Benefits of an Effective CDD Program and How Risk Scoring Customer Accounts Can Protect the Reputation of Your Institution

Douglas J. Bruggeman, CAMS-FCI

The following white paper, Benefits of an Effective CDD Program and How Risk Scoring Customer Accounts Can Protect the Reputation of Your Institution, is intended to show the importance of a formal customer due diligence (CDD) program and how it must be designed to conform to current securities industry regulations pertaining to policies, procedures and processes. In addition to discussing a formal CDD program, this white paper will also discuss risk scoring a customer, including general risk scoring policies, procedures and processes.

Specifically, this paper will provide important guidance and information on how you can protect the reputation of securities firms and other financial institutions through discussions on the following topics:

The history of CDD programs and risk scoring customers; the benefits of effective CDD programs and risk scoring customers; how CDD programs and risk scoring works, including examples of effective CDD programs and risk scoring methods; problems associated with CDD programs and risk scoring customers; what and where to look for when considering solutions; and specific solutions and what actions your financial firm should consider implementing.

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