Under Article 4.1 of the AML-CFT Decision and Paragraph 16.2.3 of the Standards, LEH must identify, assess, understand, and mitigate the risk posed by their customers. Customer risk is a critical component of an institutional-level risk assessment because customers engaged in illicit activity can seek to exploit the LEH to facilitate ML/FT and other types of financial crimes. The customer risk assessment process is composed of the customer risk rating, and the assessment of the inherent risk of the customer base. It should be noted that these are closely related concepts, and that risk in the customer base depends in part on the customer risk rating.