KYC 2026: New Document Verification Requirements in Europe

European KYC regulations are undergoing their most significant transformation since the 4th Anti-Money Laundering Directive. The 6th EU Anti-Money Laundering Directive (AMLD6) is now entering enforcement, and national regulators across Europe are tightening supervisory controls. Obliged entities must fundamentally rethink their document verification processes. This guide covers the new requirements, the penalties for non-compliance, and the practical steps to get your business ready.

What Changes with the 6th Anti-Money Laundering Directive (AMLD6)

The 6th Anti-Money Laundering Directive (Directive 2024/1640), adopted as part of the EU's 2024 AML legislative package, sets an aggressive transposition timeline for member states. Most EU countries must finalize the integration of all provisions by the end of 2026.

Key Regulatory Changes

Three structural shifts redefine the obligations for regulated entities:

Lower beneficial ownership thresholds. The ownership threshold triggering beneficial owner identification drops from 25% to 15% for high-risk entities. For opaque structures (trusts, shell companies, layered corporate vehicles), the threshold drops to 5%.

Harmonized predicate offenses. The list of money laundering predicate offenses is now harmonized across the EU under the Anti-Money Laundering Regulation (Regulation 2024/1624). The 22 categories now explicitly include cybercrime and environmental fraud, broadening the scope of due diligence for all regulated businesses.

Mandatory enhanced due diligence. Enhanced due diligence measures become mandatory -- not optional -- for business relationships involving high-risk third countries, politically exposed persons (PEPs), and complex transactions exceeding EUR 10,000.

The Role of AMLA (Authority for Anti-Money Laundering)

The EU Anti-Money Laundering Authority (AMLA), operational since 2025 in Frankfurt, directly supervises the highest-risk financial entities across the bloc. It issues Regulatory Technical Standards (RTS) that national regulators -- such as the FCA in the UK, BaFin in Germany, or ACPR in France -- transpose into operational requirements for local entities.

AMLA's supervisory reach is substantial. It has direct oversight authority over approximately 40 cross-border financial groups deemed to present the highest money laundering risk. For all other obliged entities, AMLA coordinates national supervisors and can intervene when it identifies supervisory failures at the national level. The practical consequence: businesses can no longer rely on regulatory arbitrage between jurisdictions. A compliance gap tolerated in one member state will be flagged and escalated by AMLA's centralized risk assessment framework.

Strengthened Regulatory Requirements for 2026

National supervisory authorities across Europe have updated their guidelines for remote identity verification. In France, the ACPR has published detailed guidelines on customer identification and identity verification, which align with the broader EU AML regulatory framework. These guidelines, now binding in 2026, impose precise technical standards on regulated firms.

Identity Verification: The New Standards

Priority Supervisory Focus Areas

Regulators across Europe are concentrating enforcement on five critical areas that every regulated entity must master:

1. Quality of the identification process. Regulators verify that identity documents are checked against a documented technical framework, not by visual inspection alone.

2. Cross-referencing of collected data. Information extracted from documents must be cross-checked against official databases (sanctions lists, PEP registries, national watchlists).

3. Decision traceability. Every decision to accept or reject a client must be documented, timestamped, and linked to the supporting evidence.

4. Staff training. All employees involved in the KYC process must complete annual training with competency assessment.

5. Governance framework. A designated AML/CFT officer must validate procedures and report to the board of directors or supervisory board.

Who Is Affected: The Expanding Scope of Regulated Entities

The scope of entities subject to KYC obligations expands significantly in 2026. Beyond traditional players (banks, insurers, asset managers), new categories of businesses now fall under AML regulations.

Newly Regulated Entities

• Crowdfunding platforms licensed under the EU Crowdfunding Regulation (ECSPR), regardless of size.
• Crypto-asset service providers (CASPs), now subject to the Markets in Crypto-Assets Regulation (MiCA).
• Real estate dealers for transactions exceeding EUR 10,000.
• Sports agents and professional clubs for international transfers.
• Corporate service providers (registered offices, company formation agents).

Penalties for Non-Compliance

Penalties for KYC violations have been substantially increased:

How AI Is Transforming KYC Compliance

AI-powered KYC compliance is no longer a competitive advantage -- it is a regulatory necessity. Supervisory authorities themselves now recommend automated tools to achieve the reliability levels demanded by the new standards.

