SOURCE-OF-WEALTH VERIFICATION REPORT
[SUBJECT FULL NAME - ENGAGEMENT / KYC REF]
The Source-of-Wealth Verification Report tests whether a named individual’s wealth has a legitimate, lawful, and documented origin sufficient to support a client’s onboarding, KYC/CDD, or enhanced-due-diligence decision. It takes the subject’s stated wealth narrative, reconstructs the wealth-generating events and streams behind it (business ownership/exits, compensation, inheritance, investments, real estate, professional earnings), corroborates each against documentary evidence, screens the subject and linked structures for sanctions/PEP/illicit-origin concerns, and renders a substantiation determination feeding the client’s AML/KYC decision. It is a compliance-driven verification of a (semi-)cooperative subject’s wealth narrative, conducted under the applicable AML regime - not an adversarial forensic reconstruction. It does not perform the investigative, often non-cooperative, asset-tracing and reconstruction of the Source-of-Wealth Report in the Financial Intelligence & Asset Tracing node, the valuation focus of a Wealth Profile, hidden-asset discovery (Hidden Asset Investigation), or judgment-recovery tracing. Where the narrative fails to substantiate, evidence is withheld, or assets must be forensically located, escalate to the Asset Tracing node and raise it as an RFI in §15 - do not attempt it here.
Document Control
| Field | Value |
|---|---|
| Report Reference | [REF-YYYY-###] |
| Date of Report | [YYYY-MM-DD] |
| Reporting Period / As-Of Date | [YYYY-MM-DD] |
| Classification / Handling | [CONFIDENTIAL - CLIENT / COMPLIANCE EYES ONLY / TLP:AMBER] |
| Client | [CLIENT - bank / fund / family office / gatekeeper] |
| Requesting Party | [COMPLIANCE / MLRO / RELATIONSHIP-MANAGER CONTACT - ENGAGEMENT REF] |
| Subject | [SUBJECT FULL LEGAL NAME] |
| Purpose / Trigger | [Onboarding / Periodic review / EDD on PEP / Investment admission / Transaction] |
| Cooperation Basis | [Subject-provided documentation / Independently developed / Mixed - see §3] |
| Prepared By | [ANALYST NAME / ID] |
| Reviewed By | [REVIEWER NAME / ID] |
| Approving Officer | [APPROVER NAME / ID] |
| Version | [1.0] |
| Distribution | [NAMED RECIPIENTS] |
Handling & Legal Caveat
Handling: [Classification/TLP]. Disseminate only to the named authorized recipients (typically client compliance / MLRO / legal). Reproduction or onward sharing prohibited without originator approval. Contains sensitive personal and financial data - store and transmit per the client data-processing agreement.
Nature of this product (READ FIRST): This is an AML/KYC source-of-wealth verification prepared to support the client’s customer-due-diligence and onboarding obligations. It is not a consumer report and is not prepared for any FCRA permissible purpose (employment/credit/insurance). It is not an audit opinion, a tax determination, a legal opinion, or a Suspicious Activity Report; it is one analytic input to the client’s risk decision.
Regulatory framing: Verification supports the client’s obligations under applicable AML/CTF and CDD/EDD regimes - e.g., US BSA/AML and FinCEN CDD rule, EU AMLD (4/5/6), UK MLR 2017, and FATF standards - including enhanced measures for PEPs and high-risk relationships. The governing regime set and the required evidentiary standard must be confirmed with the client’s MLRO/counsel per engagement.
Tipping-off / confidentiality: Handle to avoid prejudicing any client regulatory filing. Where collection touches the subject or third parties, conduct it so as not to “tip off” a subject who may be the focus of a confidential SAR/suspicion; any SAR decision rests with the client, not [FIRM].
Source-of-wealth vs. source-of-funds: Source of wealth (SoW) = the origin of the subject’s total accumulated wealth; source of funds (SoF) = the origin of the specific funds used in this relationship/transaction. Both are addressed (§5, §6) and must not be conflated.
Sourcing & verification: Subject-provided documents are treated as claims pending independent corroboration and graded accordingly (Annex A); a document’s existence is not proof of the underlying narrative. Findings are point-in-time and time-sensitive - re-verify before any consequential action.
Data protection: Processed under [legal basis]; where the subject/records are in the EU/UK, handled per GDPR/UK GDPR (incl. special-category limits) and retained per [RETENTION REF]. Not legal advice - evidentiary thresholds and onward use to be confirmed with client counsel.
