Service provider due diligence: An overview

Abstract

This paper is meant to provide any compliance professional, regardless of their firm’s size or business model, with the information needed to create and implement a reasonable due diligence process within their firm’s compliance programme. You will learn the specific regulations that apply to your type of firm, why they are required and how they can be addressed. It all starts with a risk assessment process, which is explained in sufficient detail that any type of firm can implement one. Specific tools are discussed to help identify and document important risks that must be a part of any sound due diligence process. We look at the initial and ongoing due diligence process and responsibilities firms have and offer examples of meeting these requirements. Finally, we identify how the due diligence process should be memorialised, documented and tested within the compliance programme.