Under AML/CTF requirements, which of the following customer identification procedures is NOT required when establishing a business relationship with a new client?
Correct Answer
C) Obtaining the client's credit report from a credit reporting agency
While AML/CTF requires identity verification, enhanced due diligence for high-risk clients, and record keeping, obtaining credit reports is not a mandatory requirement under the AML/CTF Act. Credit checks may be conducted for other business purposes but are not part of the standard AML compliance procedures.
Why This Is the Correct Answer
The AML/CTF rules require identity verification, enhanced due diligence for high-risk customers such as foreign politically exposed persons, and record-keeping. They do not require a credit report, which assesses creditworthiness rather than money laundering risk.
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