Customer Due Diligence Checklist – 5 Steps to Improve Your CDD

Customer due diligence is one of the most essential elements of client management. The financial institutions must ensure that they follow a systematic CDD process to identify if their clients are not involved in any financial crime or fraudulent activities.  However, due to the advancement of technology and availability of several tools the finance service landscapes are witnessing great difficulties in identification and verification.

The AML software solutions focus on the requirements and requisites of banks and financial institutions. It allows one to assess the client information and regulate risk monitoring. They can play a vital role in enhancing the Customer due diligence system and bringing stability to it. 

Furthermore, CDD is a wide term, it involves lots of intricacies and technical elements. Sound knowledge of the field, technology and hands-on experience in customer management is a must to master it. 

Here Are 5 Steps To Improve Your CDD

  • Step 1: Verify Customer Identities: One of the most important steps of CDD is the verification of customer identity. This can enable the financial institution to cross-check the identity details provided by the client. The AML solutions for banks make it simple and easy to verify customer identity. The AI-based ID verification method is a secured and most convenient method for verification. 

The increasing scope of digitalization has made it imperative for financial institutions and banks to verify customer identity. It allows one to get information about the client and secure regulatory compliance too. The customer identity verification can enable client executives to develop powerful diligence for client business relationships and transition monitoring too. 

  • Step 2: Assess Third-Party Information Sources: Many financial institutions and banks rely on third parties for customer due diligence. It is imperative to assess third party information sources and ensure that their practices and business policies align with the banking/institution. The AML software solutions facilitate better compliance by providing accurate information about third party sources for optimum assessment.
  • Step 3: Secure Your Information: The AML transaction monitoring software is crucial. It allows one to secure the information of the client. Moreover, the monitoring software provides incredible insights about the client and enables one to classify the risk category accordingly. The comprehensive and secure data and information processing, collecting and documenting whilst mitigating any potential risk.
  • Step 4: Take Any Necessary Additional Measures: Enhanced Due Diligence is a major part of CDD. It enables you to regularly monitor the client. EDD is necessary for accounts with high transaction values. EDD using AML software solutions helps one take any necessary additional measures. 
  • Step 5: Ensure You’re Audit-Ready: The data and details of all CDD and EDD processes are significant. It can be used for any future regulatory obligations. The AML software solutions store the ongoing CDD ensures the utmost security of remote verification and decreasing risk. It can considerably improve the performance of financial intelligence and streamline the CDD process. It makes one audit-ready with its systematic and efficient compliance program. 

The Bottom Line

Effective CDD can help you to better manage the client information, identify potential risks and promote vigilance. It can create a transparent, standardized and strong system. Therefore, enhance your CDD process and establish values and procedures that compliments regulatory obligations with AML software solutions. Connect for the AML software demo now!

4 Ways to Protect Your Financial Institution against Money Laundering

The weakness in a bank or a financial institution becomes the target of a fraudster. Banks and financial institutions can falter the fraudsters with the help of efficient anti-money laundering schemes. Any financial institution, large, medium or small can become a victim of the treacherous plan of a criminal. To prevent from falling into the traps of such criminals it is better to have some handy methods. This post lists 4 ways to protect your financial institution against money laundering.

Enhance searches

It is extremely tough to separate serious and potential threats from a plethora of false positives that turn during the search. There are a variety of alerts that have to be looked at to lay a net over the account in a financial institution. If the false positives are brought under control, the scope of accounts can be expanded for effective reporting. With help of AI-powered AML transaction monitoring software, constant searches can be done and the burden of false positives can be reduced.

Due diligence

You should investigate anyone who is involved with the transactions. For instance, if a stranger wants to offer you huge money, you haven’t hit the jackpot. It can most probably be a money-laundering scheme. Before accepting anything, conduct a thorough background check on the person. Look into whether the person has been involved in any crime. You should be aware of everyone involved in the case. Analyze the relationship of everyone who is involved in the transaction. If you are connecting with a potential client take a look at their record and how their company is registered.

