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Due diligence case creation

Suggest edit Updated on October 23, 2019

Pega Client Lifecycle Management for Financial Services provides an extensible design through an efficient case creation structure. The following Due Diligence subcases enable you to obtain data about customer risk:

  • Global & Local KYC
  • Tax (FATCA,CRS)
  • Credit
  • Legal

In the Global KYC section, the system considers the related parties that are added to the onboarding customer along with the main customer being onboarded and creates cases accordingly. In the Local KYC section, Pega Client Lifecycle Management for Financial Services creates sub cases for Anti-Money Laundering (AML) and regulatory rules based on the jurisdiction of the products and funds that are added to the customer being onboarded.

In the Tax due diligence section, subcases for applicable tax regulations, including FATCA and CRS, are created for the onboarding customer. In the Credit due diligence section, the system creates placeholder credit cases based on the sensitivity of the products being onboarded. In the Legal section, the system creates a placeholder legal case based on the sensitivity of the products being onboarded.

Before the start of due diligence stage, the system builds a page list for each type. Based on the results of the page list, it spins off the subcase for each result. The process to build the page list and case creation is different for each customer.

To explain this scenario, this article uses a sample structure for each available customer type in the onboarding journey (Organization, Individual and Fund Manager).

Organization customers

Customer ‘New Wave’ is of type Organization with the following associations:

  • Products in the jurisdictions of the United states of America (USA) and Great Britain (GBR)
  • Related party ‘Patricia Dobbie’ acting as primary point of contact
  • Related party ‘X’ acting as Ultimate Beneficial Owner(UBO) with 25% ownership stake
  • Related party ‘Kelly Deitch’ acting as CEO

The sub case structure that will be created as follows:

KYC Due Diligence

  • Create KYC due diligence
    • Global KYC case for main customer ‘New Wave’ with the applied KYC types
  • Related Party subcases(3)
    • A GKYC case for point of contact ‘Patricia Dobbie’ with the applied KYC types
    • GKYC case for related party ‘X’ only if it is defined as UBO, with the applied KYC types
  • Only if the percentage is > 20%
  • If the added UBO ‘X’ is individual, only one GKYC case is created
  • If the added UBO ‘X’ is organization, then the sub cases will be spun off for all its related parties (if the added related party is again an organization, cases will be spun off for them ad infinitum)
  • Local sub cases(2)(After completion of GKYC case of main customer ‘New Wave’)
    • AML & regulatory cases with the applied KYC types will be spun off by grouping the jurisdiction of the added products
  • AML-USA
  • AML-GBR
  • Regulatory – USA
  • Regulatory- GBR

Tax Due Diligence

  • Create Tax due diligence
  • 1 FATCA assessment case for the main customer ‘New Wave’ with the applied KYC types
  • 1 CRS assessment case for the main customer ‘New Wave’ with the applied KYC types

Credit Due Diligence

  • Create credit due diligence
  • 1 Credit case for all the case sensitive products that are added to the main customer ‘New Wave’. The case will be automatically resolved if the products are not credit sensitive)

Legal Due Diligence

  • Create legal due diligence
  • 1 Legal case for all the legal sensitive products that are added to the main customer ‘New Wave’ (case will be automatically resolved if the products are not legal sensitive)

Individual customers

Customer ‘Sophie James’ type Individual

  • Products of jurisdiction USA,GBR
  • Related party ‘Ben Tuk’ as Borrower (only individual can be added as borrower)

The sub case structure that will be created is as follows:

KYC Due Diligence

  • Create KYC due diligence
    • Global KYC case for main customer ‘Sophie James’ with the applied KYC types
  • Related Party subcases(1)
    • GKYC case for related party only if it is borrower
  • 1 GKYC case will be spun off with the applied KYC types
  • Local sub cases(2)(After completion of GKYC case of main customer ‘Sophie James’)

AML & regulatory cases with the applied KYC types will be spun off by grouping the jurisdiction of the added products

