Once the LFI is satisfied that it knows the assurance levels of the digital ID system, it should analyze whether the digital ID system is adequate for the purposes of performing CDD in the context of the relevant illicit financing risks associated with the LFI’s customers, products and services, geographic areas of operations, and other relevant factors. Depending on the availability of digital ID systems, LFIs may have the option to select from multiple digital ID systems that have different assurance levels for identity proofing and authentication. In such circumstances, LFIs should match the robustness of the system’s identity proofing and/or authentication processes to the type of potential illicit activities and level of ML/TF risks.

In choosing among digital ID systems providing the same assurance level, or selecting among varying levels of identity proofing and/or particular credentials and authenticators offered by a single system, LFIs should consider their specific ML/TF risks as they relate to identity proofing and authentication in selecting an option. LFIs may also have the option to choose appropriate digital ID systems for lower-risk scenarios.