ACCA Applied Skills · Corporate and Business Law (Global) · Fraudulent and criminal behaviour
Which of the following is an example of customer due diligence that a regulated firm must carry out before taking on a new client?
Verifying the client's identity using reliable independent documents is a customer due diligence step. Firms must also identify beneficial owners and understand the purpose of the relationship. Profit reports and fee deposits are commercial matters rather than anti-money laundering requirements.
- AVerifying the client's identity using reliable independent documentsCorrect
- BObtaining an audited report on the client's last three years of profits
- CRequiring the client to deposit funds equal to one year of fees
Explanation
Customer due diligence requires identifying and verifying the client's identity, and for companies the beneficial owners, using reliable independent sources. Profit history and fee deposits are commercial matters, not anti-money laundering requirements.
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