What is the 50 percent rule?  The OFAC 50 percent rule – also known as ‘Entities Owned by Blocked Persons’ – is a rule that banks must focus on when doing business within the US (under the jurisdiction of the Office of Foreign Assets Control [OFAC], hence its name). The UK and the EU both […]

What is anti-money laundering? Anti-money laundering (AML) refers to the laws, regulations, and processes designed to prevent, identify, and stop the transaction of illicit funds. For more information, refer to Money Laundering.

What is customer due diligence (CDD)? Customer due diligence (CDD) is a process that banks and financial institutions use to verify the identities of their customers, and by understanding the nature of their business. It is a part of the know your customer (KYC) process which, as the name suggests, requires companies to know who […]

What is enhanced due diligence (EDD)? EDD is used when a customer due diligence (CDD) highlights a need for further scrutiny on behalf of the financial institution. This occurs where an individual or organization has been flagged as higher risk. This might be due to the client conducting business in a higher risk country or […]

What are explicit sanctions? Explicit sanctions make up just 5% of sanctioned entities and are when a person or business is explicitly named in sanctions lists.  For more information, see sanctions screening.

What is the Financial Action Task Force (FATF)? The Financial Action Task Force (FATF) is an intergovernmental body that functions as a global watchdog, setting the international standard for anti-money laundering (AML) and counter-terrorist financing (CTF) procedures. This standard is called the FATF Recommendations and includes requiring countries to regulate and supervise financial institutions. How […]

What is FRAML? FRAML is a catch-all term often used to describe Fraud and Anti-Money Laundering strategies and operations. It is seen as a shift in approach to fighting financial crime, combining the efforts to fight fraud and money laundering by using an integrated approach between teams.

What are implicit sanctions?  Implicit sanctions make up 95% of sanctioned entities. These entities may be subject to sanctions if they fit within the broad statement (the narrative summary), which accompanies each sanctions list. As such, their sanctioning is implied.  This means that a person not named in a sanctions list might be sanctioned through […]

What is Know Your Customer (KYC)? Know your customer (KYC) is a term that relates to financial institutions having to know whom they are dealing with via various background checks and processes. Using anti-financial crime software, banks and other organizations must confirm the identity of individual clients and organizations and ensure that they are not […]

What is machine learning? A field of study in artificial intelligence (AI), machine learning involves the development of algorithms that allow computers to find patterns in data and forecast or make judgments about their findings using computational models. What types of algorithms does machine learning use? Machine learning may use a variety of different algorithms […]