What is KYC, and Why is it Important for Your Converter Recycling Business?


If you're involved in converter recycling—whether as a buyer, scrap yard owner, or automotive recycler—you're probably aware of the growing problem of converter theft. Catalytic converters are valuable because of the platinum, palladium, and rhodium they contain, which makes them prime targets for theft.

That's when Know Your Customer (KYC) protocols become crucial—and so is partnering with a business who upholds them. But what exactly are KYC guidelines, and how does it benefit your business? If you’re ready to get all the answers, watch our video below or keep reading.

Know Your Customer—and Keep Knowing Them

KYC protocols allow you to verify the identities of your sellers, ensuring that you’re not working with businesses engaged in illegal activities such as money laundering. By requiring specific documentation, you can make informed decisions about who you work with and stay on the right side of all legal standards.

Here’s the documentation you should require for new sellers/partners:

  • Demand a photo I.D from the seller, a business registration, and any other required permits.
  • Demand proof of vehicle ownership or vehicle identification numbers (VINs) for the converter being sold.

You should also check in with your sellers regularly to make sure their documentation is up to date. If a business registration, photo I.D, or license has expired, demand a copy of the renewed document to add to your files.

Here are some other tips for ethical converter sourcing:

  • Refuse cash-only transactions.
  • Refuse any converter that looks brand-new.

PMR's Commitment to KYC

At PMR, we uphold strict KYC protocols for every recycler seeking to partner with us. This involves obtaining valid business registrations, photo identification of business owner(s), and any required recycling licenses or permits mandated by state or local regulations. This ensures that our partners are committed to ethical practices and operate within the law.

Our commitment to KYC doesn't end there. We monitor the expiration dates of our supplier’s documents, ensuring that they maintain compliance with legal requirements and give us their most updated papers.

Why is KYC Important?

Implementing KYC protocols not only protects your business from potential risks associated with illegal entities but also maintains ethical standards in the converter recycling industry as a whole. Working with ethical partners is essential for maintaining operational integrity and avoiding scrutiny from law enforcement agencies.

Responsible converter sourcing also contributes to ethical supply chains, supporting the industries that rely on the precious metals contained in converters. At PMR, we remain committed to supporting recyclers in responsibly sourcing catalytic converters and helping them sustain vital sectors of the economy.

For further information, please visit PMR's Resource Center.

Published: March 20, 2024
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