The email is always short. Please provide proof of funds. What follows is usually a week of the client sending screenshots, the compliance team rejecting them, and everyone growing frustrated. The underlying obligation is legitimate and unavoidable. The execution is where firms lose clients.
Proof of funds is not source of wealth
These two get used interchangeably and they are different questions.
Proof of funds asks where this specific money came from and confirms the client actually holds it. A statement showing the balance and the incoming transfer answers it.
Source of wealth asks how the client accumulated their overall assets over time. Employment history, a business sale, an inheritance, property proceeds. It is a broader question, it is asked of higher-risk or higher-value relationships, and a bank statement alone does not answer it.
Firms that send one template for both create confusion. A client depositing an amount that triggered a threshold check needs to prove the funds. A client whose profile triggered enhanced due diligence needs to explain the wealth. The source of funds checks piece goes through when each is required, and the KYC verification levels guide covers how tiers escalate.
What is normally accepted
Requirements vary by firm and jurisdiction, but the documents that generally satisfy a reviewer share three properties: they are issued by a third party, they carry a date and the client's name, and they show a trail rather than a number.
| Document | Answers | Common rejection reason |
|---|---|---|
| Full bank statement, recent period | Proof of funds | Cropped, partial page, or name and account number hidden |
| Payslips over several months | Source of funds and wealth | Only one month supplied, or employer not verifiable |
| Tax return or assessment | Source of wealth | Unsigned or wrong year |
| Sale contract plus the receiving credit | Both, for a one-off event | Contract supplied but the money trail is missing |
| Exchange transaction history | Crypto proceeds | Wallet screenshot with no link to an identified account |
The most common rejection is the cropped screenshot. A client hides their balance or their address, believing it is irrelevant, and removes exactly the fields the reviewer needs to match the document to the account on file. Say this explicitly in the request and the rejection rate drops.
Crypto deposits are their own category. A wallet address and a block explorer link show a transfer, not a person. Reviewers usually want the exchange account statement that ties the withdrawal to a verified identity, which is why the on and off ramp piece and the travel rule explainer matter for anyone funding an account this way.
Never ask a client to email documents to a general inbox. Identity documents and full bank statements in a shared mailbox are a data protection incident waiting to happen. Collect them through the portal, with access limited to the review team and a retention period you can actually justify.
Why the request appeared at all
Four triggers cover most cases. A deposit or a cumulative pattern crossed a monetary threshold in the firm's policy. The payment method or the originating country raised the risk score. The client's activity does not match the profile they declared at onboarding, which is the classic case of a stated modest income and a large first deposit. Or a withdrawal request arrived for funds that were never properly evidenced on the way in.
That last one causes the most anger. A client who deposited without question and is now blocked from withdrawing reasonably feels the firm changed the rules. Operationally the fix is to run the check at deposit rather than at withdrawal, which is exactly the argument made in the piece on AML holds on withdrawals. Verifying money on the way in is a customer service decision as much as a compliance one.
How to write a request that gets answered
A good request names the document, the period, the format and the reason. Compare "please provide proof of funds" with "please upload a complete PDF bank statement for the account ending 4471 covering the last three months, showing your name and address, so we can release the deposit of 12 March". The second one gets answered in a day.
Three more things help. Give a deadline and say what happens if it passes. Tell the client whether trading or withdrawals are restricted meanwhile, because silence on that point generates support tickets. And when you reject a document, say which specific requirement it failed rather than sending the same template again.
On the firm side, log every request and every decision against the client record with the reviewer's name and timestamp. When an examiner asks why a particular deposit was accepted, the answer needs to be a file, not a memory. The record-keeping expectations are set out in the AML basics for trading firms, and firms handling this at volume should read the compliance audit trails piece before designing the workflow.
For the client on the other side
Send the complete document, unedited, as a PDF from the source rather than a photo of a screen. Include every page even if some are blank. If the money came from somewhere unusual, explain it in a short covering note and attach the supporting paper, because an unexplained large credit invites a second round of questions. And expect that a firm which never asked you anything at deposit will ask everything at withdrawal.
None of this is optional for a regulated firm, and the requirements differ by jurisdiction and by the firm's own risk policy. This is general information rather than legal or compliance advice.
"Half of these cases are a bad request, not a bad client. If you ask for proof of funds without saying which document and which period, you have created your own backlog."
— Roman Onta, Executive Director, SINGUARD
Key Takeaways
- Proof of funds evidences a specific sum; source of wealth explains how overall assets were built. Asking for the wrong one wastes a review cycle.
- Reviewers need third-party issued documents with the client's name, a date and a visible trail. Cropped screenshots are the most common rejection.
- Running the check at deposit rather than at withdrawal prevents the worst client experience, where funds are accepted and then blocked on the way out.
- Requests should name the document, the account, the period and the reason, and every decision should be logged against the client record for examiners.
Frequently Asked Questions
What counts as acceptable proof of funds?
Usually a complete, recent bank statement issued by the institution, showing the client's name and the relevant credit. Payslips, tax documents or a sale contract with the matching bank credit are used depending on what the money is.
Why was my bank statement rejected?
Most often because it was cropped, was a screenshot rather than the issued document, was missing pages, or had the name and account details hidden. Reviewers need to match the document to the account on file.
Can a firm hold my withdrawal while it reviews documents?
Regulated firms are required to complete due diligence and may restrict activity while a check is outstanding. The specific rights and timelines depend on the jurisdiction and the firm's terms, so read them and ask what is restricted meanwhile.
About the Author
Roman Onta is an Executive Director at SINGUARD. He builds the Prop Firm CRM, the Broker CRM, Scalegram and CopySignals side by side with his brother Alex Onta, and he helped on the design of eTrader, the division Alex built and leads. His ground is worldwide payment processing, AML compliance and the corporate structures brokers are built on, work the two of them carry together, shaped by executive roles in the UAE and international corporates. He lives and works in Dubai for most of the year. Meet the executive duo leading Singuard's five divisions.