What is a risk-based approach to problem solving?
A risk-based approach to problem-solving in Anti-Money Laundering (AML) compliance is dynamic and adaptable, unlike the traditional checkbox approach, which requires businesses and financial institutions to adhere to standardised AML requirements.
For instance, if an accountant is dealing with a customer belonging to a country with weak AML laws, the accountant shall adopt a risk-based approach by conducting Enhanced Due Diligence as opposed to a Standard Due Diligence for a customer belonging to a jurisdiction with strong AML laws.
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