CAMS · Question #546
A financial institution accepts new on-line customers. After customers have provided acceptable identification, the institution should next
The correct answer is A. Confirm the validity of the customer information. One of the essential components of customer due diligence is verifying the identity of the customer using reliable and independent sources. This verification process should be done before or during the establishment of the business relationship, and should not be delayed unless…
Question
A financial institution accepts new on-line customers. After customers have provided acceptable identification, the institution should next
Options
- AConfirm the validity of the customer information.
- BObtain an electronic picture of each customer.
- CClosely monitor the account for 30 days.
- DEstablish the account based on the information provided.
How the community answered
(53 responses)- A75% (40)
- B13% (7)
- C8% (4)
- D4% (2)
Explanation
One of the essential components of customer due diligence is verifying the identity of the customer using reliable and independent sources. This verification process should be done before or during the establishment of the business relationship, and should not be delayed unless there is a low risk of money laundering or terrorist financing, and the delay is necessary to avoid interrupting the normal course of business.
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