Business Identity
Understanding Business Identity verification
Straddle provides an Identity Verification module specific for Business Customers, operating in similar ways to our Identity Verification module for Individuals. This guide will walk you through the process of onboarding business customers using Straddle’s API.
Onboarding Business Customers using Straddle
To onboard a business customer using Straddle’s API, you’ll need to follow these steps:
- Collect Business Information: Gather the necessary information about the business, including: EIN, Legal Business Name, Business Address, and people associated with the business.
- Submit Business Information: Use Straddle’s API to submit the business information using the
POST /v1/customersendpoint. - Verify Business Identity: Straddle’s Identity Verification module will process the submitted information and generate a result for the business identity verification.
The process is similar to the individual identity verification process, but with additional fields for business-specific information.
Business identity verification will only be triggered if the Compliance Profile (EIN and Legal Business Name)
and Address are provided. It will be skipped if not, and the customer will be moved directly to verified status.
Business Identity Reason Codes
When using Straddle’s API for business verification, our system performs comprehensive checks on the business information you provide. These checks generate Business Identity (B) codes that offer insights into the verification results and help you make informed decisions about your business customers.
Overview
Business Identity codes are alphanumeric identifiers that start with the prefix “BI” and provide specific information about the business verification process. These codes help you understand:
- Whether the submitted business information matches official records
- The validity of the provided tax ID
- Potential discrepancies in business names or addresses
Business verification is crucial for regulatory compliance and fraud prevention. Always review these codes carefully to understand verification outcomes.
Interpreting Business Identity Codes
Business Identity codes typically fall into several categories, each providing information about different aspects of the business verification process:
Business Name & Tax ID Verification
These codes indicate whether the provided business name and tax ID match official records:
| Code | Description |
|---|---|
| BI301 | The submitted business name aligns with official records |
| BI302 | Minor typographical discrepancies have been detected in the submitted business name |
| BI304 | Notable discrepancies are present in the submitted business name compared to official records |
| BI305 | The submitted name appears to represent an individual rather than a business entity |
| BI102 | The provided tax ID is associated with the submitted business |
| BI103 | The provided tax ID does not appear to be associated with the submitted business |
| BI104 | The provided tax ID is linked to the individual named in the submission |
| BI105 | No confirmation is available that the provided tax ID belongs to the submitted business |
Address Verification
These codes help verify the submitted business addresses:
| Code | Description |
|---|---|
| BI107 | The provided address is associated with the submitted business |
| BI108 | The provided address is situated near the address on record |
| BI109 | The provided address includes slight errors but closely matches the address on record |
| BI111 | The submitted address does not appear to be associated with the business |
| BI112 | Verification of the submitted address could not be established |
People Affiliation
These codes provide information about the relationship between the submitted individuals and the business:
| Code | Description |
|---|---|
| BI601 | All named individuals appear to be affiliated with the submitted business |
| BI602 | At least one of the named individuals is affiliated with the submitted business |
| BI603 | Certain individuals not listed may also be affiliated with the submitted business |
| BI604 | None of the named individuals appear to be affiliated with the submitted business |
| BI605 | Affiliation of the named individuals with the submitted business could not be confirmed |
OFAC / Sanctions
These codes indicate whether the business or associated individuals appear on sanctions lists:
| Code | Description |
|---|---|
| BI201 | No sanctions or OFAC listings are identified for the submitted business |
| BI202 | No sanctions or OFAC listings are identified for the named individuals |
| BI203 | Sanctions or OFAC listings appear to be associated with the submitted business |
| BI204 | Sanctions or OFAC listings appear to be associated with one or more of the named individuals |
| BI205 | Sanctions or OFAC listings appear to be associated with certain individuals found in existing records |
| BI705 | The provided business information is limited, incomplete, or of uncertain reliability |
Registration & Standing
These codes provide information about the business’s registration status:
| Code | Description |
|---|---|
| BV101 | The business maintains state-level registrations in multiple jurisdictions |
| BV102 | The business maintains registration solely in one jurisdiction |
| BV103 | The business is registered in a state frequently chosen for entity formation |
| BV104 | No active state registrations are identified for the business |
| BV501 | Registration records indicate an active status and good standing in all relevant states |
