The Source of Funds Document Verification check helps verify the authenticity of business funding documents and validates the source of funds information. This guide explains how to run the check, what data to provide, and how to interpret the results.

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Check ID

kyb.source_of_funds_document_check

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Overview

The check analyzes various aspects of source of funds documents:

  • Document authenticity and validity
  • Business name verification
  • Source of funds type and description validation
  • Funding amount verification
  • Document date validation
  • Document fraud detection

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How the Check Works

  1. Document Analysis

    • Extracts key information from source of funds documents
    • Validates document structure and format
    • Verifies document authenticity
    • Identifies business name, funding source, and amount

  2. Information Verification

    • Cross-references extracted data with self-attested information
    • Validates business name matches
    • Confirms funding source is consistent with self-attested data
    • Verifies funding amounts meet minimum requirements (if applicable)
    • Checks document recency against validity period

  3. Fraud Detection (optional)

    • Analyzes documents for signs of tampering or manipulation
    • Identifies inconsistencies or suspicious elements
    • Flags potential document fraud indicators

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When to Use

Use this check when you need to:

  • Verify the legitimacy of a business’s declared funding sources
  • Validate the authenticity of funding documentation
  • Confirm funding amounts meet required thresholds
  • Ensure business name consistency across documentation
  • Detect potentially fraudulent or tampered documents

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Required Data

To run this check, you need to provide:

  1. Source of Funds Documents

    • Bank statements
    • Investment documents
    • Fundraising announcements
    • Loan agreements
    • Other financial documents demonstrating funding sources

  2. Self-Attested Information

    • Business name
    • Declared source of funds

  3. External Validation Data

    • Minimum amount to verify (optional)
      • Must be included in the external_validation_data.source_of_funds field
      • Type: SourceOfFundsExternalData
      • Example: { "minimum_amount_to_verify": { "currency": "USD", "amount": 1000 } }

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Example KYB Schema

Here’s an example of how to structure your request with the required data:

{
  "id": "business_123",
  "self_attested_data": {
    "business_name": "Example Corp",
    "source_of_funds": ["Investment", "Revenue"],
    "source_of_funds_documents": [
      {
        "url": "https://storage.example.com/funding_doc.pdf",
        "file_name": "series_a_funding.pdf",
        "source_type": "file_url",
        "description": "Series A funding documentation"
      }
    ]
  },
  "external_validation_data": {
    "source_of_funds": {
      "minimum_amount_to_verify": {
        "currency": "USD",
        "amount": 5000000.00
      }
    }
  }
}

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Valid Document Types

The following document types are supported for source of funds verification:

  1. Bank Statement

    • A document showing the financial transactions and balances of a bank account
    • Examples: Checking account statement, Savings account statement

  2. Tax Return

    • An annual statement filed with tax authorities reporting income, expenses, and other tax-related information
    • Examples: Form 1040 (U.S. Individual Income Tax Return), W-2 (Wage and Tax Statement)

  3. Funds Transfer Confirmation

    • A document confirming the details of a funds transfer between financial accounts
    • Examples: Wire transfer confirmation, ACH transfer receipt

  4. Fundraising Document

    • A document detailing an investment made as part of a fundraising round for a company
    • Examples: Series A funding agreement, Convertible note purchase agreement

  5. Investment Document

    • A document confirming an individual’s investment in a financial vehicle like stocks, bonds, or funds
    • Examples: Stock purchase agreement, Real estate investment contract, Mutual fund statement, Brokerage account statement

  6. Loan Agreement

    • A contract detailing the terms of a loan between a lender and borrower
    • Examples: Personal loan agreement, Mortgage loan documents

  7. Invoice

    • A document detailing a transaction between a buyer and seller
    • Examples: Vendor invoice, Client bill

  8. Fundraising Announcement

    • A public announcement detailing a company’s successful fundraising round
    • Examples: Press release, SEC Form D filing, Crunchbase funding round announcement

  9. Capitalization Table

    • A table showing the equity ownership breakdown of a company’s shareholders
    • Examples: Cap table spreadsheet, Equity ownership summary

  10. Other

    • Any other document that provides a detailed explanation of a business’s source of funds
    • Examples: Notarized affidavit, Certified letter from accountant or attorney

Note: Screenshots of financial documents are not accepted as valid source of funds documentation.

