Illustrative Customer Due Diligence Templates Page 20
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25EP 200 IG 2
Section 4: Risk Evaluation
Initial CDD procedures should be conducted as follows:
“Low” risk rating: Simplified CDD should be performed.
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“Normal” risk rating: Normal CDD should be performed.
-
“High” or “Medium” risk rating: Enhanced CDD should be performed.
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The following risk evaluation is to assist in determining what level of ongoing monitoring and CDD should
be conducted.
Instructions
1. Obtain an initial risk rating, being the highest risk indicator in Section 1.
2. Provide justifications in Section 2 to adjust the initial risk rating in Section 1, if considered justifiable,
subject to the following conditions:
High risk rating should NOT be reduced if Client is attached to any of the following risk factors:
Section 1 : PEP, Section 2 : High-Risk Jurisdictions
Justifications must also be provided for adjustment from High-Risk to Low-Risk in Section 3
Section 1 : Current risk rating of existing
client; OR Initial risk rating for new client
High
Normal
Low
or existing client with no previous risk
rating
Section 2 : Justifications
Section 3 : Justifications
Section 4 : Final Risk Rating
High
Normal
Low
Section 4 is to be signed off by the Money Laundering Reporting Officer (MLRO) if it differs from
Section 1.
The final risk rating may be used as a guide to the level of ongoing monitoring that the client should be
subject to. This only serves as a guide and professional judgment should still be exercised in deciding on
the appropriate level of ongoing monitoring and CDD processes.
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