What AI Delivers in the KYC Process

Document forgery detection. Computer vision algorithms analyze over 120 control points on each identity document: MRZ zones, holograms, microprinting, typographic consistency, and digital alterations. The best solutions achieve a 99.2% detection rate for forged documents, compared to 65-75% for manual visual inspection.

Automated data extraction and verification. OCR (optical character recognition) combined with AI extracts document data in under 2 seconds, structures it, and verifies it against regulatory databases. A process that takes 15 to 25 minutes manually.

Continuous, dynamic screening. AI enables permanent screening of client databases against sanctions lists (UN, EU, OFAC), PEP registries, and adverse media databases. Alerts are prioritized by risk level, reducing false positives by 80% -- eliminating the bottleneck that overwhelms compliance teams.

Ongoing monitoring and risk reassessment. AMLD6 requires continuous monitoring of business relationships, not just point-in-time checks at onboarding. AI systems track changes in client behavior, corporate structures, and external risk indicators in real time. When a client's risk profile shifts -- due to a change in ownership, a new sanctions listing, or adverse media coverage -- the system triggers an automatic review, ensuring that security standards are maintained throughout the lifecycle of the relationship.

ROI of KYC Automation

Companies that automate their KYC processes see measurable gains:

KYC 2026 Compliance Checklist

Here is the action plan to achieve compliance with the new KYC requirements by the end of H1 2026.

Phase 1: Assessment (Q1 2026)

• Map all applicable obligations based on your regulatory status (credit institution, insurer, CASP, etc.).
• Audit your existing KYC framework (procedures, tools, training).
• Identify gaps between current practices and the new AMLD6 requirements.
• Estimate the volume of client files that need re-verification under the new thresholds.

Phase 2: Implementation (Q2 2026)

• Update your client risk classification to incorporate the new criteria (beneficial ownership thresholds, expanded predicate offenses).
• Deploy an automated document verification tool that meets the technical standards set by your national regulator.
• Integrate updated screening databases (AMLA lists, national registries).
• Train all relevant staff (initial training + competency assessment).
• Document procedures in an updated compliance manual.

Phase 3: Testing and Continuous Improvement (H2 2026)

• Conduct first-level internal controls on a sample of processed files.
• Stress-test the system with fraud scenarios (forged documents, synthetic identities).
• Establish monthly reporting to the AML/CFT officer.
• Prepare an evidence file in anticipation of regulatory inspection.

The Most Common Mistakes to Avoid

Analysis of regulatory sanctions published in 2024 and 2025 reveals recurring non-compliance patterns that businesses must correct immediately. France's Tracfin 2024 activity report underscores the scale of the challenge: 215,410 suspicious activity reports were received in 2024 (up 13% from 2023), and 3,998 intelligence notes were transmitted to judicial authorities and partner agencies.

Failure to update client files. 40% of sanctions issued in 2024 related to client files that had not been updated in over 3 years. Periodic review is not optional.

Underestimating PEP risk. PEP detection systems remain inadequate in many institutions, due to a lack of access to databases updated in real time.

Insufficient documentation of decisions. Accepting a client without documenting the reasoning behind the decision exposes the business to systematic sanctions during an audit.

Exclusive reliance on manual checks. Regulators now consider that visual inspection alone cannot achieve the reliability level required for document verification. Automation is de facto mandatory.

Fragmented technology stack. Many institutions use disconnected tools for document verification, sanctions screening, and PEP checks. This creates data silos, inconsistent risk scoring, and audit gaps. Regulators expect a unified, end-to-end process with a single audit trail. Investing in integrated solutions -- rather than patching together point tools -- is both a compliance and efficiency imperative. See our pricing for scalable options that consolidate these workflows.

Prepare Your Business Now

The 2026 KYC requirements are not a minor regulatory adjustment. They represent a paradigm shift in how businesses verify the identity of their clients and partners, aligned with the FATF Recommendations updated in October 2025. AI-powered automation is no longer optional -- it is a prerequisite for meeting the reliability standards demanded by regulators.

CheckFile supports regulated entities through this transition. Our AI-powered document verification platform meets the technical requirements set by European regulators and processes the entire KYC workflow -- from document capture to compliance decision -- in under 30 seconds. Request a demo to assess the gap between your current setup and the 2026 requirements.