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Request Schema

{
  "id": "business_123",
  "self_attested_data": {
    "business_name": "Example Corp",
    "source_of_funds": ["Investment", "Revenue"],
    "source_of_funds_documents": [
      {
        "url": "https://storage.example.com/funding_doc.pdf",
        "file_name": "series_a_funding.pdf",
        "source_type": "file_url",
        "description": "Series A funding documentation"
      }
    ]
  },
  "external_validation_data": {
    "source_of_funds": {
      "minimum_amount_to_verify": {
        "currency": "USD",
        "amount": 5000000.00
      }
    }
  }
}

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Configuration Options

The check can be configured with the following parameters:

  1. Validity Period

    • Number of days a document is considered valid from its issue date
    • Default: 365 days

  2. Minimum Amount Verification

    • Whether to enforce minimum funding amount requirements
    • Default: false

  3. Fraud Detection

    • Whether to enable document fraud detection
    • Default: false

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Response Interpretation

The check response includes:

  1. Valid Documents

    • Documents that passed all verification checks
    • Extracted information from each valid document

  2. Invalid Documents

    • Documents that failed one or more verification checks
    • Reasons for failure and missing information

  3. Verified Information

    • Confirmed business name
    • Verified source of funds
    • Verified funding amount
    • Document date

  4. Overall Result

    • Whether the check passed or failed
    • Detailed explanation of verification results
    • Any alerts or issues detected

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Common Alerts

The check may generate the following alerts:

  1. Invalid Document

    • Document is not a valid source of funds document
    • Missing critical information or improper format

  2. Missing Information

    • Document is missing required fields
    • Specific missing elements are identified

  3. Tampered Document

    • Document shows signs of manipulation or tampering
    • Specific fraud indicators detected

  4. Information Mismatch

    • Document information does not match self-attested data
    • Discrepancies between document and declared information

  5. Validity Period Expired

    • Document is outside the configured validity period
    • Document is too old to be considered valid

  6. Minimum Amount Not Met

    • Funding amount is less than the required minimum
    • Specific shortfall is identified

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Example Request

{
  "id": "business_123",
  "self_attested_data": {
    "business_name": "Example Corp",
    "source_of_funds": ["Investment", "Revenue"],
    "source_of_funds_documents": [
      {
        "url": "https://storage.example.com/funding_doc.pdf",
        "file_name": "series_a_funding.pdf",
        "source_type": "file_url",
        "description": "Series A funding documentation"
      }
    ]
  },
  "external_validation_data": {
    "source_of_funds": {
      "minimum_amount_to_verify": {
        "currency": "USD",
        "amount": 5000000.00
      }
    }
  }
}

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Example Response

{
  "passed": true,
  "explanation": "The source of funds document verification was successful. The document shows Series A venture capital funding of $5,000,000 for Parcha Labs, Inc., which matches the self-attested source of funds and exceeds the minimum amount requirement.",
  "payload": {
    "type": "KYBSourceOfFundsDocumentVerificationResult",
    "valid_documents": [
      {
        "extraction_data": {
          "is_valid_document": true,
          "analysis": "This is a valid fundraising announcement showing the business's source of funds.",
          "summary": "Series A funding announcement for Parcha Labs, Inc.",
          "date": "2024-02-01",
          "business_name": "Parcha Labs, Inc.",
          "document_type": "fundraising_announcement",
          "source_of_funds": "Series A venture capital funding",
          "amount": 5000000.00
        },
        "document": {
          "url": "https://storage.googleapis.com/example-bucket/funding_document.pdf",
          "file_name": "series_a_funding.pdf",
          "source_type": "file_url",
          "description": "Series A funding documentation"
        }
      }
    ],
    "invalid_documents": [],
    "verified_business_name": "Parcha Labs, Inc.",
    "verified_source_of_funds": "Series A venture capital funding",
    "verified_amount": 5000000.00,
    "verified_date": "2024-02-01"
  }
}