Comprehensive documentation is essential for demonstrating CARF compliance. This guide covers what records to maintain and for how long.

Documentation Requirements

CASPs must maintain records of:

User Identification

  • Identity documents collected
  • Verification results
  • Entity classification documentation
  • Controlling person identification

Self-Certifications

  • Original or copy of self-certification form
  • Date of collection
  • Method of collection
  • Any subsequent updates

Validation Records

  • TIN validation results
  • Reasonableness checks performed
  • Any inconsistencies identified
  • Resolution documentation
Audit Trail

Maintain a complete audit trail showing when information was collected, validated, and updated. This is critical for regulatory examinations.

Retention Periods

Retention requirements vary by jurisdiction:

  • EU (DAC8): 5 years minimum
  • Other jurisdictions: Typically 5-7 years
  • Ongoing users: Duration of relationship plus retention period

Format Requirements

  • Readable and reproducible
  • Searchable for audit purposes
  • Secure from unauthorized access
  • Protected against alteration
  • Backed up appropriately
Data Protection

Documentation requirements must be balanced with GDPR and other data protection obligations. Implement appropriate security measures for sensitive personal data.

Audit Readiness

Prepare for regulatory inquiries:

  • Centralized document repository
  • Quick retrieval capabilities
  • Clear audit trails
  • Summary reports available

Best Practices

  • Automate document collection and storage
  • Implement version control
  • Regular compliance audits
  • Clear retention and destruction policies

Conclusion

Good documentation practices reduce regulatory risk and facilitate audit responses. Invest in systems that automate documentation collection and maintenance.

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