Go for a formal AML policy

Even the smallest company can establish anti-money laundering software solutions. The policy should have the instructions that should be taken or avoided. You may have to incorporate the procedures for cash handling and accounting. Having a policy established helps in direct decision-making regarding the deals and partnerships with others.

Make use of data analytics

Data analytics is one of the most important ways to combat money laundering. There will be a multi-factored pattern that occurs in a particular geographic location concerning products or the customer involved. With AML solutions for banks, the pattern in the area can be recognized and can be used to come up with client models. The pattern recognized can also be employed for categorizing the potential risks and adapting new alerts. The AML can see if there is any relation between negative news and the characteristics of the account. It can be a location or any other similarity.

What is anti-money laundering?

You have seen that AML should be used to prevent money laundering but what exactly is AML? Anti-money laundering refers to a set of rules, regulations, laws and practices aimed to prevent fraudsters from disguising money obtained illegally as legitimate income.


FinAMLOR from Finacus is end-to-end AML software solutions that enable a risk-based approach to monitor the behavior of customers for any suspected criminal activity. The software offers the industrial-best practice to monitor, review and protect your business.


  • Customer Due Diligence
  • Identification
  • Verification
  • Risk Scoring and Classification
  • Transaction Monitoring
  • Case Management

Bottom line

Finacus aims to technologically empower enterprises with a robust software solution. Keep fraudsters at bay with FinAMLOR. Experience its power with the help of a demo today.

AML Software- Protect Your Business from Financial Crime

Money laundering has been one of the most serious crimes that have a humongous impact on the business. Money laundering is not something reserved just for the big screen. According to a survey, the annual global money laundering transactions account for about $1 trillion to $2 trillion which is 2% to 5% of global GDP. The common target for money laundering is small businesses. Increasing money laundering can be kept at bay with the help of the best Anti-money laundering software. The anti-money laundering software offers the users a shield of security to keep the money safe.

anti money laundering solution

What is money laundering?

Money laundering is the generation of large amounts of money through various criminal activities from legitimate sources. In simple words, money laundering is the process of taking dirty money and cleaning it. Money laundering is done by three major steps which are placement, layering, and integration.

  • Placement is the step where the dirty money is put into legitimate financial systems such as a bank.
  • Layering is the step in which the source of the money is concealed through various transactions and bookkeeping tricks.
  • Integration is the withdrawal of laundered money and normal usage.

Money laundering is a risky job that earns up to $500,000 of fine or double the property or imprisonment for about 20years.

What is anti-money laundering?

Anti-money laundering is a set of laws, regulations, and procedures that is designed to prevent people and deter people from hiding illegal money as a legitimate income. It is in the hands of the financial institution to monitor the deposits of the customers and ensure that it is not a part of any laundering scheme. Unfortunately, the laws of AML are slow to catch up to the cybercrimes as most of the laws are designed to detect dirty money as it enters the traditional banking systems. Establishing a robust AML transaction monitoring software helps in identifying dirty money way earlier and not just through the traditional system. Let us see how AML software helps to identify and avoid money laundering.

  • Enhanced due diligence: The AI-driven software automates the enhanced due diligence process. The steps are taken by providing a clear cut idea about the people with whom you are dealing, understanding, and monitoring all their activities in various transactions, and accessing the risk of money laundering.
  • Reviews odd transaction patterns: In the case of money laundering, the launderers use several accounts to perform just small transactions which will easily surpass without getting caught. This pattern might miss the human eye but automated AML software solutions can identify the smaller transactions and unveil any pattern that is an effect of illegal activity.
  • Identification of the politically exposed persons (PEPs): Compliance for PEPs is mandatory for financial firms. This is essential to identify the risk that is associated with your customers. If a person is holding a public office or a function then he is a politically exposed person. If you want to do business with such an entity, you have to perform due diligence and monitor the ongoing transactional activities.

Money laundering is extremely serious for small businesses. It will expose you to hefty fines and imprisonment.

Bottom line

The financial sectors should consult the best anti-money laundering solution providers and install robust AML software in place to make sure that the transactions made don’t involve dirty money.