EDD: Enhanced Due Diligence

Enhanced Due Diligence (EDD) refers to additional verification measures applied to higher-risk customers, transactions, or jurisdictions where standard CDD is insufficient.

When EDD Is Required

Customer Triggers

• PEP (Politically Exposed Person) status
• Complex or opaque ownership structures
• Adverse media or screening hits
• Cash-intensive business models
• Unusual transaction patterns

Geographic Triggers

• FATF grey-listed or black-listed jurisdictions
• Countries subject to sanctions
• High-corruption jurisdictions
• Tax havens and secrecy jurisdictions

Product/Transaction Triggers

• Private banking relationships
• Correspondent banking
• High-value or unusual transactions

EDD Measures

Source of Funds: Where does money for specific transactions come from?

Source of Wealth: How did the customer accumulate their wealth?

Deeper Ownership Investigation: Trace through all layers to natural persons

Senior Management Approval: Executive sign-off on high-risk relationships

Increased Monitoring: More frequent and intensive transaction review

Additional Documentation: More extensive record requirements

EDD in Practice

EDD isn't optional when risk indicators are present—regulations require proportionate measures. The risk-based approach means organizations must define clear EDD triggers and document the additional measures applied.

See Enhanced Due Diligence for implementation details.

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Related: CDD | SDD | PEP