GlossaryEN1 min readUpdated: Jun 26, 2026
Enhanced Due Diligence
Elevated risk signals – a customer from a high-risk jurisdiction, an unusual payment structure, or an unidentifiable beneficial owner – call for Enhanced Due Diligence (EDD): a deeper screening and monitoring process that goes beyond standard Customer Due Diligence (CDD).
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Source: https://www.investopedia.com/terms/e/enhanced-due-diligence.asp
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Elevated risk signals – a customer from a high-risk jurisdiction, an unusual payment structure, or an unidentifiable beneficial owner – call for Enhanced Due Diligence (EDD): a deeper screening and monitoring process that goes beyond standard Customer Due Diligence (CDD). In logistics and trade finance, EDD applies to high-risk business partners, transactions in sensitive regions, and suspicious cargo flows. The process involves in-depth investigation into business models, sources of funds, and ultimate beneficial ownership, alongside continuous transaction monitoring. Freight forwarders and financial intermediaries are legally required to apply EDD in many jurisdictions when standard KYC measures fall short – for example, in dealings with politically exposed persons (PEPs) or counterparties linked to sanctions lists. EDD is distinct from Simplified Due Diligence (SDD): it demands a documented risk decision and a heightened internal escalation level.
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