Subject Snapshot
| Field | Value |
|---|---|
| Full Legal Name | [Name] |
| Also Known As (AKA) | [Prior names / transliterations] |
| Nationality / Residence / Tax Domicile | [ ] |
| Identity Resolution Confidence | [Confirmed / Probable / Possible / Unresolved] |
| PEP Status | [Not PEP / Domestic / Foreign / Int’l-org / Close associate or family - see §7] |
| Claimed Principal Source(s) of Wealth | [e.g., business sale, inheritance, compensation - see §4] |
| Estimated Wealth Order of Magnitude | [Range - for context, not a valuation; defer to Wealth Profile] |
| Sanctions / Watchlist Status | [No match / Potential / Confirmed - see §7] |
| Material Red Flags | [Count by severity: Crit / High / Med / Low] |
| Source-of-Wealth Determination | [SUBSTANTIATED / PARTIALLY SUBSTANTIATED / UNSUBSTANTIATED / ADVERSE - illicit-origin concern - see §3] |
Table of Contents
- BLUF
- Executive Summary
- Source-of-Wealth Determination & KYC Recommendation
- Priority Intelligence Requirements (PIRs)
- Wealth Narrative as Claimed
- Source-of-Wealth Reconstruction & Corroboration
- Source-of-Funds (Transaction / Relationship)
- Subject Identity, PEP, Sanctions & Watchlist Screening
- Associated Entities, Trusts & Beneficial Interests
- Adverse Media & Illicit-Origin Indicators
- Litigation, Regulatory & Tax-Integrity History
- Geographic & Jurisdictional Risk
- Wealth-Narrative Reconciliation & Verified Findings
- Red Flags & Illicit-Origin Indicators
- Key Assumptions, Collection Gaps & RFIs
- Source-of-Wealth Risk Matrix & Recommendations
- Annex A - Sources & Methodology
- Annex B - Appendices
(Page numbers populate on export to Word/PDF.)
1. BLUF
2–3 sentences. Lead with the source-of-wealth determination and the single most decision-relevant fact (e.g., the principal wealth source is substantiated by primary documentation; or a material portion is unsubstantiated; or an illicit-origin/sanctions concern exists), then the residual wealth-legitimacy risk and the required next action. Written so the MLRO/decision-maker can act on this line alone.
[BLUF]
2. Executive Summary
Triggering requirement and purpose (onboarding / periodic review / PEP EDD / investment admission / transaction). Who the subject is and the claimed wealth narrative in brief. Scope in/out - what was verifiable vs. deferred to the Asset Tracing node. Narrative of key findings across the wealth streams, to the ICD 203 floor - reporting separated from analytic judgment, uncertainty drivers and the cooperation basis named.
[EXECUTIVE SUMMARY]
3. Source-of-Wealth Determination & KYC Recommendation
The adjudication core. State the cooperation basis (how much rests on subject-provided vs. independently developed evidence - this caps achievable confidence), the determination, and the recommendation. The determination flows from the §13 reconciliation and §16 matrix.
3.1 Determination
| Determination | Meaning |
|---|---|
| SUBSTANTIATED | The material wealth streams are corroborated by independent/primary evidence; narrative is consistent and plausible; no illicit-origin indicators. |
| PARTIALLY SUBSTANTIATED | Principal source(s) corroborated but material gaps remain (a stream, time period, or proportion unevidenced); residual risk to be managed by conditions/EDD. |
| UNSUBSTANTIATED | The narrative cannot be corroborated to the required standard - documentation absent, inconsistent, or unverifiable; not a finding of wrongdoing, but the standard is not met. |
| ADVERSE - illicit-origin concern | Evidence indicates a portion of wealth derives from, or is materially linked to, unlawful conduct, sanctions exposure, or undisclosed prohibited sources. |
3.2 KYC / Onboarding Recommendation
Recommendation: [PROCEED / PROCEED WITH EDD CONDITIONS / ESCALATE TO FORENSIC ASSET TRACING / DECLINE] - Determination: [above]; residual wealth-legitimacy risk [n/25, band]; cooperation basis [subject-provided / developed / mixed]. [One-line rationale tied to §13/§16 and the governing concern.]
4. Priority Intelligence Requirements (PIRs)
Collection-management spine, tailored to source-of-wealth. State each PIR, answer, key evidence, and analytic confidence (separate from likelihood). Summarize in the matrix.
