Source of Funds Documentation: What Counterparties Require

Source of funds documentation is one of the most consistently underestimated areas of counterparty due diligence. Bank statements alone are not the standard.

This briefing sets out the evidence types typically required: contemporaneous transactional records, contractual basis, tax records where applicable, third-party confirmations and a documented narrative tying the evidence together.

It also reviews the frequent deficiencies — inferred sources, non-contemporaneous reconstructions, gaps between the narrative and the underlying records — and the discipline required to close them.