Customer Due Diligence in combating crime

All businesses and involved in financial transactions are at risk from financial crime. With criminal methods becoming increasingly sophisticated and complex, knowing exactly who you are dealing with is of paramount importance before any business is conducted.

But Customer Due Diligence is about so much more than just doing your homework on a potential customer or client prior to any businesses exchanges; it is making sure your company and employees have the know-how to review your client relationships on an ongoing basis and recognise if, and when, something that could signal a potential crime risk arises, and what needs to be done to prevent criminal or fraudulent activity unfolding.

As Richard Cook, Director Financial Crime in the Financial Policy and Operations Team at the British Bankers’ Association (BBA) says: “CDD is critical to anti-money laundering and fraud. KYB (Know Your Business) and KYC (Know Your Customer) are terms that are still used but over time they have become associated with research and verification carried out on day one of a business relationship. CDD goes way beyond that, ensuring businesses don’t accept clients outside of their normal risk tolerance, or whose business is not fully transparent.”

In an age where company business structures are becoming more complex and global, with company directors operating across multiple layers of a business do you really know who you are dealing with? If the answer is ‘no’ then you are at risk of potential exploitation. After all who knows to where the criminals may be siphoning off funds and for what purpose?

Governed by the Money Laundering Regulations 2007, Customer Due Diligence is about gaining and maintaining sufficient information about your customers and making effective use of it.

Our new Customer Due Diligence course helps your employees understand:
■the importance of pre and ongoing client monitoring / identity verification
■what the risks of not taking appropriate CDD measures are
■obtaining information on the purpose and intended nature of the relationship
■what constitutes reliable and independent source documents, data or information
■monitoring customer transactions and periodically reviewing the relationship
■how to respond in the event of a potential crime threat being identified through CDD

This new CDD course is part of our financial crime suite, which draws on the experience and subject matter expertise of our partners, the BBA and Wolters Kluwer Financial Services.

The suite includes such courses as ‘Money Laundering and How You Can Prevent It’ and ‘Countering Bribery and Corruption’ plus other useful modules on Complying with Sanctions and Fighting Fraud.

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