Enhanced Due diligence is a critical process for any business that wants to make informed decisions and manage risks effectively. By conducting thorough due diligence checks, businesses can identify potential risks and take necessary steps to mitigate them.
With 40 years of investigative experience, here we outline the services that an enhanced due diligence company should provide to help businesses manage risks more effectively.
Third-Party Due Diligence
Third-party entities such as suppliers and partners can pose significant risks to a business. By conducting comprehensive risk assessments and due diligence checks, the experienced team can evaluate the financial stability, reputation, and compliance history of third-party entities across categories such as ethics, compliance, legal, ESG, and more.
Know Your Customer (KYC)
To comply with KYC regulations, financial institutions must verify the identity of their clients, assess their suitability, and monitor their activity. Therefore, a due diligence company should provide a KYC service that provides accurate and up-to-date information on clients. The experienced team can verify identities, assess creditworthiness, and monitor activity to ensure compliance with regulatory requirements. They can also help businesses develop and implement effective KYC policies and procedures.
Anti-Money Laundering (AML)
AML regulations require financial institutions to implement procedures to detect and prevent money laundering activities. A due diligence provider should provide an AML service that can help businesses achieve compliance by providing comprehensive risk assessments, identifying potential money laundering activities, and recommending appropriate controls.
Politically Exposed Person (PEP)
PEP checks are essential for identifying individuals who may pose a higher risk due to their political exposure. A due diligence company should provide a PEP service that can help businesses identify and mitigate these risks by conducting thorough checks on individuals and their associated entities. They can also provide ongoing monitoring to ensure compliance with regulatory requirements.
Risk profiling is essential for managing risks effectively and understanding a business’s risk appetite. Therefore, a due diligence company should provide a risk profiling service that can help businesses identify and assess the risks associated with their operations and develop effective risk management strategies. The experienced team can analyse data, identify potential risks, and provide recommendations on risk management strategies and controls.
In conducting due diligence checks, at FACT, a leading UK provider of enhanced due diligence services, we focus on areas such as reputation and character, financial stability, and business operations. Investigating the subject’s reputation, background, and affiliations can help identify any potential reputational risks or red flags. Analysing the subject’s financial statements, credit history, and other financial data can help assess their financial health and identify any potential financial risks or vulnerabilities. Investigating the subject’s business operations, including their supply chain, production processes, and customer base, can help assess the quality and sustainability of their business model.
In conclusion, a due diligence company should provide a comprehensive suite of enhanced due diligence services that can help businesses identify and mitigate risks associated with third-party entities, customers, and other stakeholders. With experienced teams that conduct comprehensive risk assessments and due diligence checks, businesses can make informed decisions and take necessary steps to mitigate risks.