Module: General Practice
Q96: Customer Due Diligence (CDD) involves risk categorization and identifying beneficial ownership. Which of the following statements accurately reflect the current RBI norms?
For periodic updation of KYC (Re-KYC), the standard timelines are every 2 years for High-Risk customers, every 8 years for Medium-Risk, and every 10 years for Low-Risk customers.
A Foreign Diplomat or a Politically Exposed Person (PEP) is automatically classified as "High Risk," requiring Senior Management approval for account opening and establishing the source of funds.
To identify the "Beneficial Owner" (BO) of a legal entity, the controlling ownership threshold is currently set at 10 percent of shares, capital, or profits for Companies, Partnership Firms, and Trusts.
Salaried employees receiving funds from known government or corporate sources are typically classified as "High Risk" due to the volume of monthly transactions.
A Foreign Diplomat or a Politically Exposed Person (PEP) is automatically classified as "High Risk," requiring Senior Management approval for account opening and establishing the source of funds.
To identify the "Beneficial Owner" (BO) of a legal entity, the controlling ownership threshold is currently set at 10 percent of shares, capital, or profits for Companies, Partnership Firms, and Trusts.
Salaried employees receiving funds from known government or corporate sources are typically classified as "High Risk" due to the volume of monthly transactions.
✅ Correct Answer: B
The correct answer is Option B. Re-KYC is 2-8-10 years.
PEPs are high risk.
BO threshold is 10%. Salaried employees are low risk, making statement 4 incorrect.
Risk and BO concepts are central to the IIBF AML KYC Exam 2026.
PEPs are high risk.
BO threshold is 10%. Salaried employees are low risk, making statement 4 incorrect.
Risk and BO concepts are central to the IIBF AML KYC Exam 2026.