#QuickBiteCompliance Day 98
🌟 Enhanced Due Diligence: Stopping Bad Guys in Their Tracks! 🌟
Imagine you’re the captain of a soccer team. You know most players on your team really well, but there’s a new player who seems a bit… mysterious. You’d want to know more about them, right? What’s their skill? What’s their strategy? That’s exactly what Enhanced Due Diligence (EDD) is like for banks and financial institutions!
💼 What is EDD?
EDD means looking closely at customers who might pose a higher risk—like people who suddenly make big money moves or have businesses in places known for shady activities. It’s like doing extra homework to ensure they’re playing by the rules.
🚨 How do bad guys use this to do financial crime?
Here’s how the “bad guys” might try to cheat the system:
1️⃣ Fake businesses: They pretend to own a store or company, but in reality, it’s just a cover to hide dirty money.
2️⃣ Complicated transactions: They send money through tons of countries or accounts to make it hard to trace where it came from.
3️⃣ False identities: Using fake names or documents to open accounts and avoid detection.
🔍 Why is EDD important?
Without EDD, these sneaky tricks could go unnoticed. But with extra checks, banks can say, “Hold on, this doesn’t add up!” By keeping customer profiles up-to-date and watching transactions closely, we can help stop fraudsters from winning the game.
💡 Simple Example:
Imagine someone opens an account for a “pet store” but deposits money like they’re selling sports cars. A deeper look (EDD) can uncover the truth—they’re hiding stolen money!
🛡️ Let’s keep fighting financial crime with smarter tools and sharper eyes!
#FinancialCrime #EnhancedDueDiligence #AML #Compliance #RiskManagement #Transparency #StopFraud #InclusiveRegtech #OpenSourceAML
Source: https://www.acams.org/en/resources/aml-glossary-of-terms