Jurisdiction(s):
United Kingdom

Key definition

Due diligence definition

What does Due diligence mean? In legal practice, due diligence describes (1) compliance steps to prevent offences; and (2) pre‑transaction investigation in corporate and finance work. As a statutory defence to many strict‑liability and regulatory offences (for example under the UK Consumer Protection from Unfair Trading Regulations 2008 and the Food Safety Act 1990, and under Ireland’s Consumer Protection Act 2007 and food legislation), it requires the defendant to show that all reasonable precautions were taken and all due diligence was exercised to avoid the commission of the offence. Depending on the statute, this may place a legal or evidential burden on the defendant,...

Enhanced Due Diligence under the UK MLRs 2017: checklist for financial services covering HRTCs, correspondent and crypto relationships, complex transactions, ongoing monitoring, de-risking, sanctions, FCA/JMLSG guidance and enforcement

Published by a LexisNexis Financial Services expert

Practice notes

This Checklist supports those Advising financial services firms on meeting the UK’s anti-Money laundering (AML), counter-terrorist financing (CTF), and countering proliferation financing (CPF) legal and regulatory obligations. It sits within a wider series covering customer Due diligence (CDD)-often described as ‘know your customer’ or ‘KYC’-as required by the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, SI 2017/692 (MLRs), alongside guidance issued by the Financial Conduct Authority (FCA) and the Joint Money Laundering Steering Group (JMLSG). This Checklist concentrates on the application of enhanced customer due diligence (EDD), both for general higher risk scenarios and for specified circumstances involving unusual transactions, high-risk third countries, and correspondent relationships. For applying EDD to politically exposed persons, see: AML/CTF checklist-politically exposed persons (PEPs) for financial services firms. For further CDD-related checklists, see: Anti-money laundering and counter-terrorist financing (AML/CTF)-overview...

What is enhanced due diligence (EDD)?

The majority of firms within scope of the MLRs must perform CDD; EDD is a component of that obligation. CDD measures include identifying a customer or beneficial owner and verifying their identity...

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Web page updated on 28/05/2026

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