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, which is known as money laundering. These include customer due diligence (CDD) and know your customer (KYC) checks. Learn more about money laundering and the processes involved. What laws exist in anti-money laundering? Although laws […]
What is bancassurance? Bancassurance refers to the partnership between a bank and an insurance company, whereby insurance products are sold through the bank’s distribution channels. This arrangement allows banks to offer insurance services to their customers, either by selling products from a single insurance company or multiple insurers. The concept of bancassurance originated in France […]
What is counter terrorist financing? Counter-terrorist financing (CTF), also known as combating the financing of terrorism (CFT), refers to a set of policies, laws, and practices designed to prevent and disrupt the flow of funds to terrorist organizations and individuals. The primary goal of CFT is to starve terrorist groups of the financial resources they […]
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 Customer Risk Rating (CRR)? Customer risk rating (CRR) or customer risk score is the process of assessing the level of risk associated with a customer or client in terms of their potential involvement in financial crimes such as money laundering, terrorist financing, or other illicit activities. This rating is typically assigned to a […]
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 is entity resolution? Entity resolution is the process of identifying and linking multiple references to the same entity, such as a person, organization, or company, across different data sources and systems. In the context of financial crime, this involves disambiguating and consolidating data to create a single, accurate, and comprehensive view of an entity, […]
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 […]