What is a customer's economic profile?
The record of how a customer is expected to use a firm's services, what goes into it, and why ongoing monitoring depends on it.
By the ExamPass CY editorial teamLast reviewed 3 min read
Topic 6 of 14 · all topics in this chapter
- 1When CDD is required
- 2What CDD involves
- 3When CDD must be completed
- 4Verifying individuals
- 5Verifying companies and organisations
- 6Customer economic profile
- 7Beneficial ownership registers
- 8Simplified due diligence
- 9Enhanced due diligence and PEPs
- 10CDD by sector
- 11Ongoing monitoring
- 12Reliance on third parties
- 13Group-wide AML policies
- 14Prohibited practices and data use
Short answer
The economic profile is the firm's record of what normal activity should look like for a customer: why the relationship exists, the expected account turnover and type of transactions, where incoming funds should come from and where outgoing payments should go, and the customer's wealth, income and main business. It is kept in a dedicated form in the customer's file and updated whenever new information changes it. Ongoing monitoring then compares actual activity with this profile.
What goes into an economic profile
| Customer | Information recorded |
|---|---|
| Every customer | Purpose of the relationship; expected account turnover; nature of the transactions; expected origin of incoming funds and destination of outgoing payments; size of wealth, annual income and main business or professional activity |
| Companies and other legal persons | Also the company name, country of incorporation, head office address, beneficial owners, directors and authorised signatories, financial information, and the group structure (parent, subsidiaries and associates, their activities and finances) |
| Where it is kept | A separate form in the customer's file, alongside internal records of meetings with the customer |
| When it is updated | Regularly, and whenever new information adds to or changes the profile |
Source: CySEC Directive for the Prevention and Suppression of Money Laundering and Terrorist Financing.
Why is identity evidence built up cumulatively?
No single document can be guaranteed as genuine or correct, so identification is generally built from several pieces of evidence. The strongest evidence is the information hardest to alter or obtain illicitly, drawn from reliable and independent sources. The home address is treated as an essential part of identity with its own check, so the same document or data can never verify both the customer's identity and their address.
Terms used in this note
- Expected turnover
- The volume of money the customer is expected to move through the account over a period, recorded before the relationship starts.
- Source of funds
- Where the money in a particular transaction or relationship comes from, as opposed to source of wealth, which covers how the customer built up their overall assets.
How does the profile connect to monitoring and reporting?
Monitoring is a comparison: actual transactions against the pattern the profile expects. A firm that does not understand a customer's normal activity cannot tell when something is unusual, and so cannot meet its duty to spot suspicious transactions and report them to MOKAS. That is why the profile must stay current; see What is ongoing monitoring?
How to think about it
The profile is the baseline. Before onboarding, write down what this customer should be doing, in what amounts and with whom. Every later check measures reality against that baseline, so a stale profile leaves monitoring blind.
Common mistakes
Collecting the profile once and never updating it. It is updated regularly and whenever new information emerges.
Using one document to prove identity and address. Each needs separate evidence.
Relying on one perfect document. Identification is cumulative; no single document is fully guaranteed.
Recording only identity details. The profile also covers purpose, expected turnover and the flow of funds.
Legal references
- The Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2007 (Law 188(I)/2007), as amended (opens in a new tab)
Article 61(1)(c) and (d) (purpose of the relationship, ongoing monitoring)
- CySEC Directive for the Prevention and Suppression of Money Laundering and Terrorist Financing, as amended (opens in a new tab)
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