Proportionality in KYC: matching depth to assessed risk

Uniform diligence is a budget spread thin: too much scrutiny of the low-risk majority, too little of the high-risk few. Proportionality allocates depth by assessed risk. In practice: verification and screening for standard relationships; add beneficial ownership where the counterparty is an entity of any complexity; escalate to enhanced due diligence on defined triggers, such as PEP status, higher-risk jurisdiction, adverse indicators or transaction scale; and reserve network mapping and source-of-wealth work for the cases whose risk justifies it. Two disciplines keep the model defensible. First, triggers are written down before they are needed, so escalation is a rule, not a mood. Second, every de-escalation is recorded with its rationale, because the file must show why less was enough.