Enhanced due diligence (EDD) is a higher-rigour version of standard CDD. The Rules mandate EDD in four scenarios; mature programs typically add risk-based triggers on top.
The four mandatory triggers
- The customer is a foreign PEP, or a family member or close associate of one.
- The customer is from or located in a jurisdiction the FATF identifies as having strategic deficiencies.
- The customer or transaction matches a typology AUSTRAC has flagged.
- Standard CDD is inconclusive or has produced inconsistent information.
Practical add-on triggers
- Cash deposits or high-value cash transactions above the firm's risk threshold.
- Complex ownership structures with three or more layers of corporate vehicles.
- Reluctance from the customer to provide standard ID or rationale for the transaction.
- Material change in the customer's profile or transaction patterns.