting workflows, and matter records. A client lookup in the Identity Hub instantly triggers a compliance cascade: sanctions check → PEP identification → adverse media sweep → risk scoring → structured report.
Built for law firms, notaries, corporate service providers, and compliance departments handling cross-border transactions, CDD/EDD obligations, and regulatory audits.
Automated AML Screening
Core Capability
Screen any individual or entity against 450+ global watchlists with sub-second response times.
Watchlist Coverage
- Sanctions Lists: OFAC (US), EU Consolidated List, UN Security Council, HMT (UK), OFSI, DFAT (Australia), Swiss SECO, Interpol Red Notices
- Law Enforcement: FBI Most Wanted, DEA Fugitives, Europol Wanted, national police databases
- Regulatory Exclusions: SEC barred individuals, FINMA, FCA enforcement, ECB decisions
- Politically Exposed Persons (PEP): PEP global database with 4-tier classification (PEP-1 through PEP-4) based on political exposure level
- Adverse Media: Real-time news scan across 75,000+ global sources, court records, and regulatory announcements
Screening Modes
Match Resolution
- Fuzzy matching across name variants, transliterations, and aliases (Levenshtein + phonetic algorithms)
- False-positive suppression via birth date, nationality, and address cross-referencing
- Manual override with audit trail for compliance officer decisions
PEP Classification System
4-Tier PEP Framework
Legalica implements a granular PEP classification that goes beyond binary PEP/non-PEP labeling:
Family & Associate Mapping
- Automatic RCA (Relative and Close Associate) detection via surname matching, address clustering, and disclosed relationship parsing
- Spouse, parent, child, sibling identification from public records
- Business associate mapping through shared directorships and UBO structures
Risk Scoring Engine
Composite Risk Algorithm
The Risk Scoring Engine produces a 0-100 risk score based on weighted factors:
Risk Bands
- 0-25: Low Risk — Standard CDD sufficient
- 26-50: Medium Risk — Enhanced monitoring recommended
- 51-75: High Risk — EDD required, senior approval for engagement
- 76-100: Critical Risk — Automatic flag, manual review mandatory, potential engagement restriction
Dynamic Re-scoring
Risk scores are not static. Legalica automatically re-scores entities when:
- New watchlist entries match existing profiles
- Adverse media appears
- UBO structure changes (new filings detected)
- Jurisdiction risk index updates (FATF list changes, etc.)
- Configurable re-screening intervals (daily/weekly/monthly)
Enhanced Due Diligence (EDD) Workflows
EDD Trigger Conditions
Enhanced Due Diligence is automatically triggered when:
- Risk score exceeds 50 (High Risk band)
- Entity is incorporated in a high-risk jurisdiction (FATF grey/black list)
- UBO structure exceeds 3 layers or crosses 2+ jurisdictions
- PEP-1 or PEP-2 identified
- Cash-intensive or high-risk sector involvement
- Manual escalation by compliance officer
EDD Report Contents
- Executive Summary — Risk score, key findings, recommendation
- Entity Profile — Full registry data, corporate history, status timeline
- UBO Structure — Visual ownership map with percentage holdings, jurisdiction flags
- Sanctions & Watchlist Results — Detailed match analysis with confidence levels
- PEP Analysis — Identified persons, tier classification, relationship mapping
- Adverse Media Review — Categorized negative news (financial crime, regulatory action, litigation, reputational)
- Jurisdiction Assessment — FATF status, CPI score, local regulatory framework
- Source Documentation — All references with timestamps, URLs, and archive links
- Compliance Recommendation — Pass / Pass with Monitoring / Restrict / Decline
KYC Report Generation
Report Types
Report Features
- Audit-ready formatting with source attribution and timestamps
- Digital signature ready — PDF/A-1b compliant archival format
- Bilingual output — Report narrative in user's language, source citations in original language
- Continuous monitoring stamps — "Valid as of [date] — next scheduled review [date]"
- QR code verification — Link to online report validation
- Custom firm branding — Logo, disclaimer, contact information
Delivery
- Instant PDF download
- Email distribution with encryption
- Matter file attachment (auto-linked to Dashboard)
- API webhook delivery for enterprise integrations
Ongoing Monitoring & Alerts
Continuous Monitoring
Legalica doesn't stop at onboarding. The monitoring engine provides:
- Daily watchlist re-screening — New sanctions, PEP changes, or enforcement actions trigger immediate alerts
- Adverse media alerts — Real-time notification when monitored entities appear in negative news
- Registry change detection — Automatic notification of filing changes, status updates, or dissolution events
- UBO change tracking — Alerts when ownership structures shift
Alert Channels
Alert Severity
- Critical (Red): Sanctions match, PEP-1 identification, dissolution event — immediate action required
- Warning (Amber): PEP-2/3, adverse media, registry change — review within 24 hours
- Info (Blue): Routine re-screening clear, minor filing update — informational only
Security & Data Governance
Zero-Data Retention (ZDR) for Screening
All AML screening queries are executed under Zero-Data Retention terms:
- Screening provider receives only the query name/entity — no client context, no matter reference
- Results are cached for 24 hours then purged (configurable per firm policy)
- No screening data is used for AI training or model improvement
- Full query audit trail maintained in firm's own Firestore instance (EU-resident)
Sovereign Eight Integration
Screening queries route through the Sovereign Eight AI Cascade for:
- Adverse media analysis — NLP extraction and risk-relevant summarization
- Report generation — Structured narrative drafting with source attribution
- Multi-language processing — Source documents in any of 187+ languages analyzed and summarized
Audit Trail
Every KYC action is immutably logged:
- Timestamp (UTC + local timezone)
- User identity (Firebase Auth UID)
- Action type (screen, report, override, alert acknowledged)
- Input parameters and output results
- Retention: 10 years (configurable per jurisdictional requirement)
Use Cases
Know Your Client. Without the Guesswork.
From instant sanctions checks to comprehensive Enhanced Due Diligence — Legalica's KYC engine gives compliance teams the speed of automation with the rigor of regulation.
Screening data processed under Zero-Data Retention. Results encrypted in transit and at rest. EU-resident data storage.
Related Platform Components
- Pull entity data directly from the Legal Identity Hub
- Reports auto-attach to your Matter Dashboard
- All screening data stored under our Zero-Data Retention policy
- Read our AI Ethics Policy on automated decision-making
- Compare with Document Drafting for KYC report templates
Legalica's KYC & Compliance Engine provides compliance information and risk screening, not legal advice. Always consult a qualified attorney or compliance professional licensed in the relevant jurisdiction before making decisions. Laws vary by jurisdiction and are subject to change. Screening results should be verified against primary sources and official registries.