Privacy anddata protection restrictionsplaced uponfinancial institutions (FIs) in the EUrequire that FIs must: (Select Two.

Financial institutionsoperating in the EU must comply with GDPR and AML directives, ensuring a balance betweenprivacy and AML compliance.

Option B (Correct):Data minimization is a key GDPR principle, ensuring that only necessary data is collected and processed.

Option D (Correct):Strict guidelines apply to AI and machine learning models used in AML complianceto prevent bias and ensure transparency.

Why Other Options Are Incorrect:

Option A (Incorrect):FIs cannot use third parties to supplement missing customer identification unless proper KYC measures are followed.

Option C (Incorrect):Customers cannot be informed about ongoing AML investigations due to “tipping off” restrictions under AML laws.

Best Practices for AML Compliance Under GDPR:

Limit data collection to what is necessary for AML compliance.

Ensure AI and machine learning models comply with transparency regulations.

Prevent unauthorized data access through strict internal controls.