AML compliance for small investment firms – how granular does it get?

asked by u/ishaan59 · 18d · 1 answers

Starting to get my head around AML requirements, and while the big picture makes sense, I'm a bit lost on the practical application for smaller shops. For a firm handling, say, under $50M AUM and not dealing with super-high-risk clients, how deep do you really need to go on enhanced due diligence for every new account? Is there a common sense threshold, or is it a 'paint by numbers' approach regardless of scale?

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  • u/altcoin_aly· 1 pts· 18d

    It's definitely not a paint-by-numbers approach, especially for smaller firms where resources are tighter. The key is a robust, risk-based approach; you don't necessarily need enhanced due diligence for every new account, but your initial CDD needs to be thorough enough to identify red flags that would then trigger EDD. It comes down to a well-documented risk assessment process.

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