Latin America Due Diligence Risk Factors

Due diligence is a crucial component of a comprehensive compliance strategy which protects companies from the terrible consequences of financial crimes. It’s not without risk especially in areas like Latin America where unique dynamics require tailored strategies.

To minimize the risk to minimize the risks, you need to keep track of any changes in the factors that could affect the due diligence of your company. These can include changes in local regulations, economic trends or geopolitical events. Keeping up to date with these issues will ensure that your due diligence processes are up to the task.

If, for example you identify a person as a PEP (politically exposed person) it could be necessary to carry out additional due diligence. This typically involves checking additional documentation and verification methods to establish the source of their wealth as well as their funds as well as the identification of their ultimate beneficial owners (UBO) and analyzing their transactions patterns to find the possibility of money laundering or other illicit activities.

Depending on the risk, you may be able to conduct thorough reviews of their current business operations, including the nature and nature of any third-party partnerships. You might also wish to examine contractual obligations in order to determine if they pose an issue of non-compliance. You may also want to consider hiring an outside due diligence specialist to aid your review process. These services typically have access to more extensive databases, and may also provide assistance in conducting a thorough risk assessment.

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