  • AML-US
  • AML-GBR
  • Regulatory – US
  • Regulatory- GBR

Tax Due Diligence

  • Create Tax due diligence
  • 1 FATCA assessment case for the main customer ‘Sophie James’ with the applied KYC types
  • 1 CRS assessment case for the main customer ‘Sophie James’ with the applied KYC types

Credit Due Diligence

  • Create credit due diligence
  • Credit due diligence case (only one case maximum) will be spun-off if only if there is any On boarding Product being Credit sensitive in any location in any Business Relationship for the Customer

Legal Due Diligence

  • Create legal due diligence
  • 1 Legal case for all the legal sensitive products that are added to the main customer ‘Sophie James’. The case will be automatically resolved if the products are not legal sensitive.

Fund Managers

Customer ‘Winter Rock Capital Group’ of type Organization but onboarding as Fund manager (managing customer of type Fund).

  • Related Party ‘X’ acting as Ultimate Beneficial Owner (UBO) with an ownership stake of 25%.
  • Related Party ‘Patricia Dobbie’ acting as Primary Contact
  • Fund A. Fund of type Hedge fund with ‘Helen Diebel’ acting as the Underlying Principal
    • Credit sensitive product ‘CDS’ in USA
    • Credit sensitive product ‘CDS’ in GBR
  • Fund B. Fund of type Hedge fund, with ‘Gupta Chandri’ acting as Underlying Principal
    • Credit sensitive product CDS in GBR
  • Fund C. Fund of type Pension fund, with ‘Helen Diebel’ acting as the Underlying Principal
    • Legally sensitive product Metal derivatives in CAN

The sub case structure would be as follows:

KYC Due Diligence

  • Create KYC due diligence
    • Global KYC (Fund Manager)
  • Related Parties
    • Fund cluster – Hedge Funds
      • Related Party
        • 1-N Underlying Principal subcases for all the distinct underlying principal for funds in this cluster. One case for Underlying Principal ‘Helen Diebel’ and another for ‘Gupta Chandri’.
      • Local
        • AML – US
        • AML – GBR
        • Regulatory – USA
        • Regulatory – GBR
  • Fund cluster – Pension Funds
    • Related Party
      • 1-N Underlying Principal subcases for all the distinct underlying principal for funds in this cluster. In this case no Underlying Principal cases as this was already created for ‘Helen Diebel’ previously.
    • Local
      • AML – CAN
      • Regulatory – CAN
  • A GKYC case for point of contact ‘Patricia Dobbie’ with the applied KYC types
  • A GKYC case for related party ‘X’ only if it is defined as UBO, with the applied KYC types
  • Only if the percentage is > 20%
  • If the added UBO ‘X’ is individual, only one GKYC case is created
  • If the added UBO ‘X’ is organization, then the sub cases will be spun off for all its related parties (if the added related party is again an organization, cases will be spun off for them ad infinitum)
  • Local (Applicable if Fund Manager has products in a Principal Relationship as well as a derivation of all the Fund products being managed)
  • AML – USA
  • AML – GBR
  • AML – CAN
  • AML - SGP
  • Regulatory – USA
  • Regulatory – GBR
  • Regulatory – CAN
  • Regulatory – SGP

Tax Due Diligence

Pega Client Lifecycle Management for Financial Services provides a dual approach for creating the tax subcases. Choosing one or the other will depend on the value for a Dynamic System Setting (DSS) to be created in the system. The DSS is named ‘clmfs/MultithreadTaxforFunds’, and can be given value ‘true’ or ‘false’.

If ‘clmfs/MultithreadTaxforFunds’ is equal false, then:

  • A single FATCA subcase and a single CRS subcase will be created for the whole Fund Manager scenario. Within that subcase assignments for Fund manager and the complete list of funds and all their products are shown in the header, above the FATCA or CRS questionnaire. That is to indicate the FATCA or CRS assessment is for the fund manager plus for the funds.

