Verification Process
CapSign's verification process ensures comprehensive compliance while protecting user privacy through our minimal disclosure attestation framework. This guide outlines the complete verification workflow and document requirements for both individuals and legal entities.
Overview
Verification Principles
Risk-Based Verification - Verification depth matches compliance level requirements
Privacy Protection - Sensitive data encrypted and stored off-chain
Regulatory Compliance - Meets KYC/AML requirements across jurisdictions
User Experience - Streamlined process with clear requirements
Verification Levels
Basic Compliance - Identity verification and sanctions screening
Enhanced Compliance - Financial qualification and detailed background checks
Institutional Compliance - Entity verification and professional due diligence
Individual Verification Process
Required Documents
Primary Identity Document (Required)
Acceptable Documents:
Passport - Preferred for international users
National ID Card - Government-issued photo ID
Driver's License - Valid government-issued license
Requirements:
Must be government-issued with photo
Must be current (not expired)
Must be clearly readable (all text and images visible)
Document number, issuing authority, and expiration date must be visible
Address Verification Document (Required)
Acceptable Documents:
Utility Bill - Gas, electric, water, internet, cable (within 90 days)
Bank Statement - Official bank or credit card statement (within 90 days)
Lease Agreement - Current residential lease with signature
Government Notice - Tax notice, voter registration, or official correspondence
Requirements:
Must show current residential address
Must be dated within 90 days (except lease agreements)
Name on document must match identity document
Address must be complete (no P.O. boxes for primary residence)
Financial Documentation (Enhanced/Institutional Levels)
For Accredited Investor Verification:
Income-Based Qualification:
Tax Returns - Last 2 years of filed tax returns (Form 1040)
W-2 Forms - Last 2 years of employment income verification
Pay Stubs - Recent pay stubs covering 3-month period
CPA Letter - Certified statement of income for current year
Net Worth-Based Qualification:
Bank Statements - Last 3 months for all accounts
Investment Statements - Brokerage, retirement, investment accounts
Property Appraisals - Real estate valuations (excluding primary residence)
Debt Statements - Outstanding loans, mortgages, credit lines
Professional Certification (Alternative Qualification):
Professional Licenses - Investment advisor, broker-dealer, lawyer, doctor
Employment Verification - Letter from qualified institution
Board Memberships - Corporate board or investment committee roles
Verification Methods
Document Verification Process
Automated OCR Scanning - Extract text and verify document structure
Visual Inspection - Manual review for authenticity markers
Database Verification - Cross-check against government databases (where available)
Liveness Detection - Real-time photo capture for identity matching
Biometric Verification (Optional Enhanced)
Face Matching - Compare live photo with identity document
Liveness Check - Verify user is physically present during verification
Document Authenticity - Check security features and tamper evidence
Verification Score - Confidence rating (0-100) for verification quality
Video Call Verification (High-Value Transactions)
Live Identity Verification - Real-time document verification with compliance officer
Enhanced Due Diligence - Additional screening for high-risk profiles
Document Authentication - Physical examination of original documents
Source of Funds Interview - Discussion of wealth source and investment objectives
Compliance Screening
Sanctions Screening (Required)
Screening Lists:
OFAC SDN List - US Treasury Specially Designated Nationals
EU Sanctions - European Union consolidated sanctions list
UN Sanctions - United Nations Security Council sanctions
National Lists - Country-specific sanctions and watchlists
Enhanced Screening (Risk-Based)
PEP Screening - Politically Exposed Persons identification
Government officials and their families
Political party officials
Heads of state-owned enterprises
International organization leaders
Adverse Media Screening - Negative news and criminal background
Financial crimes and regulatory violations
Criminal convictions and investigations
Bankruptcy and civil judgments
Reputation and conduct issues
Risk Assessment
Risk Factors Evaluated:
Geographic risk (country of residence and citizenship)
Industry risk (occupation and business activities)
Transaction risk (investment amounts and frequency)
Relationship risk (beneficial ownership and control structures)
Risk Scoring (0-100 scale):
Low Risk (0-25) - Standard verification and monitoring
Medium Risk (26-60) - Enhanced due diligence required
High Risk (61-100) - Senior management approval and ongoing monitoring
Legal Entity Verification Process
Required Documents
Corporate Identity Documents (Required)
For Corporations:
Certificate of Incorporation - State filing showing entity formation
Articles of Incorporation - Corporate charter and bylaws
Good Standing Certificate - Current state certificate (within 90 days)
Corporate Resolution - Board authorization for investment activities
For LLCs:
Articles of Organization - State filing showing LLC formation
Operating Agreement - LLC governance and member agreements
Certificate of Good Standing - Current state certificate
Member Resolution - Authorization for investment decisions
For Partnerships:
Partnership Agreement - General or limited partnership documents
Certificate of Limited Partnership - State filing (if applicable)
Partnership Resolution - Authorization for investment activities
For Trusts:
Trust Agreement - Complete trust document with amendments
Trustee Certification - Current trustee appointment documentation
Beneficiary Information - Beneficial ownership details
Tax ID Documentation - EIN assignment letter
Beneficial Ownership Documentation (Required)
