Why does Firstrade conduct Enhanced Due Diligence (EDD)?

Regulated firms are required to take a risk-based approach to customer due diligence and ongoing monitoring under the Anti-Money Laundering. Firms should conduct enhanced due diligence (EDD) and enhanced ongoing monitoring in higher-risk situations.

Enhanced due diligence (EDD) is the know your customer (KYC) process of gathering data and information to verify the identity of a client or customer and to obtain explanation of unusual account activities detected. The Red Flags are included:

• Overly secretive clients; excessive changes of person contact information

• Potential of Politically Exposed Person (PEP); possible Specially Designated Nationals (SDN) matched

• Questionable source of funds; unreasonable funds transfers

• Concentrate trading on low-priced securities, illiquid stock/option trading, possible of insider trading

Under our AML program, the Risk-based procedures for customer due diligence that include understanding the nature and purpose of customer relationships and conducting ongoing monitoring to identify and report suspicious transactions, while maintaining and updating customer information, including the contact, financial, employment and investment profile information, and any beneficial owners of accounts.

Therefore, we may conduct EDD and ask you to provide various identification documents or other information. Until you provide the information or documents required, we may not be able to open an account, process any transactions for you, or provide other products or services to you.

Firstrade Anti-Money Laundering Monitoring & Requirements Disclosure