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What is a White Collar Crime? - Meaning Types & Impact of White Collar Crime | Anti Money Laundering - YouTube
Channel: KYC Lookup
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growing up i loved watching films but
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the criminal or the bad guy were always
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depicted as someone quite dirty maybe
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doesn't have a lot of money or didn't
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seem like the kind of person you wanted
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to be friends with
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but today's criminals or bad guys have
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become more sophisticated and have
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infiltrated many corporate industries
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long gone are the days of robbing
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someone on the street
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now they are working in industries where
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stealing a huge amount of money is only
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a few clicks on the button of their
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computer
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or simply having a conversation with an
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insider to get the information they need
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to conduct their crime
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in today's video we will be taking a
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look at what is white collar crime
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methods used by criminals of white
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collar crime and what impacts it has
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across different industries
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hello and welcome to another kyc lookup
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video where we bring you aml related
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content to help you enhance your
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knowledge in the fight against money
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laundering
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before diving into today's video be sure
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to subscribe so you don't miss out on
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any future videos oh and don't forget to
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leave us a comment with any suggested
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topics you would like us to cover in the
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future
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we also have a special announcement to
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make so be sure to watch until the end
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to find out what it is
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so
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on to today's video what is white collar
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crime
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in definition the term white collar
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crime refers to financially motivated
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non-violent or non-directly violent
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crime committed by individuals
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businesses and government professionals
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these crimes are categorized by deceit
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concealment or violation of trust to
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obtain or avoid losing money
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property services or to secure a
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personal or business advantage
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some may say these are victimless crimes
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as a corporation more often than not is
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the target
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however a single scam can destroy a
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company devastate families as their life
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savings have been wiped out or cost
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investors billions of dollars
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what types of white-collar crime are
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there
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there are many types of white-collar
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crime but the most common are corporate
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fraud
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embezzlement
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ponzi schemes
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extortion
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and bankruptcy fraud
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let's take a look at each one more
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closely
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corporate fraud
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according to the fbi the majority of the
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cases of corporate fraud they pursue
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involved fortification of financial
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information
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insider trading and schemes designed to
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conceal corporate fraud activities and
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impede the regulating bodies such as the
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securities and exchange commission from
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conducting their inquiries
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embezzlement
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embezzlement happens when a person
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entrusted by an employer or another
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person to handle money or property uses
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their position to misappropriate funds
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an example of embezzlement is when an
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employee finds ways to funnel company
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money into their own bank account
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another is when a politician spends
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campaign funds for their personal
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expenses
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ponzi schemes
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named after charles ponzi a con man in
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the 1920s
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a ponzi scheme is a type of investment
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scam that promises high returns for
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little to no risk
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people or organizations engaged in ponzi
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schemes focus their efforts on
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attracting new investors to pay the
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older ones
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the scheme falls apart when new
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customers stop coming in and the flow of
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new investments dries out
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if you want to find out more about
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charles ponzi and his schemes then
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please check out our video of the top 5
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con artists in history
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extortion
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extortion occurs when a person coerces
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an institution or another person into
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giving up property money or services
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an example is when gangs force store
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owners to pay protection money
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another is when a blackmail victim pays
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money to keep someone from publicly
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divulging information that could
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potentially harm their reputation
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bankruptcy fraud
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a person burdened with insurmountable
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debt can find relief by filing for
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bankruptcy
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this relief however comes at the expense
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of creditors who can only receive a
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portion of the debits non-essential
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assets or assets not necessarily to
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maintain a household or a job so if a
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filer intentionally hides property when
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filing out bankruptcy paperwork they can
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be accused of bankruptcy fraud
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now let's take a look at a very well
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known case
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bernie madoff was a very well known
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american financier who was found guilty
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of conducting one of the biggest ponzi
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schemes in recent history
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madoff defrauded thousands of investors
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out of tens of billions of dollars over
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the course of 17 years
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he had a very successful career as a
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trader and was the chair of the nasdaq
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in the early 1990s
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this he used at his advantage and
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created a front of respectability which
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gave his investors confidence to then
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invest in him
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madoff would take the client's money
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which he said he was investing but
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funneled it into one single account that
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he would then use to pay another client
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however when the markets dipped in 2008
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he was unable to keep up the system he
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had created and confessed to his sons
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the scheme he had been running
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his sons were unaware of their father's
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dealings and ultimately reported him to
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the authorities the day after his
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confession
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in 2009 at the age of 71 madoff pleaded
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guilty to 11 federal felony counts which
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included security fraud mail fraud
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perjury and money laundering
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he was sentenced to 150 years in prison
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he only got to serve 12 years as in 2021
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madoff died in prison
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what impacts does white collar crime
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have across different industries
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white collar crimes are more severe than
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any ordinary crime because in these
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cases financial losses are much higher
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and the damage is to public morale
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it is also known as socioeconomic crimes
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because it impacts adversely directly on
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society
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trust can also be lost which has a big
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impact on us all as we are putting our
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money into the hands of companies who
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are entrusted to take care of it
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it can also expose corporations to have
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big loopholes that can be manipulated
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and so they have to work hard to tighten
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their procedures and implement new ones
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as you can see
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even though white-collar crime is
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non-violent
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it still has a devastating effect on all
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those involved
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well there you have it what is
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white-collar crime methods used by
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criminals of white-collar crime and what
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impacts it has across different
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industries
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please tell us in the comments section
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what other white collar crime methods
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criminals use and other ways it can
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affect an industry
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now for the special announcement
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mentioned at the start of the video we
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are now launching our very own courses
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for you to take a more in-depth look at
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a variety of subjects such as
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introduction to aml beneficial ownership
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and customer risk rating for example so
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make sure you visit our website for
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further details and let us help you
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connect the dots in kyc
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thank you for watching the video and if
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you made it this far don't forget to
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