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The Risk-Based Approach to Fighting Money Laundering: Client Risk

  • Domestic and international PEPs
  • Entity, structure or relationships of the client make it difficult to identify its beneficial owner or controlling interests (e.g., the unexplained use of legal persons or legal arrangements)
  • Charities and “not-for-profit” organizations that are not monitored or supervised by authorities or SROs
  • Use of financial intermediaries that are neither subject to adequate AML laws nor adequately supervised by authorities or SROs

Clients who:

  • conduct their business relationships or request services in unconventional circumstances;
  • are cash-intensive businesses (e.g., money service businesses and casinos), that are not usually cash-rich but generate substantial amounts of cash;
  • have no address or multiple addresses; or
  • change settlement or execution instructions.