A customer risk rating is reached by weighing the risk factors set out in the Executive Regulations against what the firm learns during customer due diligence. Firms typically consider the customer type and ownership structure, the countries involved, the products and channels used, and whether the customer or a beneficial owner is a politically exposed person. Screening and adverse media results feed into the picture.
The rating then drives the level of diligence. Higher-risk customers require enhanced due diligence, including source-of-funds checks, senior management approval and more frequent monitoring. Where genuinely low risk is identified and the supervisor permits it, simplified measures may apply. The rating is not fixed and should be revisited as the relationship and the firm’s risk understanding change.
Legal Reference (UAE):
· Cabinet Resolution No. 134 of 2025 (Executive Regulations), Article 5: determines the level of risk and the mitigation measures, including enhanced and simplified due diligence.
· Federal Decree-Law No. 10 of 2025, Article 19(1)(b): CDD scope is set by the risk dimensions and the outcomes of the national risk assessment.
For more details, consult the full text of the Executive Regulations or seek guidance from your AML compliance officer.