Fraud Prevention, KYC and AML Compliance for P2P and Cryptoasset Exchange Operations Training Course

P2P Exchange Operations and the Fraud Risk Landscape

• The escrow-based order lifecycle and asset release mechanisms.
• Identifying exposure points: off-platform fiat versus on-platform crypto.
• Consequences of fraud loss, including chargebacks and bank claims.

Exercise 1, Mapping the Exposure: Teams will trace a buy order and a sell order from placement to release, identifying every point where off-platform payment disrupts the link between identity and funds.

Regulatory Framework and Supervisory Expectations

• FATF Recommendations, VASP obligations, and the travel rule.
• Cryptoasset supervisory authorities and exchange licensing requirements.
• Managing jurisdictional risks, grey-list monitoring, and sanctions exposure.

Fraud Typologies in P2P Trading

• Payment channel deviations and mismatched payer accounts.
• Triangulation, third-party payers, and the reuse of payment proofs.
• Partial payments, altered amounts, and visually similar figures.

Case Study, Five Recurring Patterns: Participants will analyze real anonymized dispute records against five common typologies to identify the specific control failures in each instance.

False Confirmations, Forged Receipts and Account Takeover

• Marking orders as paid without an actual transfer occurring.
• Edited screenshots and falsified bank receipts.
• Cross-phishing tactics in order chats and credential theft.
• Compromised accounts being reused to defraud other users.

Workshop, Phishing in the Order Chat: Teams will distinguish between genuine support messages and fraudulent ones, then draft the takedown and revalidation path for affected accounts.

KYC for Individuals: Level 1 and Level 2

• Level 1 data capture and identity document verification.
• Level 2 revalidation, including video-selfie liveness checks and list screening.
• Aligning verified identities with payment instruments.

Lab, Onboarding Under Pressure: Participants will conduct Level 1 and Level 2 reviews on sample files, documenting discrepancies that trigger revalidation.

KYC for Legal Entities and Beneficial Ownership

• Reviewing corporate documents, representation powers, and signatories.
• Mapping beneficial ownership chains and control indicators.
• Assessing legal person risk factors and conducting periodic reviews.

Identity Fraud and Document Forensics

• Identifying forged, borrowed, and synthetic identities.
• Detecting liveness bypasses, deepfake attempts, and injection attacks.
• Triggering revalidation following disputes or compromise claims.

Lab, Document Forensics: Participants will examine tampered documents and screen captures for inconsistencies in fonts, layout, metadata, and account numbers.

AML Screening, Sanctions and PEP

• List matching, tolerance levels, and managing false positives.
• Identifying PEPs, adverse media, and verifying source of wealth.
• Applying enhanced due diligence and setting escalation thresholds.

Customer Risk Assessment and the Risk-Based Approach

• Evaluating customer, product, channel, geography, and behavioral factors.
• Assigning risk ratings, defining review triggers, and making treatment decisions.
• Calibrating due diligence efforts to the actual risk profile.

Transaction Monitoring and Blockchain Analytics

• Withdrawal approvals based on account age, KYC status, and history.
• Wallet attribution, high-risk counterparties, and fund tracing.
• Identifying chargeback-prone gateways and payment method risks.

Case Study, The Large Withdrawal: Participants will review a withdrawal request with a mixed funding history, deciding whether to approve or escalate, and justifying the decision against monitoring criteria.

Evidence Standards for Payment Proof

• Defining acceptable evidence: statements and uninterrupted recordings.
• Conducting authenticity checks on documents, captures, and metadata.
• Recording details of what was verified and what remained unverified.

Lab, Evidence or Artifact: Teams will categorize submissions as acceptable evidence, insufficient evidence, or probable fabrication, and determine what additional information to request.

Disputed Evidence and Interbank Delays

• Resolving cases where both parties submit valid evidence.
• Managing waiting periods for interbank processing and preventive holds.
• Applying documented decision criteria for time-expired orders.

Workshop, Both Sides Are Right: Teams will resolve a dispute where both buyer and seller hold apparently genuine proof, and defend the final outcome.

Action and Sanctions Playbook

• Freezing collateral, restricting accounts, and issuing suspensions.
• Handling partial payment deadlines and returns to originating accounts.
• Managing refunds to incorrect banks, including fees and resolution timeframes.
• Restricting balances and retaining new deposits.

Exercise, Write the Sanction: Participants will draft the action, notice, and timeframe for three escalating cases, testing them against playbook criteria.

Case Management, Documentation and Escalation

• Maintaining case files, internal notes, and evidence retention.
• Using the escalation matrix and department head reviews.
• Filing suspicious activity reports and maintaining records.

Capstone: End-to-End Fraud Case

• Conducting order review, evidence assessment, and identity revalidation.
• Managing escalation, sanctions decisions, and counterparty resolution.
• Preparing justification memos and undergoing peer review.

Capstone, Full Case Run: Each team will handle a complete simulated case from the initial suspicious message to the final decision, presenting a written justification for peer review.

Diagnostic and Advisory Session (Additional Component)

• Reviewing current practices and identifying protocol gaps.
• Providing guidance on evidence standards and handling disputed cases.
• Offering guidance on action and sanctions criteria.