KYC Document Verification Requirements in Mexico

Mexico is a jurisdiction in North America that is considered to be a safe haven for money laundering and other illicit crimes. CJNG and Sinaloa Cartel are deeply entrenched and highly influential in Mexico to bypass all KYC and AML regulations and there’s an ongoing war between the law enforcement and criminals there. Financial regulators try to curb the illicit activities by introducting different regulations and regulate the circle through different procedures including the obligation of KYC Document Verification in Mexico. Let us see how Mexican authorities have laid foundations of KYC AML regulations.

Belal Mahmoud

KYC Product Consultant

KYC Regulatory Framework in Mexico

In Mexico, several regulatory bodies oversee the KYC and AML Regulations. Here’s a brief overview of Mexico’s KYC Regulatory bodies:

In Mexico, several regulatory authorities oversee and enforce KYC (Know Your Customer) regulations across various sectors, particularly in the financial industry. The main KYC regulatory authorities in Mexico include:

This infographic enlists the KYC and AML regulatory bodies of Mexico including 1) CNBV 2) SHCP 3) UIF 4) CNSF

Comisión Nacional Bancaria y de Valores (CNBV):

The National Banking and Securities Commission is the primary regulatory authority for Mexican banks, brokerage firms, and other financial institutions.
It is responsible for compliance of fintech businesses and other entities with regulations related to KYC, AML, and CTF measures.
It issues regulations, guidelines, and circulars so that the financial institutions adhere to KYC requirements and implement effective risk management strategies.

Secretaría de Hacienda y Crédito Público (SHCP):

It is also known as the Ministry of Finance and Public Credit which formulates and implements economic and financial policies in Mexico.
SHCP plays a significant role in implementing overall policies related to AML & CFT and collaborates with other government agencies in combating financial crimes.

Unidad de Inteligencia Financiera (UIF):

The Financial Intelligence Unit is a specialized and authoritative agency within SHCP responsible for receiving, analyzing, and circulating reports on suspicious activities (SARs) and Transactions (STRs) related to money laundering and terrorism financing.
UIF plays a crucial role in the enforcement of AML/CFT regulations providing actionable intelligence to law enforcement agencies and other regulatory authorities.
It collaborates with CNBV and other regulatory bodies to investigate and sanction entities that violate KYC and AML regulations.

Comisión Nacional de Seguros y Fianzas (CNSF):

The National Insurance and Bonding Commission regulates and supervises insurance companies and bonding in Mexican financial institutions.
Its main responsibility is to ensure compliance with KYC regulations within the insurance sector, ensuring that insurance companies implement adequate measures to prevent money laundering and terrorist financing activities.

KYC Regulations in Mexico

Ley Anti-lavado de Dinero (Anti-Money Laundering Law)	This law is also known as the Anti-Money Laundering Act which outlines the requirements and obligations for financial institutions and designated non-financial businesses and professions (DNFBPs) to prevent moneylaundering and terrorist financing. It establishes the framework for customer identification, due diligence, record-keeping, and reporting of suspicious transactions.
Reglamento de la Ley Anti-lavado de Dinero (Regulations of the Anti-Money Laundering Law)	This law provides further guidance and specifications on the implementation of the Anti-Money Laundering Law including specific requirements for customer identification, risk assessment, internal controls, and reporting obligations.
Ley Federal para la Prevención e Identificación de Operaciones con Recursos de Procedencia Ilícita (Federal Law for the Prevention and Identification of Operations with Illegal Resources)	This law, commonly referred to as the Money Laundering Prevention Law, supplements the Anti-Money Laundering Law and establishes additional measures for the prevention, detection, and prosecution of money laundering activities.
Reglamento de la Ley Federal para la Prevención e Identificación de Operaciones con Recursos de Procedencia Ilícita (Regulations of the Money Laundering Prevention Law)	These regulations provide detailed guidelines for the implementation of the Money Laundering Prevention Law, including provisions related to customer due diligence, risk assessment, reporting obligations, and internal controls.
Regulación del Sistema Nacional de Prevención, Identificación y Combate al Lavado de Dinero y al Financiamiento del Terrorismo (Regulation of the National System for the Prevention, Identification, and Combat of Money Laundering and the Financing of Terrorism)	This regulation establishes the procedures and requirements for the operation of the National System for the Prevention, Identification, and Combat of Money Laundering and the Financing of Terrorism, which coordinates efforts among government agencies and financial institutions to combat financial crimes.
Normatividad emitida por la Comisión Nacional Bancaria y de Valores (CNBV) (Regulations issued by the National Banking and Securities Commission):	The CNBV, as the regulatory authority for the financial sector in Mexico, issues specific regulations, guidelines, and circulars related to KYC requirements for banks, brokerage firms, and other regulated entities.

Documents Required for KYC in Mexico

KYC document verification in Mexico is almost the same as that of US. The only difference is the regulatory framework governing the KYC in both jurisdictions. Here’s a list of required documents for verification in Mexico:

Identity Verification Documents in Mexico

A Valid Passport
A Driver’s License
A National Identity Card

Important Note: Registro Federal de Contribuyentes (RFC) which is also known as Federal Taxpayer Registry and is equivalent to SSN (Social Security Number) in USA. It is issued by Servicio de Administración Tributaria (SAT)

Address Verification Documents in Mexico

A current utility bill (such as gas, electricity, telephone or mobile phone bill).
A document issued by a government department that shows a user’s present Mexican address.
A a maximum 3 month old bank statement that shows a user’s address.

Also Read: KYC Document Verification Requirements in the UAE

Verification Time

The Verification time in Mexico’s financial institutions depends on the institutions KYC procedure’s efficiency and speed. Now most institutions recognize the need of digital KYC for faster customer onboarding. Normally a couple of business days are required for KYC Document Verification in Mexico.

How KYC Solutions can help streamlining KYC Document Verification for Mexican Citizens?

The present times are the dawn of AI (Artificial Intelligence) and related technologies. Everything is becoming fully automated and digitized to facilitate human beings. Here the KYC procedures also seek ways to automate and digitize their operations to minimize human involvement and inaccuracies. Mexico is a partially regulated jurisdiction where violent crimes are increasing everyday. To extinguish the fire regulators need to cut the fuel supply which is the financing of criminal gangs. KYC document verification can play a vital role in this situation where every user’s data being recorded will make it easy to identify criminals and stop their funding. Through proper compliance measures, every onboarded genuine customer can be protected and financial crimes can be reduced to minimum.

Moreover, the KYC Solutions need to realize the importance of analyzing their current features and improve them accordingly. KYC AML Guide brings a unique and practical solution to the needs of fintech firms and the KYC Solutions which is the KYC Technology Buying Consultancy powered by our Vendor Analysis. We can guide and enable sustainable growth through cost savings while making a decision of investment in a KYC Solution. We make perfect matches between the world-class businesses and the top-notch KYC Solution providers.

Belal Mahmoud

Belal possess over 8 years experience in the KYC Identity Verification industry. He has consulted KYC solutions for over 20 new economy companies at DIFC and ADGM while ensuring a seamless technical integration and helped in jurisdictional compliance audits.