safeguarding sensitive information with advanced encryption
enhanced due diligence (EDD) is a risk based due diligence system that enables companies to manage high-risk transactions and customers, while also ensuring compliance with the laws. If properly implemented it safeguards businesses from serious reputational and legal penalties while ensuring that their Anti-Money Laundering (AML) and Customer Due Diligence (CDD) processes are efficient in combating financial crime.
In most cases, EDD is required when the transaction or customer is deemed high-risk due to complicated ownership structures, political exposure or involvement in industries prone to money laundering or financial criminality. In addition an important shift in the behavior of a customer for example, an increase in the volume of transactions or a change in the type of transactions could warrant an EDD. Additionally, any transaction that involves an area or country that is more prone to money laundering or terrorism financing requires an EDD.
EDD is focused on identifying beneficial owners, while revealing dangers, like the real beneficiaries of a particular account or transaction. It also detects suspicious and unusual patterns of transactions and validates the information with independent interviews and checks, website visits and confirmation from a third party. The risk assessment is carried out by a thorough examination of the local market’s reputation using media sources, and existing AML policy.
EDD is more than just a requirement to ensure compliance It’s an essential part in ensuring the integrity of the global finance system. Implementing effective EDD procedures isn’t just a matter of compliance–it’s an investment in the security and safety of the global financial system.