The risk matrix is the most important living document for a compliance officer. Under the risk-based approach (RBA) promoted by FATF, companies must abandon generic control and move to stratified monitoring: allocating more resources to clients that represent a greater threat.
Essential components of the calculation:
The matrix assesses the likelihood of a money laundering event occurring against the impact it would have on the organization. To determine this, four key risk factors are analyzed:
Jurisdiction factor: Does the client operate in border areas or in countries with low regulation?
Client factor: Is it a PEP? Does their economic activity handle a lot of cash (e.g., casinos, jewelry stores)?
Product/service factor: Does the product allow for anonymous transfers or to third parties?
Channel factor: Is the relationship face-to-face or through non-presential digital platforms?
AgileCheck: real-time risk rating
With AgileCheck, the matrix stops being a static excel sheet and becomes a decision engine. When entering a client, a category (low, medium, or high) can be assigned immediately, triggering enhanced due diligence alerts when the risk exceeds the allowed threshold.