Which of the following are risk factors a financial institution should examine when onboarding a new corporate customer? (Select Three.)

The correct answer is A. The type of business the corporate customer is engaged in. D. The identity of senior managing officials and all individuals authorized to operate the account. E. The country or location where the customer is from or conducts business.. When onboarding a corporate customer, financial institutions must conduct due diligence to assess potential AML risks. Option A (Correct): Understanding the nature of the business helps identify higher-risk industries (e.g., casinos, cryptocurrency exchanges, cash-intensive busin

AML/CFT Compliance Programs

Question

Options

AThe type of business the corporate customer is engaged in.
BThe employment profiles of all employees of the new customer.
CAll the financial institutions where the new customer currently banks or has banked previously.
DThe identity of senior managing officials and all individuals authorized to operate the account.
EThe country or location where the customer is from or conducts business.

How the community answered

(50 responses)

A
80% (40)
B
6% (3)
C
14% (7)

Explanation

When onboarding a corporate customer, financial institutions must conduct due diligence to assess potential AML risks. Option A (Correct): Understanding the nature of the business helps identify higher-risk industries (e.g., casinos, cryptocurrency exchanges, cash-intensive businesses). Option D (Correct): Identifying senior managing officials and account signatories helps verify the true control and ownership of the company. Option E (Correct): Jurisdictional risk assessment is key, especially if the company is from a FATF-listed high-risk country.

Topics

#corporate customer onboarding#KYC risk factors#customer due diligence#beneficial ownership

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