“Is the person who he claims to
be?” old fashion due diligence
may give the correct answer!
Neapolis University, Cyprus
Purpose – This paper aims to critically examine the impact of the evolution of technology regarding
customer due diligence (CDD) measures and highlight potential weaknesses in the areas of business
emerged from third parties, politically exposed persons and international clients. The paper explores
whether the use of old-fashioned CDD measures can aid relevant professionals to examine whether the
(potential) client is who he claims to be.
Design/methodology/approach – The paper is focused primarily on the use of important
evaluation reports, in Cyprus and the UK, to identify potential aws regarding CDD measures and the
legal framework in ghting economic crime. Interviews from professionals were carried out to provide
rst-hand experience on relevant issues.
Findings – The view, that nowadays due to the evolution of technology, CDD is more efcient than
ever, is based on solid ground. However, taking in consideration relevant reviews and reports, the paper
concludes that there are signicant problems and difculties in gathering and assessing client’s
information. Therefore, the use of old-fashioned due diligence measures, in appropriate circumstances,
might provide a more adequate investigation for high-risk customers.
Practical implications – The paper, in contrast with a professional’s recorded opinions, uses high
prole reports to prove that there is a loophole in current legal framework relating to CDD measures.
Originality/value – The paper uses two important reports from Cyprus and the UK to prove the
weaknesses of current application of CDD measures. The analysis provided in the paper can be used to
persuade professionals that there is space for the use of old-fashioned CDD.
Keywords Economic crime, Cyprus, Money laundering, Due diligence
Paper type Research paper
The ght against economic crime – united we stand!
The ght against economic crime continues to intensify signicantly in recent years,
and the governments around the globe seem more willingly than ever to cooperate and
devote resources in dealing with evolving corruption. Of course, it is acknowledged that
despite the fact that there is a continued recognition of the importance of anti-money
laundering (AML), as a result of the nancial crisis, many professionals and especially
banking leaders have been focused on capital, liquidity and credit issues and possibly
the survival of their institutions (KPMG, 2011).
It is clear that the global nancial crisis uncovered deciencies of the nancial
system that can not only be attributed to the failure and inadequacy of banks’ ofcials
(Tomasic and Akinbami, 2011). It would be dangerous to consider otherwise, as
measures taken will not target all possible causes.
There are not many examples where cooperation and coordination between so many
countries and organisations has been achieved. The failure to prevent economic crime or
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Journalof Money Laundering
Vol.19 No. 1, 2016
©Emerald Group Publishing Limited