25% or Greater Ownership:
Ownership Structure Chart - Visual representation of ownership
Shareholder/Member Lists - Current ownership percentages
Individual Verification - KYC for each 25%+ beneficial owner
Control Person Identification - CEO, CFO, and controlling parties
Financial Documentation (Enhanced/Institutional)
Financial Statements:
Audited Financials - Last 2 years (preferred for institutional)
Tax Returns - Entity tax filings for last 2 years
Bank Statements - Last 3 months for operating accounts
Financial Projections - Business plan and revenue forecasts
Investment Authorization:
Investment Policy Statement - Approved investment guidelines
Authorized Signatory List - Who can make investment decisions
Investment Committee Minutes - Documentation of investment approval process
Legal Opinion - Attorney confirmation of investment authority
Entity-Specific Verification
Corporate Entities
Verification Process:
State Database Check - Verify incorporation and good standing
UCC Filings Review - Check for liens and security interests
Litigation Search - Review for pending lawsuits and judgments
Regulatory History - Check SEC, FINRA, and other regulatory filings
Due Diligence Areas:
Business operations and revenue sources
Management team background and experience
Related party transactions and conflicts of interest
Regulatory compliance and licensing requirements
Investment Funds
Additional Requirements:
Fund Documentation - Private placement memorandum, subscription agreements
Regulatory Filings - Form ADV, Form PF, or other regulatory submissions
Custodian Arrangements - Asset custody and safekeeping documentation
Independent Service Providers - Auditor, administrator, and legal counsel information
Non-US Entities
Additional Documentation:
Certificate of Good Standing - From jurisdiction of incorporation
Apostille/Authentication - For documents used in international transactions
Legal Opinion - Local counsel confirmation of entity status and authority
Translation - Certified English translation of foreign documents
Verification Timeline
Standard Processing
Individual Basic - 1-2 business days
Individual Enhanced - 3-5 business days
Entity Standard - 5-7 business days
Entity Institutional - 7-14 business days
Expedited Processing (Available)
Same Day - Additional fee applies, subject to document quality
Next Day - Guaranteed next business day completion
Priority Queue - 50% faster than standard processing
Factors Affecting Timeline
Delays May Occur Due To:
Incomplete or unclear documents
Additional screening requirements
Manual review requirements
Third-party database delays
Clarification requests
Document Quality Requirements
Technical Specifications
Image Quality:
Resolution - Minimum 300 DPI or 1200x800 pixels
Format - PDF, PNG, or JPEG formats accepted
File Size - Maximum 10MB per document
Color - Color images preferred, black and white acceptable
Content Requirements:
Complete Document - All pages included, no cropping of important information
Legible Text - All text clearly readable without magnification
Security Features - Watermarks, seals, and signatures visible
No Alterations - Original documents only, no editing or modifications
Common Document Issues
Rejected Documents:
Expired identity documents
Screenshots or photocopies of copies
Documents with missing pages or information
Unclear or blurry images
Altered or tampered documents
Tips for Success:
Use good lighting and flat surface for photos
Ensure all four corners of document are visible
Avoid shadows, glare, or reflections
Take multiple photos if document has multiple pages
Use scanner apps for best quality mobile captures
Privacy and Data Protection
Data Handling
Encryption Standards:
Data in Transit - TLS 1.3 encryption for all uploads
Data at Rest - AES-256 encryption for stored documents
Key Management - Hardware security modules for encryption keys
Access Controls - Role-based access with audit logging
Data Retention:
Active Period - During relationship and as required by regulation
Retention Period - 7 years after relationship termination (or as required by law)
Secure Deletion - Cryptographic erasure when retention period expires
User Rights
Privacy Controls:
Data Access - Complete record of what data is stored
Data Portability - Export capability in machine-readable format
Data Correction - Update process for incorrect information
Data Deletion - Subject to legal and regulatory retention requirements
Compliance Framework:
GDPR Compliance - EU data protection regulation
CCPA Compliance - California Consumer Privacy Act
SOC 2 Type II - Annual security and controls audit
ISO 27001 - Information security management system
Verification Outcomes
Attestation Creation
Successful Verification Results In:
Public Attestation - Basic compliance status (minimal disclosure)
Compliance confirmed without revealing sensitive details
Jurisdiction and sanctions status verification
Valid attestation period (typically 1 year)
Private Reference Attestation - Pointer to detailed encrypted data
Cryptographic commitment to full verification details
Access-controlled decryption for authorized parties
Complete audit trail of verification process
Verification Statuses
Verified - All requirements met, attestation issued
Pending - Under review, additional information may be requested
Conditional - Approved with specific restrictions or monitoring
Rejected - Does not meet verification requirements
Expired - Previous verification has expired, re-verification required
Appeals Process
If Verification is Rejected:
Review Notice - Detailed explanation of rejection reasons
Document Resubmission - Opportunity to provide additional or corrected documents
Manual Review - Human review of automated decision
Compliance Officer Consultation - Discussion of specific requirements
Alternative Verification - Explore alternative qualification methods
Need help with verification? Contact our compliance team at [email protected] or review our Attestation Schemas for technical implementation details.
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