EDD (Enhanced Due Diligence)

Enhanced Due Diligence is what Customer Due Diligence (see CDD) becomes when a risk assessment flags a particular customer or relationship as higher-risk than the baseline, it's the same four-part CDD obligation (identify, verify, understand, monitor), done with more scrutiny and more frequency, plus a handful of concrete steps standard CDD doesn't require at all.

A relationship typically gets routed into EDD for reasons like: the customer is a Politically Exposed Person (see PEP) or closely connected to one; the customer or the transaction touches a jurisdiction FATF or the relevant regulator has flagged as high-risk; the ownership or control structure behind the customer is unusually complex or opaque (see UBO); or a transaction is unusually large, unusually complex, or has no clear legitimate economic purpose given what's known about the customer.

Once a relationship is in EDD, the concrete measures typically added on top of standard CDD include: establishing source of wealth and source of funds (see that entry), not just what documents prove a specific deposit's origin, but where the customer's overall wealth came from; obtaining senior management approval before opening or continuing the relationship, rather than leaving the decision to a front-line analyst; and running more frequent, more intensive ongoing monitoring than a standard-risk account gets. The point of all of it is the same: a check calibrated to actual risk, not a fixed check applied regardless of how risky the relationship turns out to be.

Who actually built this

FATF Recommendation 10's interpretive note sets the general EDD requirement; Recommendation 12 adds the specific PEP trigger. The EU's Fifth Anti-Money Laundering Directive (and its successor AMLR) names concrete EDD triggers, including a formal list of high-risk third countries EDD must apply to. Türkiye's MASAK carries the same obligation through its own risk-based-approach regulation. None of it is Solidus's design.

Solidus today

Solidus has not built any part of EDD. There is no risk-scoring engine to route a customer into EDD in the first place, no workflow to collect and substantiate source of wealth or source of funds, no senior-management-approval step, and no enhanced ongoing-monitoring capability. This is a deeper, unstarted gap than CDD itself, which at least has an identification input Solidus Verify supplies today, EDD has none.

See also

CDD is the baseline obligation EDD escalates from. PEP and Source of Wealth / Source of Funds are two of EDD's most concrete requirements. UBO, an unusually complex ownership structure, is one of the risk factors that triggers it. AML is the umbrella program EDD sits inside.