- PIR-1 - Origin: What are the material sources of the subject’s accumulated wealth, and are they lawful and documented? [Answer / evidence / confidence]
- PIR-2 - Corroboration: Does independent evidence corroborate the claimed narrative, in substance and proportion? [ ]
- PIR-3 - Funds: Where do the specific funds entering this relationship/transaction originate (SoF)? [ ]
- PIR-4 - Concern: Is there any sanctions, PEP-corruption, fraud, tax-evasion, or other illicit-origin nexus? [ ]
- PIR-5 - Structure: Through what entities/trusts/jurisdictions is the wealth held, and do they obscure origin or control? [ ]
- [Add engagement-specific PIRs.]
| PIR | Answer (summary) | Confidence | Key Gap |
|---|---|---|---|
| PIR-1 | [ ] | [H/M/L] | [ ] |
| PIR-2 | [ ] | [H/M/L] | [ ] |
| PIR-3 | [ ] | [H/M/L] | [ ] |
| PIR-4 | [ ] | [H/M/L] | [ ] |
| PIR-5 | [ ] | [H/M/L] | [ ] |
5. Wealth Narrative as Claimed
Set out the subject’s (or intermediary’s) stated origin-of-wealth narrative as provided - the claim to be tested - without yet endorsing it. Capture each asserted source, the approximate magnitude and timeframe attributed to it, and the documents offered in support. This section is descriptive; corroboration is §6. Note who provided it and in what form (questionnaire, RM notes, declaration).
| Claimed source | Asserted magnitude / period | Supporting docs offered | Provided by |
|---|---|---|---|
| [e.g., sale of [Company] (20XX)] | [ ] | [SPA / bank record / tax filing] | [ ] |
6. Source-of-Wealth Reconstruction & Corroboration
The analytic heart. For each material wealth stream, reconstruct the wealth-generating event/activity and corroborate it against independent or primary evidence - testing both that it occurred and that it plausibly accounts for the attributed magnitude. Treat subject-provided documents as claims pending corroboration; weight primary/independent sources highest. Where a stream cannot be corroborated to standard, say so explicitly.
| Wealth stream | Reconstruction (what generated it) | Corroborating evidence & grade | Accounts for magnitude? | Substantiation |
|---|---|---|---|---|
| Business ownership / exits | [Founding, role, equity, sale price, buyer, escrow] | [ ] | [Y / Partial / N] | [Substantiated / Partial / Unsubstantiated] |
| Employment / executive compensation | [Roles, comp history, equity awards] | [ ] | [ ] | [ ] |
| Inheritance / family wealth / gifts | [Decedent/donor, estate, transfer evidence] | [ ] | [ ] | [ ] |
| Investments / capital markets | [Portfolio gains, dividends, fund interests] | [ ] | [ ] | [ ] |
| Real estate | [Acquisitions/disposals, gains] | [ ] | [ ] | [ ] |
| Professional practice / other earnings | [ ] | [ ] | [ ] | [ ] |
Plausibility note: [Does the corroborated origin plausibly account for the subject’s overall apparent wealth, or is there an unexplained gap? An unexplained gap is a §14 red flag.]
7. Source-of-Funds (Transaction / Relationship)
Distinct from §6. Trace the specific funds entering this relationship/transaction: originating account/institution, jurisdiction, payment route, and the link from those funds back to a substantiated wealth stream. Flag third-party funding, opaque routing, or funds whose path cannot be tied to a legitimate source.
| Funds / tranche | Originating account / institution / jurisdiction | Route | Linked to which §6 stream | Concern |
|---|---|---|---|---|
| [ ] | [ ] | [ ] | [ ] | [ ] |
8. Subject Identity, PEP, Sanctions & Watchlist Screening
Resolve the subject’s identity (matched identifiers, residence, tax domicile, nationality). Establish PEP status and any close-associate/family PEP linkage - central to the EDD weighting and the corruption-origin hypothesis. Screen the subject and linked persons/entities against sanctions/export/watchlists; every hit is a potential match pending confirmation, dispositioned with discriminating identifiers.
