Risk-Based Approach

32. Any inadequacy of "Know Your Customer" standards can expose Relevant Persons to serious business operation and control risks.
33. In complying with Rule 8.3.1(1)(a), a Relevant Person should adopt an RBA for the Customer identification and verification process. Depending on the money laundering risk assessment regarding the Relevant Person's Customer, the Relevant Person should decide to what level of detail the Customer identification and verification process will need to be performed. The risk assessment regarding a Customer should be recorded in the Customer file.
34. The RBA does not release a Relevant Person from its overall obligation to identify fully and obtain evidence of Customer identification to the Regulator's satisfaction.
35. A Relevant Person is advised that in cases of doubt it should adopt a stricter rather than a moderate approach in its judgement concerning the risk level and the level of detail to which Customer identification is performed and evidence obtained.