Exam ICWIM Topic 1 Question 50 Discussion

Actual exam question for CISI's ICWIM exam
Question #: 50
Topic #: 1
A firm has an existing client who is the head of a foreign state. What type of due diligence should the firm undertake if the client's spouse applies to become a client?

Suggested Answer: C Vote an answer

A client who is the spouse of the head of a foreign state is classified as aPolitically Exposed Person (PEP).
Firms are required to undertakeenhanced due diligence (EDD)for PEPs and their immediate family members due to the increased risk of corruption, money laundering, or misuse of public funds.
* Simplified (A): This applies to low-risk clients, not PEPs.
* Standard (B): Standard due diligence is insufficient for PEPs or their relatives.
* Additional (D): This term is not a formal category under anti-money laundering (AML) regulations.
References:
* International Certificate in Wealth & Investment Management: AML procedures and the treatment of PEPs.
* FATF (Financial Action Task Force) guidelines on enhanced due diligence for politically exposed persons.

by Ada at Feb 14, 2025, 03:44 AM

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