CDDCustomer Due Diligence
Identifying and verifying the customer and beneficial owner, understanding the relationship and conducting ongoing risk-based review.
What does it mean?
English expansion: Customer Due Diligence
Identifying and verifying the customer and beneficial owner, understanding the relationship and conducting ongoing risk-based review.
How is this concept used?
CDD asks who the customer is, who ultimately owns or controls the customer, and on whose behalf a transaction is conducted. It also examines the expected use of the service and reviews the relationship as relevant information changes. The depth of review should reflect the context and risk.
Documented examples
Documented example
TD Bank: CDD findings (2024)
On 10 October 2024, the U.S. OCC announced a corrective order and civil penalty against TD Bank, N.A. and TD Bank USA, N.A. Its findings included CDD and customer-risk-rating deficiencies, demonstrating CDD's role in assessing customer relationships.
Source publication: · Source checked:
Official record: U.S. Office of the Comptroller of the Currency
Documented example
Standard Chartered: ongoing review (2019)
On 9 April 2019, the UK's FCA announced a regulatory financial penalty against Standard Chartered for failings in UK correspondent banking and UAE branches. It specifically found shortcomings in customer due diligence and ongoing monitoring.
Source publication: · Source checked:
Connection to a wallet report
Wallet findings can support a review of transaction activity. They do not replace customer identification, ownership records or the explanation of a business relationship.
A common misconception
The person signing a form is not always the person who ultimately controls a company.
Related reading
Put the explanation in context
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