| Subject screened | PEP status | Lists / regimes (version date) | Result | Disposition & identifiers |
|---|---|---|---|---|
| [Subject] | [ ] | [OFAC/OFSI/EU/UN; PEP datasets] | [No / Potential / Confirmed] | [ ] |
9. Associated Entities, Trusts & Beneficial Interests
Map the entities, holding companies, trusts, foundations, and structures through which the subject holds or controls wealth. Layered/cross-border or secrecy-jurisdiction structures, nominee arrangements, and opacity that frustrates tracing origin are themselves risk findings. Identify control exercised by means other than direct ownership. Link any structure to a sanctioned/PEP party or to an unexplained wealth gap.
| Entity / structure | Jurisdiction | Subject’s interest / control | Role re: wealth | Opacity / flag |
|---|---|---|---|---|
| [ ] | [ ] | [ ] | [Holding / operating / nominee] | [ ] |
10. Adverse Media & Illicit-Origin Indicators
Structured adverse-media screen (subject + associated entities) focused on illicit-origin themes: corruption, fraud, embezzlement, organized crime, sanctions evasion, tax evasion, market abuse, predicate offenses. Grade reliability; separate substantiated reporting from allegation/rumor; note language and jurisdiction coverage limits. A substantiated predicate-offense link is a §3 “ADVERSE” driver.
| Theme | Summary | Substantiation | Source Grade |
|---|---|---|---|
| [ ] | [ ] | [Substantiated / Reported / Rumor] | [ ] |
11. Litigation, Regulatory & Tax-Integrity History
Material litigation, regulatory/enforcement actions, insolvency, and tax disputes bearing on the lawful origin and integrity of the wealth (fraud judgments, disgorgement, unexplained-wealth/asset-forfeiture orders, tax-evasion findings). Distinguish allegations from adjudicated outcomes; state forum, status, and materiality to the determination.
| Matter | Forum / Date | Status | Materiality to SoW | Grade |
|---|---|---|---|---|
| [ ] | [ ] | [ ] | [ ] | [ ] |
12. Geographic & Jurisdictional Risk
Assess the jurisdictions where the wealth was generated and where it is held against corruption (CPI), financial-secrecy, sanctions, and high-risk/AML-deficient (FATF grey/black-list) ratings. Wealth generated in or routed through high-risk or secrecy jurisdictions raises the evidentiary bar and the residual-risk weighting.
| Jurisdiction | Role (origin / holding / routing) | Risk rating basis | Weighting |
|---|---|---|---|
| [ ] | [ ] | [CPI / FATF / secrecy / sanctions] | [L/M/H] |
13. Wealth-Narrative Reconciliation & Verified Findings
The core close-out artifact: reconcile the claimed narrative (§5) against the corroborated reconstruction (§6–§7), stream by stream, and state the overall substantiation. Equivalent in role to the discrepancy analysis in the screening products - it is where claim meets evidence.
| Claimed source (§5) | Corroborated? | Evidence basis & grade | Variance / gap | Status |
|---|---|---|---|---|
| [ ] | [Yes / Partial / No] | [ ] | [ ] | [Verified / Unverified / Contradicted] |
Overall substantiation: [Proportion of apparent wealth substantiated; the material unexplained portion, if any; net determination feeding §3.]
14. Red Flags & Illicit-Origin Indicators
| # | Red Flag | Dimension (§) | Severity | Basis | Disposition |
|---|---|---|---|---|---|
| 1 | [ ] | [ ] | [Crit/High/Med/Low] | [ ] | [Open / Mitigable / Disqualifying] |
Severity: Critical - substantiated illicit origin, sanctions nexus, or undisclosed prohibited source. High - material unexplained wealth, opaque structures defeating tracing, or PEP-corruption indicators unresolved. Medium - manageable gap requiring EDD/conditions. Low - note only.
15. Key Assumptions, Collection Gaps & RFIs
Light Key Assumptions Check (assumptions that, if wrong, change the determination - e.g., subject-provided documents are authentic; the disclosed structure is the complete one; the attributed sale price is accurate). Collection gaps and RFIs - including where documentation was withheld, untranslatable, or originates in a closed jurisdiction, and the impact on the determination. Items requiring forensic tracing route to the Asset Tracing node.
| Assumption / Gap | Basis / Why open | Impact if wrong / unresolved | Recommended collection | Priority |
|---|---|---|---|---|
| [ ] | [ ] | [ ] | [ ] | [H/M/L] |
16. Source-of-Wealth Risk Matrix & Recommendations
16.1 Risk Matrix
Residual wealth-legitimacy risk = Illicit-origin likelihood (1–5) × Materiality/Exposure (1–5) = 1–25. State the governing dimension. This score drives the §3 recommendation.
| Illicit-origin likelihood (1–5) | Materiality / exposure (1–5) | Residual score (1–25) | Band | Governing dimension |
|---|---|---|---|---|
| [ ] | [ ] | [ ] | [Low 1–5 / Mod 6–10 / Elevated 11–15 / High 16–20 / Critical 21–25] | [ ] |
16.2 Recommendations
- KYC / onboarding decision: [PROCEED / PROCEED WITH EDD CONDITIONS / ESCALATE / DECLINE].
