Source of wealth evidence: examples and how to assess them
I separate the wealth story from the evidence supporting it, then work through what employment, business-sale, inheritance and investment records can actually establish.
I treat source-of-wealth evidence as support for an explanation of how a customer built their overall wealth. A bank balance shows money is present; it does not, by itself, explain the activity that created it. My aim is to connect the customer's account, the relevant documents and the amounts over time, then state what the evidence supports and what remains unresolved.
Source of wealth and source of funds answer different questions
I start by separating the two questions. Source of wealth concerns the build-up of a person's assets. Source of funds concerns the origin of the money involved in a particular transaction or relationship. The FCA's Financial Crime Guide, section 3.2.6, makes that distinction in its UK supervisory context.
A customer may have built wealth through a business over twenty years, while funding this month's investment from a recent property sale. I would expect the explanation and evidence to reflect those different events. Asking for another statement from the sending account will not necessarily answer either one.
I also establish why the review is needed and which policy applies. Requirements depend on jurisdiction, customer risk and the relationship. I do not turn one institution's document list into a rule for every customer everywhere.
I write the wealth explanation before asking for documents
Before sending a request, I write a short account of the claimed wealth history: the activities involved, the periods, the approximate amounts and the people or entities connected to them. That is a working explanation to test, not an accepted conclusion.
“Business owner” is too thin to test. “Owned a regional maintenance company from 2013 to 2024, drew dividends while it traded, then sold the shares” gives me a sequence. I can identify which parts need corroboration and ask for records that address them. It also gives the customer a clearer request than “please provide sufficient source-of-wealth evidence”.
I keep the request proportionate to the question. If the unexplained part is a recent business sale, a large bundle of unrelated household statements may add inconvenience without reducing that uncertainty.
Source-of-wealth examples: what each document can show
I use document categories as starting points. Their value depends on what they establish in this file, whether they are credible and whether they agree with the rest of the explanation.
| Claimed source | Records I might examine | Question still to resolve |
|---|---|---|
| Employment and savings | Employment or tax records and relevant savings history | Do earnings, time and accumulated assets fit together? |
| Sale of a business | Ownership records, sale agreement and completion or settlement evidence | What did the customer own, and what did they personally receive? |
| Inheritance | Relevant estate or probate records and distribution evidence | Does the distribution connect this beneficiary to these assets? |
| Property or investments | Ownership, acquisition and disposal records; relevant investment statements | How much remained after debt, costs or other interests? |
These are examples, not an approved checklist. I would not describe a sale agreement as proof that every payment under it occurred. Nor would I treat a tax return as independent confirmation of every declaration it contains. I ask what the record was created to show before deciding what weight to give it.
I distinguish the money's origin from its route
A transfer from a regulated bank can help establish the route of money. It does not automatically establish the economic activity behind it. HMRC's guidance for supervised businesses explains that knowing funds came from a UK bank account is not enough to explain how the customer acquired them.
I therefore keep two threads visible: the event said to have generated the value, and the movement of the relevant proceeds. Where another person or company appears between those points, I ask about their role rather than assuming the connection. That is also where the wider EDD-file record needs to support the conclusion.
A worked business-sale example
Illustrative case
This is an invented training scenario. The names, amounts and dates are illustrative; it is not an account of a customer I advised.
Suppose Mira tells me she has £1.8 million in assets, mainly from selling a maintenance company in 2024. She proposes investing £250,000 from her personal savings account. The file contains a sale agreement showing a £1.4 million headline price and a bank statement showing a £900,000 receipt from a solicitor. A registry extract shows that she owned 75 per cent of the shares before the sale.
I would not write “£1.4 million business sale verified” against her personal wealth. Her shareholding, the headline consideration and the money paid at completion are different facts. I would ask for the completion statement and an explanation of any deferred consideration, debt settlement or allocation between sellers. I would also ask how the remaining claimed assets were built.
Now suppose the completion statement supports a £900,000 net payment to her, with £150,000 of deferred consideration still outstanding. She provides records supporting £500,000 of earlier savings and a property interest she estimates at £250,000. Those figures describe different things: cash received, a future contractual amount, savings and a property estimate. I keep them separate rather than presenting the total as verified liquid funds.
For the proposed £250,000 investment, I would then check the relevant account history and the explanation of the specific money being used. I might be able to support that transaction's origin while still needing clarification of part of her wider wealth. Equally, a convincing business history would not explain an unrelated recent credit into the account.
The useful output is the distinction between supported facts and remaining questions. A longer document list would not rescue an assessment that had confused the company's sale price with the customer's own proceeds.
What if older records no longer exist?
I do not assume that a missing document proves wrongdoing. Older businesses close, record-retention periods expire and people move between jurisdictions. I ask what other material can address the particular gap and record why the original evidence is unavailable.
AUSTRAC's Australian guidance distinguishes collecting an explanation from verifying it against documents or other evidence. That distinction is useful when reviewing a declaration: I can record what the customer says without describing the statement as independently verified.
I would look for a combination of relevant records rather than invent a universal substitute. A dated ownership record might support a past business interest; it would not establish the amount of every dividend. An adviser may be able to explain a transaction, but I still need to understand what information their explanation rests on.
If a material gap remains, I record its size and significance and refer it through the institution's authorised process. Acceptance, restrictions, further enquiry and any reporting consideration depend on the applicable rules and facts. I do not make an automatic reporting decision merely because one requested record is absent.
I make the next request specific
If I still need evidence, I explain the gap in language the customer can act on. Rather than repeat “source of wealth required”, I would ask for a record connecting the sale proceeds to their personal entitlement, or for an explanation of the difference between the agreement and the amount received. I identify an alternative route where the original record cannot reasonably be obtained.
I do not send the same request again merely because the first response was inconvenient to review. I compare the response with the question and record whether it answered it. If it did not, I explain the remaining uncertainty and use the appropriate internal escalation route instead of quietly changing the conclusion.
Before closing, I check that the file can be read in order: what was said, what I examined, what changed after the enquiry and why the proposed next step follows. That sequence helps a reviewer challenge my reasoning without having to guess which attachment I considered decisive.
What I want the final file to say
I want a reviewer to be able to follow the explanation without rebuilding my investigation. My note separates the customer's account from the records examined, identifies the dates and parties, and explains which conclusion each material record supports.
I then state the unresolved points and the action taken: what I requested, what arrived, what did not, who reviewed the gap and what decision they were authorised to make. For a corporate route, I connect that record to the ownership-chain analysis. I do not hide uncertainty behind “satisfactory documents received”.
My closing question is whether the next analyst can see both the reasoning and its limits. If they can only see a folder of attachments, I have more work to do.
Worth remembering: I use source-of-wealth evidence to test an explanation. I never let a document's presence stand in for the explanation itself.
