Transaction risk categorization

Methodology

The risk model created by PEPData was developed to be flexible, maintaining a degree of simplicity that allows it to be easily understood. It is composed by 3 distinct risk categories with the following thresholds (in points):

• Low: [0 - 1]

• Medium: [1 - 2[

• High: 2+

Each transaction falls into the various risk categories, taking into account the following criteria:

• Existence of suspicion:

  • If you have a suspicion about the presented documentation or the transaction itself.

    • Increases the risk by 2 points.

• Payment method:

  • Virtual asset:

    • If the payment was made in an unregulated virtual asset

      • Increases the risk by 1 point.

    • If the payment was made through an entity that is not registered to carry out activities with virtual assets

      • Increases the risk by 2 points.

• Combination of Payment Method and Amount

  • Cash payments:

    • If the sum of payments in euros (€) made by individual entities is equal to or greater than 3.000€

      • Increases the risk by 2 points.

    • If the sum of payments in foreign currencies made by individual entities is equal to or greater than 10.000€, after the respective conversion has been made

      • Increase the risk by 2 points.

    • If the sum of payments made by collective entities is equal to or greater that 1.000€

      • Increases the risk by 2 points.

• Regulated virtual assets:

  • Bitcoin (BTH);

  • Ethereum (ETH)

• You can consult here the list of entities registered to carry out activities with virtual assets.

Note: our risk calculation algorithm is under constant development. If you have any proposal for improvement or specificity in your professional area, don't hesitate to contact us.