General Studies · Enhanced Due Diligence Case Study
A foreign entity registered in a tax haven (Cayman Islands) and owned by a trust whose beneficiary is a foreign judge (PEP) requests to open a corporate account with a 20 crore rupee deposit. The local representative asks to waive the Beneficial Owner identification for the judge. What is the mandatory regulatory course of action?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Process the onboarding through Non-Face-to-Face channels to legally bypass the personal identity verification of the overseas beneficiary.
- 2Categorize the account as medium risk because the local representative has a long-standing clean record with the bank.
- 3Treat the account as High Risk, perform Enhanced Due Diligence (EDD), and strictly deny any waiver of Beneficial Ownership verification for the PEP; file an STR if disclosures are withheld.✓
- 4Approve the account directly since the judge is a reputable public official and the transaction size is highly material.
Correct answer
Treat the account as High Risk, perform Enhanced Due Diligence (EDD), and strictly deny any waiver of Beneficial Ownership verification for the PEP; file an STR if disclosures are withheld.
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