If ‘clmfs/MultithreadTaxforFunds’ is equal true, then:

  • 1 + N FATCA subcases and 1+N CRS subcases will be created.
    • The 1 subcase is ONLY for the fund Manager FATCA or CRS assessment.
    • The N subcases are for grouped funds by Underlying principal. So there will be as many N cases as distinct Underlying Principals in the list of funds. Cases for the sample scenario shown above will be:
      • 1 FATCA or CRS group for Underlying Principal ‘Helen Diebel’, containing Funds A and C. Within that subcase assignment the list of funds (A and C) and all their products will be shown in the header, above the FATCA or CRS questionnaire. That is to indicate the FATCA or CRS assessment is for those funds.
      • 1 FATCA and CRS group for Underlying Principal ‘Gupta Chandri’, containing Fund B. Within that subcase assignment the list of funds (B) and all their products will be shown in the header, above the FATCA or CRS questionnaire. That is to indicate the FATCA or CRS assessment is for that fund.

Credit Due Diligence

  • A maximum of one Credit due diligence case will be created if there is any credit sensitive product being onboarded in any location for any of the Funds for the business relationship. Funds/Products to be shown for the scenario will be:

Fund A .

  • Credit Sensitive product CDS in the USA
  • Credit Sensitive product CDS in GBR

Fund B.

  • Credit Sensitive product CDS in GBR

Legal due diligence

  • A maximum of only one Legal due diligence case will be created if there is any legally sensitive product being onboarded in any location for any of the Funds in the Business Relationship. Funds/Products shown for the scenario will be :

Fund C.

  • Legally sensitive product Metal derivatives in CAN.

The important rules used to implement the sub case creation in the Due Diligence stage are outlined in the following table:

Rule name

Rule set

Rule type

Description

PegaCLMFS-Work-KYC .pyDefault

PegaCLMFS

Case type

Call stages and processes in KYC.

PegaCLMFS-Work-KYC. pyStartCase

PegaCLMFS

Flow

Starter flow for the Local KYC case type.

AMLReview

PegaCLMFS

Flow

Get the local KYC case reviewed by the AML team.

LocalDueDiligence

PegaCLMFS

Stage

Includes all of the sub processes that should be launched on the start of the stage.

pyCaseManagementDefault

PegaCLMFS

Work Party

Contains all of the work parties that are used in the application.

AutomaticCurrentJurisdictionRegulatoryComplete

PegaCLMFS

Activity

This activity checks if the local case is to be autocompleted.

If it is not, it exits with counter value = 1.

If it is, it checks if the sibling for Regulatory is to autocomplete. If it is, then sets counter to 0.

ToCasePartyWB

PegaCLMFS

Activity

Router to the param party's default workbasket. Used to override the routing workparties in the event of local AML and regulatory cases and in the review for those cases.

During the review, the property "KYCReadOnly" indicates the case is in review state.

NavigationSidebar

PegaCLMFS

Section

Navigation Skeleton for Case Summary for KYC cases.


GlobalKYCReview

PegaCLMFS

Flow

A Flow to review the GKYC questionnaire.

CreateRelatedCases

PegaCLMFS

Flow

This flow is to trigger KYC cases for available related parties in the master profile.

CreateLocalReviewCases

PegaCLMFS

Flow

A Flow to review the LKYC questionnaire.

PropagateData

PegaCLMFS

Flow

It is intended to propagate data and decision from subcase to parent case.


PegaCLMFS-Work-GlobalKYC.pyStartCase

PegaCLMFS

Flow

Starter flow for the Global KYC case type.

GlobalDueDiligence

PegaCLMFS

Stage

Includes all of the sub processes that should be launched on the start of the stage.

RelatedPartyKYC

PegaCLMFS

Stage

Includes all of the sub processes that should be launched on the start of the stage.

PopulateTaxCasesList

PegaCLMFS

Data transform

Build the list of Tax sub cases that need to create subcases of Tax due diligence.

MapProcessToLooseLinkedSubcaseClass

PegaCLMFS

Decision Map

Returns the linked sub case class by taking the input as the process name.

