Risk Insight: Sports, Recreation and Entertainment Industry

By: Insurance Institute of Botswana (IIB)

On the 29th March 2021, the Insurance Institute of Botswana (IIB), held a virtual training for Customer Due Diligence (CDD). The training was facilitated by Non-Financial Banking Institution Regulatory Authority.

The primary focus of the training was to ensure that companies carry out effective Customer Due Diligence by following the right processes and understating what is required to take a risk based approach and the supporting documents that should be requested from clients.

Some of the topics that were covered include the following:

● Simplified Customer Due Diligence

It's a basic and minimal CDD process of identifying, verifying and ongoing monitoring of low risk business relationships and transactions.

● Enhanced Customer Due Diligence

A CDD process that provides a greater level of scrutiny / due diligence to mitigate the increased risk

● Risk based Approach

To identify, see, and understand financial crime, risks (vulnerabilities and threats) to which an entity or sector are exposed to, and take the appropriate mitigation measures in accordance with the level of risk.

What is customer due Diligence?

Customer due diligence is the process of obtaining and verifying identity and a range of other information which profiles a customer before or after establishing business relationship. Information to be documented may include identity, addresses, source of wealth and funds, and expected business or transactional activity.

CDD also involve continuous monitoring of business relationship incorporates The ongoing monitoring of a business relationship, including due diligence information obtained, to ensure it remains up to date and that the relationship is operating as expected for that customer.