Enhanced Due Diligence (EDD) is a deeper level of identity and background checking required for clients who present a higher risk of money laundering or financial crime. Workflow will indicate when EDD may be required based on the risk assessment you complete.
What EDD involves
Standard Customer Due Diligence (CDD) covers identity verification and basic risk rating. EDD goes further and may include:
Verifying the source of the client's funds
Verifying the source of the client's wealth
Obtaining additional identity documents
Conducting enhanced ongoing monitoring of the client relationship
When EDD is required
EDD is required when a client is assessed as high risk. Common triggers include:
The client is a Politically Exposed Person (PEP) or closely associated with one
The transaction value is unusually high relative to the client's apparent profile
The client is from a high-risk country or jurisdiction
The client structure is complex (e.g. a trust or company with multiple beneficial owners)
The risk assessment template scores the client as high risk
How Workflow indicates EDD is needed
If your risk assessment scores a client as high risk, Workflow will flag this in the case. You will need to complete EDD steps before marking the case as approved. All EDD steps are recorded in the case history and audit trail.
Where to record EDD evidence
Use the Documents section within the case to upload supporting materials (e.g. bank statements for source of funds, statutory declarations). Add notes in the Notes section to record your assessment and reasoning.
This article provides general guidance only and is not legal advice. For advice specific to your circumstances, contact AUSTRAC or your legal adviser.
Related articles
How is risk automatically calculated in Workflow?
When is source of funds or source of wealth documentation required?
What is a PEP flag and what do I do if my client gets one?