PopulateLocalCasesList

PegaCLMFS

Data transform

Access the master profile and populate a list of local KYC cases to be triggered.

PopulateLocalCasesListForFunds

PegaCLMFS

Data transform

Access the master profile and populate a list of local KYC cases to be triggered for funds.

Tax

PegaCLMFS

Flow

Calls other processing sub flows to perform the overall Tax due diligence and evaluation process. Use this flow when a tax process is initiated to call other subflows and required processing.

Legal

PegaCLMFS

Flow

Process commanding the Legal subcase for the Pega Client Lifecycle Management for Financial Services application.

KYC

PegaCLMFS

Flow

Process commanding the Tax subcase for the Pega Client Lifecycle Management for Financial Services application.

Credit

PegaCLMFS

Flow

Process commanding the Credit subcase for the Pega Client Lifecycle Management for Financial Services application.

DueDiligence

PegaCLMFS

Stage

Includes all of the sub processes that should be launched on the start of the stage.

PropagateDataToParent

PegaCLMFS

Data transform

Copy the Override Assessment data from the work page to the Workfolder page.


PegaCLMFS-Work-Tax-CRS. pyDefault

PegaCLMFS

Case type

Case Type for every Tax due diligence subcase. Contains the general reusable Stages and Processes for Tax.

PegaCLMFS-Work-Tax-FATCA pyDefault pyDefault

PegaCLMFS

Case type

Case Type for every Tax due diligence subcase. Contains the general reusable Stages and Processes for Tax.


PegaCLMFS-Work-GlobalKYC. pyDefault

PegaCLMFS

Case type

Case Type for every GKYC due diligence subcase. Contains the general reusable Stages and Processes for GKYC.

PegaCLMFS-Work-Credit.pyDefault

PegaCLMFS

Case type

Case Type for every legal due diligence subcase. Contains the general reusable Stages and Processes for credit.

PegaCLMFS-Work-Legal .pyDefault

PegaCLMFS

Case type

Case Type for every legal due diligence subcase. Contains the general reusable Stages and Processes for legal.


PegaCLMFS-Work-Tax.pyStartCase

PegaCLMFS

Flow

Starter flow for the Tax case type.


PegaCLMFS-Work-Credit.pyStartCase

PegaCLMFS

Flow

Starter flow for the credit case type.


PegaCLMFS-Work-Legal.pyStartCase

PegaCLMFS

Flow

Starter flow for the Legal case type.

ReviewAndDecide

PegaCLMFS

Flow

Flow for reviewing the Tax related KYC types and decides whether to proceed or reject the case accordingly.

TaxDueDiligence

PegaCLMFS

Stage

Used in the Tax class, which is to be re-used in FATCA and CRS sub cases.

AssessmentExemption

PegaCLMFS

Stage

Used in the Tax class, which is to be re-used in FATCA and CRS sub classes.

FATCADetermination

PegaCLMFS

Flow

Top level entry workflow for creating a Tax Case. Calls other processing sub flows to perform the overall Tax process.


TaxReview

PegaCLMFS

Stage

Used in the Tax class, which is to be re-used in FATCA and CRS sub cases.

PopulateTaxCasesListForFunds

PegaCLMFS

Data transform

Builds the list of Tax sub cases for funds that need to create subcases of Tax due diligence.

NavigationDisplayLooseSubcases

PegaCLMFS

Section

Section showing information on loosely linked subcases on the case dashboard.

NavigationDisplayDeepLooseSubcases

PegaCLMFS

Section

Section showing information on loosely linked subcases on the case dashboard.

For a detailed understanding of every rule that is involved in this functionality, check for the following case type rules that drive into inner rules:

  • PegaCLMFS-Work-GlobalKYC.pyDefault
  • PegaCLMFS-Work-KYC .pyDefault
  • PegaCLMFS-Work-Tax-FATCA.pyDefault
  • PegaCLMFS-Work-Tax-CRS.pyDefault
  • PegaCLMFS-Work-Credit.pyDefault
  • PegaCLMFS-Work-Legal.pyDefault
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