Podcast
Questions and Answers
Which of the following is NOT a requirement for enhanced due diligence (EDD) for a legal person?
Which of the following is NOT a requirement for enhanced due diligence (EDD) for a legal person?
What does EDD stand for?
What does EDD stand for?
What approach do EDD investigations adopt?
What approach do EDD investigations adopt?
What is the purpose of EDD in determining the beneficial owners and controllers of a customer?
What is the purpose of EDD in determining the beneficial owners and controllers of a customer?
Signup and view all the answers
What might be included in the policies and procedures for EDD?
What might be included in the policies and procedures for EDD?
Signup and view all the answers
Study Notes
Enhanced Due Diligence (EDD) Overview
- EDD stands for Enhanced Due Diligence, which involves a deeper level of scrutiny in risk assessments for customers and their activities.
- EDD investigations typically adopt a risk-based approach, focusing on higher-risk clients or transactions that pose potential threats to the institution.
Requirements for EDD
- Common requirements for EDD include verifying the identity of beneficial owners and understanding the nature of their business activities.
- One requirement that is NOT typically included may refer to standard verification processes which are less intensive than those utilized in EDD.
Purpose of EDD
- EDD aims to identify beneficial owners and controllers, ensuring transparency and mitigating risks associated with money laundering and other illicit activities.
- By determining the actual controlling entities behind a legal person, EDD helps in preventing the misuse of corporate structures for fraudulent purposes.
Policies and Procedures for EDD
- Policies and procedures for EDD may include comprehensive client background checks, monitoring of ongoing transactions, and enhanced reporting mechanisms.
- Ongoing employee training to recognize and respond to potential red flags in high-risk customers is essential to maintain effective EDD practices.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Test your knowledge on enhanced due diligence (EDD) for legal persons in this quiz. Learn about the importance of understanding your customer's business, conducting further fact-finding, and verifying disclosed information. Explore the policies and procedures necessary for effective EDD.
