You may be taken aback or get surprised at the type of personal information related questions your online trading platforms can ask you before you can register or open an account with them. The details and purpose of collecting this information are actually based on the concept that online trading platforms want to know you as a customer.
Plus, the collection of information is also a part of KYC or Know Your Customer is a mandatory requirement by the trading laws that online trading platforms must abide by. This information can be provided to the Securities and Exchange Commission or SEC in case of any dodgy or suspicious activities.
Knowing your client or customer is a standard practice in the trading and investment sector. It is obligatory for the trading platforms such as Global CTB Review to have detailed information about every trader that dwell on their platform and indulge into trading. The platform must keep track o clients’ risk tolerance, finances, and investment experiences.
Know Your Customer (KYC) Rule
The account that you sign up for and set up requires it to be established in a manner that protects your interest as well as the interest of other traders, customers, and the trading platform itself.
The online trading platform does not want to put their platform and other traders in a situation where a novice trader or any other trader without experience starts borrowing capital or engage in trading without any prior knowledge or experience of trading.
The platforms also cannot afford that any of their online traders, including yourself, lose money and then come up with a claim that you had no idea or prior knowledge about how the online trade market operates or functions.
Also, these online trading platforms require having your personal details and information to stay compliant with
- Tax laws
- Investment risks suitability
- Anti-money laundering laws
- Record keeping
- Anti-terrorist funding prevention
Apart from capturing your basic information like your full name, residential address, email and contact numbers, date of birth, the online trading platform such a Global CTB Review may also ask you to provide information such as tax identification number. In case you are opening a trading account as an independent trader, they can ask you for your Social Security Number.
In case you are opening an account as a corporation or a trading business entity, then the online trading platform can ask for your business’ tax identification number.
If you are registering on a trading platform in the US, but you are not a US citizen, then the online broker will most likely ask you to use your valid foreign passport. They also ask you to provide an additional valid identification card or number issued by the government of your country of residence.
The online trading platforms may also ask you to provide for emergency contact numbers, and you may also be asked which account type you wish to open and why?
Perform Due Diligence
Before you open an account with an online broker, and provide your sensitive information, perform due diligence on your part. Always make sure that the platform is genuine because giving out all your information to a fake website will certainly expose you to cyber-fraud by stealing your information and identity theft, etc.
While it is perfectly legal for online trading service providers to gather your personal information, make sure you check that you are providing your details to a legitimate entity. Look for an online review about the platform you are considering and try and contact other members in the community section to get to know how the platform works and if it is any good.