The problem
An LP committing to six US funds fills in six different KYC packages asking the same forty questions in different orders, each drafted by different counsel, each reviewed by counsel on both sides. A fund administrator asks a new investor forty questions that three other administrators already asked. An asset manager opening a separately managed account asks its new client the same forty questions its custodian asked last week. On the other side of the same fund, a deal partner screens the founders late, by email, because a bank asked whether anyone had.
None of that variation carries information. It is the seed round legal bill of private markets: weeks of elapsed time and real fees, spent producing a document a standard form would have produced in an afternoon.
The industry has a standard for what to ask. The ILPA Due Diligence Questionnaire reaches roughly 89 percent of private equity funds. It is a Word document. The industry has a standard for who an entity is, the LEI and now the verifiable LEI. Nobody has a standard for the thing in between: the completed, evidenced, certified pack. So every organisational boundary it crosses, somebody re-keys it.
Every vendor calls their product a passport. A passport that only works in one country is not a passport.
Scope
United States funds and asset managers, in both directions. The capital you accept and the capital you deploy. Any matter where one party has to satisfy itself about who the other is and where the money came from.
The mandatory federal floor is thinner than most managers believe. A US venture or private fund, and the adviser that runs it, is generally not a covered financial institution for anti money laundering purposes, so there is no AML programme, no customer identification programme and no suspicious activity report to file. The FinCEN investment adviser rule that would have changed that is delayed to 1 January 2028 and will be retailored before it lands, and most venture advisers are exempt reporting advisers in any case. Domestic beneficial ownership reporting was permanently eliminated in August 2026, so the registry funds were starting to lean on no longer holds ownership data for US companies.
What still binds: OFAC, with strict liability, no de minimis and no intent requirement, identically on the way in and on the way out; Rule 506(d) bad actor diligence, mandatory at every offering and again at each sale; accredited investor and qualified purchaser verification; cash reporting over ten thousand dollars; CFIUS, where a foreign LP base meets US critical technology; and the Outbound Investment Security Program, live since January 2025, on covered transactions.
That is not an argument for doing less. It is the reason a voluntary standard has value right now. Nothing that your bank, your administrator and your institutional LPs impose contractually moved when the rules did. What moved is that nobody is coming to tell you the shape of it, and when the rulemaking lands, whoever already has the rails wins. The practice note works through what that means in both directions.
What this deliberately does not do
It does not define an identity scheme, replace the ILPA DDQ, tell you whether to accept an investor or make an investment, tell you whether to trust a counterparty's certification, determine what the law requires of you, or constitute legal advice. Whether to take the money, or send it, is the manager's call on the manager's own responsibility. Each recipient makes its own risk decision the same way.
The machine readable version
Most adopters will only ever touch the form, and the form works on paper. For anyone building software against it, every field maps one to one onto a JSON file, so the same facts travel as a signed PDF, as JSON, or both. That layer carries a JSON Schema, rule packs over a FATF core, a reference validator and a 35 case conformance suite. Conformance is defined by the test suite rather than by the reference code: an independent implementation that reproduces all 35 expected outputs is exactly as conformant.