Due diligence is a critical element of a comprehensive compliance go to this site plan that safeguards businesses from the devastating consequences of financial crimes. But it’s not without its risks, especially in areas such as Latin America, where unique dynamics demand tailored strategies.
To reduce the risk To reduce the risk, it is vital to keep track of the changes in the environment that could impact the due diligence process of a company. These may include changes in local regulations, economic trends, or geopolitical events. These factors can aid in ensuring that your due-diligence procedures are up-to-date.
If, for instance you identify a person as a PEP (politically exposed person), it may be necessary to conduct additional due diligence. This typically involves examining further documents and confirming methods to establish the source of their wealth and funds. It also involves identifying the ultimate beneficial owner (UBO) as well as studying their transaction patterns to identify money laundering and illegal activities.
Based on the risk, you might be able to conduct thorough checks of their current business operations, including the type and nature of any third-party relationships. You might also wish to examine contractual commitments in order to determine whether they could pose a risk of non-compliance. Additionally, you may be interested in involving an expert third-party due to diligence service to support your own review procedures. These services can often provide access to more extensive databases and expertise in conducting an extensive risk assessment.