High Risk Activities

Description

Identifies businesses that engage in activities with a high compliance risk. Full list of activities is below.

Child attributes (and data file structure):

activity_type response values refer to high-risk categories of business activities.
compliance_risk_level is ‘high’ for all flagged businesses in Enigma KYB, which will expand in future iterations to varying levels of risk.

JSON sample

"activities": {
  "compliance_risk_level": "high",
  "activity_types": [
        {
            "activity_type" "Cannabis" 
        }
     ]
}

Coverage

Businesses: We have classified ~750K businesses as having high-risk activities. This includes online-only businesses (those without any identifiable physical address).
Locations: We have classified ~850K locations as having high-risk activities.

Data sources

High-risk activities is derived from the list of names, websites, and public web descriptions associated with a business via a set of heuristics. Names and websites are derived from all of Enigma's data sources, from card transactions to legal entity registrations.

Methodology

Enigma looks for keywords through industry descriptions, names, and website URLs associated with businesses. Enigma does not currently look at the content of a website.
For example, to classify a business as having a high-risk activity of "cannabis", Enigma looks for key terms within industry descriptions, names, and website URLs: cannabis, marijuana, dispensary, CBD, THC, Ganja.

Why use Enigma KYB’s high-risk classification?

Enigma’s high-risk classification improves automated customer onboarding by identifying businesses that engage in activities with a high compliance risk, allowing those businesses to be reviewed manually or follow additional risk assessment processes before onboarding. This increases confidence in your organization’s automated onboarding workflow and ensures you’re only bringing on businesses that meet your desired risk standards.

High-Risk Categories

Cannabis: Brick & mortar or online retail stores that primarily sell cannabis/marijuana and related products (THC, CBD, etc.), cannabis/marijuana growers or distributors, and software providers for the cannabis/marijuana industry.
Tobacco and Vaping: Brick & mortar or online retail stores that primarily sell tobacco and vaping products (cigarettes, cigars, e-cigarettes).
Firearms, Weapons and Ammunition: Brick & mortar or online retailers that primarily sell guns, firearms, weapons, and ammunition, shooting ranges, or related location.
Adult Entertainment and Dating: Dating (online dating sites and applications), Adult entertainment clubs (clubs that are primarily strip clubs, gentlemen’s clubs, sex clubs) but not businesses that are primarily just night clubs, adult entertainment retail stores (e.g., sex shops, but not other types of stores like lingerie stores), online adult entertainment sites (pornography sites, pay per view chat sites/apps)
Gambling and Sports Betting: Casinos, online gambling sites, sports betting websites and B&M retail locations, fantasy sports leagues (but not other sports-related businesses), bingo halls
Payments and Money Transfer: Payment processors, POS providers, crowdfunding sites, factoring, lending services
Multi-level marketing: Multi-level marketing, pyramid schemes
Pawn Shops, Check Cashing and Payday Loans
Cryptocurrencies and Digital Assets: Cryptocurrencies, blockchain, digital assets, digital wallets, crypto/blockchain related infrastructure
Investments and Financing: Investment brokers, lending instruments
Legal Finance: Collections agencies, bail bonds
Gift Cards: Gift card retailers, retail stores that buy unused gift cards, websites whose primary purpose is selling gift cards
Health and Lifestyle: Diet centers, supplements/nutraceuticals and other products not regulated by the FDA, hair extensions
Prescription Drugs: Pharmacies likely to sell prescription drugs