High-Risk Third Country
A High-Risk Third Country is a jurisdiction listed in Schedule 3ZA of MLR 2017 — or identified by FATF as having strategic deficiencies in its AML/CTF regime — that triggers mandatory Enhanced Due Diligence. Under MLR 2017 Regulation 33(1)(b), any business relationship or transaction with a client established in or connected to a high-risk third country requires EDD as a matter of law, not discretion.
check the current Schedule 3ZA list (it diverges from the EU list since 2021) when assessing geographic risk in client onboarding. Connection includes residence, registration, operations, and significant transactions — not just nationality.
Other terms that go with High-Risk Third Country
Enhanced Due Diligence is a more thorough level of client verification required when a relationship presents a higher risk of money laundering or terrorist financing. EDD steps typically include verifying the source of funds, establishing source of wealth, obtaining senior management approval before onboarding, and applying more frequent ongoing monitoring.
In AML, risk assessment operates at two levels. A firm-wide risk assessment identifies the overall money laundering risks facing a practice — covering client types, services offered, geographies, delivery channels, and funding sources. A client risk assessment scores an individual client as low, medium, or high risk and determines what level of due diligence to apply.
Sanctions screening is the process of checking clients, their beneficial owners, and associated parties against official sanctions lists maintained by bodies such as the UK Office of Financial Sanctions Implementation (OFSI), the United Nations Security Council, the European Union, and the US Office of Foreign Assets Control (OFAC). Acting for a sanctioned individual or entity is a criminal offence.
Put High-Risk Third Country into practice with Certivus
Knowing the term is the first step. Certivus gives you the workflows — client intake, CDD, EDD, PEP and sanctions screening, audit-ready records — to apply it across every client.
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