2026 QFA Regulations Exam 1 Complete Practice Test

In AML/CFT frameworks, the levels of Customer Due Diligence are standard, simplified, and enhanced. There is no recognized level called "Prime." That makes the term not fit within the CDD framework.

Standard due diligence is the baseline for all customers: verify identity, assess risk, understand the customer’s business, and monitor transactions on an ongoing basis. Simplified due diligence is used only when the risk is low, allowing some verification and monitoring steps to be reduced while still meeting regulatory minimums. Enhanced due diligence is reserved for higher-risk situations, requiring more thorough identity checks, deeper information on source of funds, closer ongoing monitoring, and often senior management oversight.

So the option that does not belong as a CDD level is the one named Prime.