What Anti-Money Laundering means, the regulatory framework, and how AML compliance programs work.
Anti-Money Laundering (AML) encompasses the laws, regulations, and procedures designed to prevent criminals from disguising illegally obtained funds as legitimate income.
KYB/KYC: Verify customer identities
Transaction Monitoring: Detect suspicious patterns
Sanctions Screening: Check against prohibited parties
Suspicious Activity Reporting: Report potential crimes to authorities
Risk-Based Approach: Allocate resources by risk level
AML is often paired with CFT (Combating the Financing of Terrorism) as "AML/CFT" because detection methods overlap. Both rely on:
KYB is a critical AML control—verifying business customers prevents shell companies from being used to launder money. AML obligations drive beneficial ownership identification requirements.