What is correspondent banking due diligence?
Special EDD applied by a bank ("correspondent") providing services to another bank ("respondent") in another jurisdiction. The Wolfsberg Principles for Correspondent Banking, FATF Rec. 13 and US BSA require collecting information on the respondent's ownership, AML controls, regulatory status, customer base, and senior-management approval before opening the relationship. Shell-bank relationships (no physical presence and no affiliation with a regulated group) are prohibited in most regimes.