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  • Writer's pictureAnna Stylianou

6 steps to identify high risk ML/TF areas associated with your clients

Updated: Jul 13, 2023





Regulated entities need to be diligent in identifying and managing money laundering and terrorist financing (ML/TF) risks associated with their clients.


In order to do so, they should pay particular attention to the following high-risk areas:


1️. Conducting regular sanctions and adverse media checks on all clients to screen for any potential red flags.


2️. Identifying clients who are Politically Exposed Persons (PEPs), who may be at a higher risk for engaging in corrupt activities.


3️. Identifying clients with connections to high-risk countries, which are more likely to be associated with illicit financial activity.


4️. Identifying complex and unusually large transactions that may indicate money laundering or other criminal activity.


5️. Scrutinizing any transactions that don't align with the customer's economic profile, as these may indicate suspicious activity.


6️. Identify clients with links in industries that are associated with high corruption and ML/TF risk


It's important to conduct these measures during onboarding and throughout the business relationship to ensure that ML/TF risks remain at an acceptable level and within the entity's risk appetite.


By staying vigilant and identifying potential risks early on, regulated entities can help prevent illicit activity and protect their reputation.

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