What is the objective of KYC procedures?

The objective of KYC (Know Your Customer) procedures is to verify the identity of clients and assess risk. KYC is a critical component in preventing fraud, money laundering, and other illegal activities that can occur in financial transactions. By ensuring that institutions know who their customers are, they can effectively evaluate the risk associated with each client, which is vital for maintaining compliance with regulations.

This verification process typically includes collecting personal information, understanding the customer’s financial activities, and assessing the overall risk they might pose to the institution. By understanding the customer's profile, businesses can apply appropriate risk mitigation measures and ensure adherence to legal obligations. This focus on identity verification and risk assessment is why option C accurately captures the essential purpose of KYC procedures.