Counterparty clearance

Clearance is the record that a counterparty has been through customer due diligence: who verified them, on what date, against which documents, and when that verification runs out.

A counterparty has one clearance, not one per role. The verdict means “verified to the depth this counterparty’s roles require”.

You work with it on the Clearance panel of the counterparty screen.

What the verdict means

stateDiagram-v2
    [*] --> NotStarted: Clearance opened
    NotStarted --> Pending: Submit for verification
    Pending --> Verified: Verify
    Pending --> Refused: Refuse
    Verified --> Expired: Re-verification date reached
    Refused --> Pending: Submit again
    Expired --> Pending: Submit again

Freezing is separate from all of this. See Freezing a counterparty.

Getting a counterparty cleared

1. Open the counterparty and select the Clearance panel.
2. Select Submit for verification. The verdict becomes Pending.
3. A compliance officer selects Verify, chooses a Risk band, and records the evidence they relied on — its kind and a reference to the filed document.
4. The panel shows the verifying officer, the verification date, and the date the clearance expires.

Verification needs at least one piece of evidence. Recording none is refused.

If the counterparty’s type has no clearance rules configured, the panel says so and there is nothing to submit — clearance does not apply to them.

Verifying, refusing, freezing and unfreezing are all eligible for countersign, so a second pair of eyes can be required on any of them.

What clearance blocks

Account activation. An account activates only when every owning party is verified. On a joint account that means each holder: due diligence is per legal person, and the refusal names the holder who is not cleared.

The gate fails closed. If a clearance is missing while clearance rules apply to that counterparty type, activation is refused rather than allowed through.

Clearance does not block anything else. An already-active account keeps running, whatever the verdict.

Freezing a counterparty

A freeze stops outbound money and nothing else. Use it for a screening hit or a direction from the regulator.

Inflows deliberately continue. An investigation must not tip off its subject by visibly stopping their money coming in.

A freeze leaves the verdict alone: a Verified counterparty stays Verified while frozen, and unfreezing restores exactly what was there before. Freezing and unfreezing are both deliberate human acts — nothing freezes a counterparty automatically.

Freezing is not suspension. Suspending a counterparty refuses every operation; freezing refuses outbound money only.

Expiry

Each verification carries a re-verification date, set from the risk band recorded at the time. At end of day, any clearance that has reached its date becomes Expired, and a follow-up task is raised against the counterparty.

Expiry blocks new account activation. It does not stop money on existing accounts — a missed re-verification date must not kill a customer’s debit orders overnight. If money must stop, freeze the counterparty.

Worked example

Alex opens a savings account with Woodgrove Bank. Woodgrove re-verifies High-risk customers every 365 days and Low-risk customers every 1,095 days.

1. A clerk submits Alex’s clearance. The verdict is Pending.
2. On 1 March 2026 a compliance officer verifies it at the High risk band, recording an identity document and a proof of address.
3. The verdict is Verified and the clearance expires on 1 March 2027 — 365 days from the verification date.
4. Alex’s account activates. A second account for Alex and Sam jointly stays blocked until Sam is verified too.
5. On 1 March 2027 the end-of-day run marks the clearance Expired and raises a re-verification task. Alex’s existing accounts carry on unaffected; a new one cannot be activated until the clearance is verified again.

What your organisation configures

You work with all of it under Settings, in the Compliance section. It carries four screens, and they read in the order you set them up:

Set the regime up first. The requirement and threshold screens each ask which regime a rule belongs to, and a rule naming one your organisation has not set up is refused.

Everything below is a setting. Onboarding under a different set of rules is configuration rather than a release.

The regime your organisation operates under

Your organisation names the anti-money-laundering regime it operates under, and every clearance rule and reporting threshold hangs off it. The name appears on the Clearance panel, so a compliance officer can see which rules a verdict was reached under.

You can change its description, and you can switch it off. You cannot rename it — clearances and threshold reports already filed record the regime they were raised under, and renaming it would leave those records naming something that no longer exists.

Switching the regime off turns the whole clearance requirement off with it: no counterparty type demands clearance, and no account activation is gated. Switch it back on and every rule you configured is still there.

One regime at a time. Your organisation operates under a single regime, and adding a second is refused. Choosing between regimes — which customer falls under which — is not yet something you can configure, so allowing two would silently apply the wrong rules to somebody.

Which counterparty types need clearance, and what they must produce

You add a rule per counterparty type, naming the document kinds that type must produce and any data they must declare. A type with no rule has no clearance and no activation gate.

You can add a second rule for the same type in a particular role — an investor, say — and it adds to the type’s requirements rather than replacing them. The two are separate rules: removing the role’s rule leaves the type’s rule alone.

The re-verification cadence per risk band

How long a Low, Standard or High verification stays in date. Cadence is set per risk band and applies whatever the regime, so these rules do not name one.

Reportable movement thresholds

You configure the cash movements that must be reported, as one or more threshold rules. Each rule carries a name, the transaction types it adds up, an amount, and the period it adds them up over.

The name is how you tell two rules apart, so give each one something readable:

At end of day, any counterparty whose movements of the named types reach the amount gets a report raised against them, and the report records which rule produced it.

You pick the transaction types from the ones your organisation has declared, so a rule cannot name a movement type that does not exist — a rule that named one would simply never fire.