- EDD conditions / controls: [e.g., obtain primary documentation for the unevidenced stream; certified source-of-funds confirmation; restrict transaction scope; senior-management/MLRO sign-off; enhanced ongoing monitoring.]
- Escalations / RFIs: [Forensic reconstruction or hidden-asset hunting → Asset Tracing node; valuation → Wealth Profile.]
- Re-verification cadence: [Periodic-review interval and trigger events - material new funds, ownership/structure change, adverse media, PEP-status change. Route ongoing watch to Continuous Re-Vetting & Insider-Threat Monitoring.]
17. Annex A - Sources & Methodology
Collection methods and scope; the source register graded with the Admiralty two-axis code; the reference scales (below); statement of the likelihood-vs-confidence separation; the cooperation basis and its effect on achievable confidence; coverage/currency limitations by jurisdiction.
Source reliability (Admiralty, A–F): A Completely reliable · B Usually reliable · C Fairly reliable · D Not usually reliable · E Unreliable · F Reliability cannot be judged.
Information credibility (Admiralty, 1–6): 1 Confirmed by other sources · 2 Probably true · 3 Possibly true · 4 Doubtful · 5 Improbable · 6 Truth cannot be judged. (Each sourced datum carries a two-character grade, e.g., B2. Subject-provided documents are graded for independence, not assumed primary.)
Estimative probability / likelihood (ICD 203): almost no chance / remote (01–05%) · very unlikely (05–20%) · unlikely (20–45%) · roughly even chance (45–55%) · likely (55–80%) · very likely (80–95%) · almost certain (95–99%).
Analytic confidence (evidence base - kept separate from likelihood): HIGH (multiple independent reliable sources, primary documentation, no significant contradiction) · MODERATE (some corroboration, gaps, minor unresolved inconsistency) · LOW (single/uncorroborated or subject-provided-only source, significant gaps, plausible alternatives open). Never combine a likelihood term and a confidence level in the same sentence.
Wealth-legitimacy risk scoring: Illicit-origin likelihood (1–5) × Materiality/exposure (1–5) = 1–25; key: 1–5 Low · 6–10 Moderate · 11–15 Elevated · 16–20 High · 21–25 Critical.
Identity-resolution confidence: Confirmed / Probable / Possible / Unresolved - matched identifiers stated; disambiguation explicit.
Substantiation scale (source-of-wealth specific): Substantiated (corroborated by independent/primary evidence in substance and proportion) · Partially substantiated (corroborated in part; material gap) · Unsubstantiated (not corroborable to the required standard) · Adverse (evidence of illicit origin).
18. Annex B - Appendices
- Appendix A - Subject & Identifier Index: names/AKAs, DOB, nationality, residence, tax domicile, matched identifiers.
- Appendix B - Wealth-Source Register: each stream, attributed magnitude/period, corroborating evidence and grade.
- Appendix C - Document Schedule: every document relied on, provenance (subject-provided vs. independently obtained), authentication status.
- Appendix D - Entity / Ownership & Trust Chart: structure diagram pointer.
- Appendix E - Screening-Hit Log: lists screened, versions/dates, hits and dispositions.
- Appendix F - Full Source Register: every source, Admiralty grade, access date, reference.
- Appendix G - Glossary & Abbreviations.
- Appendix H - Revision History.
END OF REPORT.
Verification disclaimer: This source-of-wealth verification is a point-in-time assessment based on open, licensed, and subject-provided sources current as of the as-of date; it is not an audit, a tax determination, a legal opinion, or a Suspicious Activity Report. Subject-provided documentation is corroborated where possible but cannot be independently guaranteed. Determinations are time-sensitive - re-verify before any consequential onboarding, funding, or transaction decision.
Document control footer: [REF-YYYY-### · Version · Classification/TLP · Prepared/Reviewed/Approved · Distribution].
Model wiring
Generated from cell frontmatter at publish time.