Customer Due Diligence (CDD)
How do you handle high-net-worth individuals (HNWIs) in KYC processes?
Last Updated: November 2, 2025HNWIs are generally treated as higher-risk and require Enhanced Due Diligence (EDD). This includes detailed scrutiny of their complex financial...
What are the typical KYC documentation requirements for corporate clients?
Last Updated: November 2, 2025Documentation includes the Certificate of Incorporation, proof of business address, Articles of Association/Bylaws, identification for key individuals (directors, authorized signers),...
Explain the term ‘Ongoing Monitoring’ in the context of KYC.
Last Updated: November 2, 2025It is the continuous, iterative review of the customer’s transactions and activities to ensure they remain consistent with the customer’s...
What is a KYC risk assessment?
Last Updated: November 2, 2025It is the process of evaluating the inherent ML/TF risk posed by an individual customer based on their characteristics (e.g.,...
How do you verify the source of funds in CDD?
Last Updated: November 2, 2025Verification is achieved by examining reliable third-party documents such as bank statements, audited financial statements, salary slips, tax returns, or...
How do you handle discrepancies in customer identification information?
Last Updated: November 2, 2025Discrepancies must be investigated. This involves requesting additional or clarifying documentation from the customer. If the discrepancy cannot be resolved...
What is the purpose of Enhanced Due Diligence (EDD)?
Last Updated: November 2, 2025The core purpose is to obtain a more comprehensive understanding of the higher-risk customer, their background, source of wealth/funds, and...
What is the purpose of verifying a customer’s source of funds?
Last Updated: November 2, 2025To ensure that the money being used for the transactions or relationship is not derived from illegal activities. It is...
Describe the process of the Customer Identification Program (CIP).
Last Updated: November 2, 2025CIP is the formal process within KYC that involves collecting and verifying the required identifying information prior to or at...
What information is typically required for CDD?
Last Updated: November 2, 2025Required information includes the customer’s full legal name, physical address, date of birth, a government-issued identification document (passport/license), and details...
What is the difference between Basic Due Diligence (BDD) and Enhanced Due Diligence (EDD)?
Last Updated: November 2, 2025BDD (or CDD) is the standard procedure for identity verification and basic risk assessment. EDD is the more rigorous process...
