Customer Due Diligence (CDD)
Definition
The FATF-mandated set of measures requiring financial institutions to identify and verify customers and beneficial owners, understand the purpose and nature of the business relationship, and conduct ongoing monitoring of transactions.
Related terms
- Beneficial owner
- The natural person who ultimately owns or controls an asset or entity, regardless of how many nominee or corporate layers stand in...
- Correspondent banking
- A relationship in which one bank (the correspondent) provides services such as clearing and settlement to another bank (the respondent), allowing the...
- Enhanced Due Diligence (EDD)
- A heightened set of CDD measures applied to higher-risk customers or relationships, including PEPs, high-risk jurisdictions, and certain business types. EDD typically...
- Politically Exposed Person (PEP)
- An individual who holds or has held a prominent public function, together with family members and known close associates, who presents a...
- Suspicious Activity Report (SAR) / STR
- A confidential report filed by a reporting entity to the national Financial Intelligence Unit when a transaction or pattern gives rise to...
Explained in
- AML Compliance: KYC, CDD, and Suspicious Activity ReportingThe FATF-mandated set of measures requiring financial institutions to identify and verify customers and beneficial owners, understand the purpose and nature of...