CDM Compliance

FINOS Common Domain Model compliance in CreditNexus

CDM Overview

CreditNexus is fully compliant with the FINOS Common Domain Model (CDM), ensuring interoperability with other financial systems and adherence to industry standards.

Code Reference: app/models/cdm.py, app/models/cdm_events.py, .cursor/rules/cdm-compliance.mdc

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CDM Models

All financial data is represented using CDM models:

CreditAgreement

Represents credit facility agreements with parties, facilities, and terms.

Code Reference: app/models/cdm.py (CreditAgreement model)

Party

Represents counterparties (borrowers, lenders, guarantors).

Code Reference: app/models/cdm.py (Party model)

LoanFacility

Represents individual loan facilities within a credit agreement.

Code Reference: app/models/cdm.py (LoanFacility model)

TradeExecution

Represents trade execution events with CDM-compliant structure.

Code Reference: app/models/cdm_events.py (generate_cdm_trade_execution)

PolicyEvaluation

Represents policy decision events with evaluation trace.

Code Reference: app/models/cdm_events.py (generate_cdm_policy_evaluation)

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Policy Validation

Policy validation is embedded at the point of data creation using Pydantic model validators:

@model_validator(mode='after')
def validate_policy_compliance(self) -> 'CreditAgreement':
    """CDM-compliant validation at point of creation."""
    # Policy checks here
    return self

Code Reference: app/models/cdm.py (model validators), .cursor/rules/cdm-compliance.mdc

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CDM Events

All state changes and policy decisions are stored as CDM events:

TradeExecution Events

Record trade executions with CDM-compliant structure:

trade_event = generate_cdm_trade_execution(
    trade_id="TRADE_001",
    borrower="ACME Corp",
    amount=1000000.00,
    rate=5.25
)

Code Reference: app/models/cdm_events.py (generate_cdm_trade_execution)

PolicyEvaluation Events

Record policy decisions with evaluation trace:

policy_event = generate_cdm_policy_evaluation(
    transaction_id="DEAL_2024_001",
    transaction_type="facility_creation",
    decision="BLOCK",  # or "ALLOW", "FLAG"
    rule_applied="block_sanctioned_parties",
    related_event_identifiers=[],
    evaluation_trace=[...]
)

Code Reference: app/models/cdm_events.py (generate_cdm_policy_evaluation)

Observation Events

Record observations and verifications:

• Loan default observations
• Recovery action observations
• Verification results

Code Reference: app/models/cdm_events.py (generate_cdm_observation, generate_cdm_loan_default)

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Event Structure

CDM events include required fields:

• eventType: Type of event (e.g., “TradeExecution”, “PolicyEvaluation”, “Observation”)
• eventDate: ISO 8601 timestamp
• meta.globalKey: Unique identifier with issuer and assignedIdentifier
• relatedEventIdentifier: Links to related events

Code Reference: app/models/cdm_events.py (all event generators)

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CDM Compliance Principles

1. Validation at Creation

All CDM models validate policy compliance at the point of creation:

class CreditAgreement(BaseModel):
    # ... fields ...
    
    @model_validator(mode='after')
    def validate_policy_compliance(self) -> 'CreditAgreement':
        """CDM-compliant validation at point of creation."""
        # Check sanctioned parties
        if self.parties:
            for party in self.parties:
                if party.lei and self._is_sanctioned(party.lei):
                    raise ValueError(f"Party {party.name} is sanctioned")
        return self

Code Reference: .cursor/rules/cdm-compliance.mdc

2. Event Generation

All policy decisions generate CDM events:

# Policy evaluation
policy_result = policy_service.evaluate_facility_creation(agreement)

# Create CDM event
policy_event = generate_cdm_policy_evaluation(
    transaction_id=agreement.deal_id,
    transaction_type="facility_creation",
    decision=policy_result.decision,
    rule_applied=policy_result.rule_applied,
    related_event_identifiers=[],
    evaluation_trace=policy_result.trace
)

Code Reference: app/services/policy_service.py, app/models/cdm_events.py

3. State Machine Pattern

All state transitions use CDM-compliant state machine pattern:

• States are CDM-compliant
• Transitions generate CDM events
• State history is maintained

Code Reference: .cursor/rules/cdm-compliance.mdc

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CDM Event Storage

CDM events are stored in the database as JSONB:

class PolicyDecision(Base):
    __tablename__ = "policy_decisions"
    
    cdm_events: Mapped[dict] = mapped_column(JSONB)  # Store full CDM events

Code Reference: app/db/models.py (PolicyDecision, LoanDefault, RecoveryAction models)

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Compliance Checklist

• ✅ CDM model definitions (CreditAgreement, Party, LoanFacility)
• ✅ CDM event generation (TradeExecution, PolicyEvaluation, Observation)
• ✅ Policy validation at creation point
• ✅ Event storage in database (JSONB)
• ✅ ISO 8601 date formatting
• ✅ Global key generation
• ✅ Related event linking

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Additional Resources

• FINOS CDM Documentation
• CDM Compliance Rules
• Policy Compliance
• CDM Events Implementation

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Last Updated: 2026-01-14
Standard: FINOS CDM
Code Reference: app/models/cdm.py, app/models/cdm_events.py, .cursor/rules/cdm-compliance.mdc