CDD/EDD
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R E G U L A T O R Y C O M P L I A N C E
Enabling Technologies for Financial Services
AMLInfo a CubeIQ Limited Division
Welcome to AMLInfo Web Site for Regulatory Compliance Technology - AML & Compliance Products and Services.
>> Customer Due Diligent & Enhanced Due Diligent (CDD/EDD)
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Enhased Due Dilligent: PCS™ CDD/EDD Reporter™
EDD Reporter™ provides enhanced due diligence for “Know Your Customer - KYC” and Customer Identification Programs required by the USA Patriot Act, with a specific emphasis on Section 326 of the Act and by EU regulations. EDD Reporter™ provides a comprehensive solution to managing the customer account opening and account maintenance process, along with the risk-based modeling for AML risk.
Highlights:
1. Uses risk weighted scoring based on individual criteria and configurable risk models.2. Risk factors and scores are used to categorize customers into risk classes.3. Customer acceptance models enable an organization to identify and track customer identification, verification and documentation
requirements.
4. Ability to link to company wide acceptance documentation requirements such as an account opening forms and financial statements.5. Ability to store imaged files of customer verification documentation.6. Electronic links to identity verification companies dynamically, and as a component of the customer acceptance process.7. Security rights and controls are customizable and enterprise-wide.
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Customer Risk & Acceptance Models
The core of any system responsible for implementing an enhanced “Know Your Customer” policy is a well-designed customer database to accurately reflect customer and account relationships. EDD Reporter™ provides the tools to model customers through the use of two critical methods:
Customer Risk Models - used to evaluate existing customers
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Risk Models
Customer risk models within EDD Reporter™ are configurable models used by a financial services institution to categorize customers into risk classes for the purpose of managing customer compliance risk. Sample evaluation criteria are listed below:
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Risk Factor Items
Risk Factor Items within EDD Reporter™ are configurable individual elements used in the creation of a customer risk model. Risk Factor Items identify the individual elements that your organization deems appropriate in assessing customer compliance risk. Individual risk factors are created to form a list of all potential risk factors, and then individual factors are selected as appropriate for use in Risk Models.
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Risk Scores
Calculating the weighted average of all the individual risk factor items in a risk model results in a risk score. The final risk score is then analyzed with the Risk Classifications established within Prime Compliance Suite™ to determine in which risk class a customer belongs.
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Customer Types
Customer types within EDD Reporter™ are categories of customers to which Risk Models and Customer Acceptance Models are assigned. Customers are linked to a customer type to determine the appropriate Risk and Acceptance Models.
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Risk Classes
Customers may be categorized into risk-assessed groups called Risk Classes. Risk Classes may be used to associate different rules and tolerances when evaluating transactions for suspicious activity. Risk classes can be developed to represent a simple high, medium, or low rating or can match elaborate categorizations established by compliance policy. Risk classes are defined by high and low parameters to support the Risk Scores functions of EDD Reporter™.
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Customer Acceptance
Customer acceptance models within EDD Reporter™ provide the functionality to manage the processing required to accept a new customer.
This functionality enables you to identify and track customer identification, verification and documentation requirements as necessary based on the policies and procedures of your organization. This customer acceptance functionality is available in the form of customer acceptance lists, or checklists, and these checklists indicate all of the tasks and documentation required to accept a category of customers.
A list of all customer acceptance items required by your organization is maintained, and individual customer acceptance items are included as appropriate in the Customer Acceptance Model.
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Customer Documentation
EDD Reporter™ provides the functionality to track customer documentation, and to store electronic documents with the customer records. Electronic images of customer opening forms, applications, copies of identification documents such as passports and motor vehicle identification may be stored and linked with the customer information for display while using EDD Reporter™. Credit Reports and copies of background checks are other popular documents stored on line in EDD Reporter™.
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Security and Audit Trails
A separate security system is used to control all access to the functions in EDD Reporter™. This is true for the entire suite of Prime Compliance Suite™ software components. A security manager with appropriate rights can create operators and assign processing rights as appropriate to meet the security and separation of duty requirements of an organization.
Rights issued to an operator also specify a “Scope”. Scope allows the security manager to determine precisely which records an operator is allowed to access. Access can be restricted to specific branches, departments within a branch, as well as to records owned by a particular operator.
Attempted program access, both failed and successful, is recorded to the security database. Additionally, all processing performed within EDD Reporter™ is recorded to an Events log. Events can be reported in multiple ways and are displayed for both the entire system as well as for specific records.
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Customer Identity Verification
EDD Reporter’s™ ID Verification (IDV), were available, provides the functionality to easily manage the process of verifying the identity of customers within an institution. This functionality can be utilized as part of the customer acceptance process, as well as on an on-demand basis.
IDV enables you to identify customers either manually or automatically, and whether or not they have been imported into Prime’s EDD Reporter’s™ and BSA Reporter’s™ modules. User-defined Customer Acceptance Models are used to determine whether IDV checks should be performed on types of customers, and how often.
IDV consists of two components: functionality that is part of Prime Compliance Suite™ (client and server), and an IDV service, responsible for carrying out clients’ requests. This service can run on the same machine as Prime Compliance Suite™, or any other server that can access service providers. IDV-related nodes appear under Enhanced Due Diligence node.
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