Which of the following poses the greatest money laundering risk for a financial institution offering on-line services to customers?

The correct answer is A. There is greater difficulty in matching the customer with the provided identification doc-. According to the Anti-Money Laundering Specialist (the 6th edition) study guide, one of the main challenges of providing on-line services to customers is the verification of their identity and the authentication of their transactions. The lack of face-to-face contact and the use

Risks and Methods of Money Laundering and Terrorist Financing

Question

Options

AThere is greater difficulty in matching the customer with the provided identification doc-
BThere is no human scrutinizing the customer's transactions, thus increasing the potential for large
CInstitutions offering on-line services have no possibility to properly verify the identity of their
DCustomers can directly access their accounts without being detected.

How the community answered

(18 responses)

A
83% (15)
B
11% (2)
C
6% (1)

Explanation

According to the Anti-Money Laundering Specialist (the 6th edition) study guide, one of the main challenges of providing on-line services to customers is the verification of their identity and the authentication of their transactions. The lack of face-to-face contact and the use of electronic documents increase the risk of identity fraud, impersonation, and account takeover. Therefore, financial institutions offering on-line services need to implement robust customer due diligence (CDD) measures, such as using multiple sources of information, verifying biometric data, and applying risk-based monitoring.

Topics

#online banking#customer identification#digital channel risk#non-face-to-face

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