21 APR 2021

Our new Client Risk Assessment process

Following changes made to the Isle of Man Anti Money Laundering and Countering of Terrorism Code, we have changed and simplified the way we carry out our client money laundering and terrorist financing risk assessments. These changes came into force on 19 April 2021.

Our previous risk assessment

Our previous risk assessment process had been in place for a number of years and was based on: 

• Client jurisdiction; and
• Investment value

Why are we changing?

We take a risk-based approach which means applying a realistic assessment of the money laundering and terrorist financing threats associated with the services we provide. Greater focus is now placed on our higher risk clients, where: 

• They reside in a jurisdiction that may pose an increased risk of money laundering or terrorist financing
• They are investing an amount that is above the investment thresholds set by Ardan
• They are defined as a Politically Exposed Person (PEP)

What has changed?

Our new risk assessment process is now based on: 

• Client jurisdictions;
• Investment value; and
• Applicant type

Each jurisdiction has been categorised according to their level of compliance with international regulatory standards. There are 3 risk categories; 

• Standard
• Higher
• High

Standard risk business:

A client will be categorised as posing a standard risk if they are applying for a portfolio and are: 

• Both resident in a standard risk country and sending their payment from a standard risk country
• An expatriate resident in the United Arab Emirates and are both a national of a standard risk country and sending their payment from a standard risk country or a bank account in the United Arab Emirates
• A regulated trust/pension company

For standard risk business, no documentary evidence of source of funds is required1

Higher risk business

A client will be categorised as posing a higher risk if they: 

• Are Applying for a portfolio and the premium is in excess of the investment thresholds set out in the source of funds procedures and they are either resident or sending their payment from a higher risk country. A list of all the higher risk countries is shown in the attached Guidelines document.
• Do not meet the definition of a standard risk client.

Documentary evidence of source of funds* must be supplied for higher risk business 

High risk business

All Politically Exposed Persons (PEPs) are categorised as high risk. Where the client poses a high risk, source of wealth information must also be supplied which means providing information on the entire body of wealth, including the total assets of the customer, such as: 

• Annual income, including the source of income, for the last 3 years
• Details of all investments and savings, including where the investments/savings are held, balances, and how the savings were accumulated
• Details of all fixed property held, including the address of each property, value and how the property was acquired
• Details of any other significant assets the customer holds, including the type of asset, value and how the asset was acquired

Please note some countries may not appear within our tables. In these circumstances please contact sales@ardan-international.com for guidance.

Terminology changes - Source of Funds/Source of Wealth

*Source of Funds now refers to both the activity that generated the funds they are investing with us, as well as the means through which the funds have been transferred. **Source of Wealth now refers to the ‘’Origin of a customer’s entire body of wealth and includes the total assets of the customer’’. 1We reserve the right to request further documentary evidence at any time. Whilst we have created a new source of funds procedure that reflects these changes, some of our existing literature, including application forms, have not yet been updated but will be in due course.