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Client onboarding and AML
Client onboarding and workflow
Learning Outcome
5
Understand the importance of continuous monitoring.
4
Identify client risk categories.
3
Understand CDD and AML compliance.
2
Explain key account-opening steps.
1
Understand the purpose of client onboarding.
Account Opening Steps
Opening a new client account is the first stage of onboarding, and it follows a defined sequence designed to capture, verify, and activate the client's relationship with the institution.
Customer Due Diligence
Customer Due Diligence is the process of verifying a client's identity and understanding the nature of their business or investment activity, as mandated under the PMLA, 2002 and SEBI's KYC guidelines. It is not a one-time check; it continues for as long as the client relationship lasts.
Risk Assessment Process
Every client is assigned a risk category at onboarding, which determines the intensity of due diligence applied and how frequently their KYC details must be refreshed.
Risk assessment does not end at onboarding. Institutions continuously monitor client transactions, and any activity inconsistent with the client's declared profile can trigger a Suspicious Transaction Report (STR) filed with the Financial Intelligence Unit-India (FIU-IND).
Summary
5
Monitor transactions for AML compliance.
4
Classify client risk level.
3
Conduct CDD and ongoing monitoring.
2
Collect documents and activate account.
1
Verify identity and assess risk.
Quiz
Which of the following is a key component of Customer Due Diligence (CDD)?
A. Dividend distribution
B. Portfolio valuation
C. Identity verification
D. Settlement reconciliation
Quiz-Answer
Which of the following is a key component of Customer Due Diligence (CDD)?
A. Dividend distribution
B. Portfolio valuation
C. Identity verification
D. Settlement reconciliation
IB11 - Fixed Income Portfolio Strategy : Client onboarding and workflow
By Content ITV