| BV502 | Registration records indicate active status and good standing in certain states, while others vary |
| BV503 | Registration records indicate an inactive status or poor standing in all identified states |
Address Characteristics
These codes provide additional information about the nature of the business addresses:
| Code | Description |
|---|---|
| BV748 | At least one of the addresses provided is identified as residential |
| BV749 | At least one of the addresses provided is identified as commercial |
| BV750 | At least one of the addresses provided appears to be that of a registered agent |
| BV751 | At least one of the addresses provided appears to be a Commercial Mail Receiving Agency (CMRA) |
| BV752 | At least one of the addresses provided appears to be a private mailbox |
| BV753 | At least one of the addresses provided is not currently accepting mail deliveries |
| BV754 | At least one of the addresses provided appears to be a post office box |
| BV755 | At least one of the addresses provided appears to be a virtual address |
Location Usage
These codes indicate how many other businesses are using the same address:
| Code | Description |
|---|---|
| BV801 | At least one submitted location is shared by 1–20 other businesses |
| BV802 | At least one submitted location is shared by 21–100 other businesses |
| BV803 | At least one submitted location is shared by more than 100 other businesses |
Entity Type
These codes identify the legal structure of the business:
| Code | Description |
|---|---|
| BV010 | Records indicate the business is structured as a corporation |
| BV011 | Records indicate the business is structured as a limited liability company (LLC) |
| BV012 | Records indicate the business is registered as a nonprofit entity |
| BV013 | Records indicate the business operates as a partnership |
| BV014 | Records indicate the business is administered as a trust |
Business Formation & History
These codes provide information about the business’s establishment and history:
| Code | Description |
|---|---|
| BE500 | Formation records indicate an establishment date older than two years |
| BE501 | Formation records indicate the business was established within the past two years |
| BE502 | Formation records indicate the business was established within the last month |
| BE503 | Formation records indicate the business was established within the past year |
| BE1101 | No record of any bankruptcy filings exists for the business |
| BE1102 | Records indicate that the business has filed for bankruptcy |
| BE1201 | The provided TIN for the business is flagged or subject to a denylist status |
If you encounter any Business Identity codes not listed in this documentation, please contact Straddle support for clarification. Our verification system is continuously evolving to provide more detailed insights and better fraud protection.
Using Business Identity Codes in Your Application
When implementing business verification in your application, you can use these codes to:
- Automate decision-making based on verification outcomes
- Implement custom workflows for businesses that require additional review
- Provide specific feedback to users about their verification status
- Track verification metrics to identify common issues or trends
Best Practices for Business Verification
To maximize the effectiveness of your business verification process:
-
Implement a tiered verification approach: Use Business Identity codes to create different levels of verification based on risk and business type.
-
Collect comprehensive business information: The more detailed and accurate the initial business information, the more reliable the verification results will be.
-
Consider industry-specific risks: Some industries may require additional verification steps due to higher risk profiles.
-
Provide clear feedback to users: When a business fails verification, provide specific guidance on what information needs to be corrected.
-
Monitor verification patterns: Track common rejection reasons to identify potential improvements in your onboarding process.
-
Implement periodic re-verification: Business information can change over time, so consider implementing periodic re-verification for long-term customers.
For businesses that require manual review, consider requesting additional documentation such as business licenses, articles of incorporation, or utility bills to verify the business address.
Business Identity Scores
Straddle’s Business Identity scores are calculated based on the Business Identity codes and provide a numerical representation of the business’s verification status. These scores are not directly related to the business’s creditworthiness or financial health.
The Risk Scores range from 0 to 1 in the API, and are based on the number of codes in each category. The higher the risk score, the more scrutiny the business should receive in the event of a review status being assigned to it.
Testing Business Identity in Sandbox
While using Straddle’s Sandbox environment, you can tests the Business Identity verification by providing a specified set of data to test for each possible outcome by providing specific data in the address object, together with a business customer type and data on the compliance_profile.
| Address | Status |
|---|---|
| 1234 Sandbox Street, PO Box I304, Mock City, CA 94105 | review |
| 1234 Sandbox Street, PO Box I301, Mock City, CA 94105 | verified |
| 1234 Sandbox Street, PO Box I103, Mock City, CA 94105 | rejected |
Any data that is not in the above list will return a random result while in Sandbox, but always return the same output for the same input.