Most companies will appoint an AML compliance officer to provide compliance policies and processes in relation to customer due diligence and monitoring for the company to follow.

New regulations are imposed continuously to keep up with the sophisticated methods that the criminals are using, and regulatory authorities increase audits and raise penalties to combat money laundering activities, so companies must prioritise AML compliance. It can be complicated for companies to comply with AML legislation and regulations. The control processes implemented in the Know Your Customer due diligence checklist ensures that the business has the necessary information about the customer to open an account and determine the customer’s risk level. One of these procedures is the Know Your Customer ( KYC). Regulators publish a series of procedures to achieve this goal and companies have to comply with these procedures. The primary purpose of AML regulations is to prevent money laundering. In the UK some businesses and individuals must register with a supervisory authority to follow anti-money laundering regulations (these regulations are examined later in this article). The aim of anti-money laundering (AML) is to deter criminals from feeding their illicit funds into the financial system. Inter-agency co-operation was improved, lines of communication between law enforcement and financial institutions were increased, and financial reporting requirements for international transactions were expanded. The UK became a member of the FATF in 1990.įollowing the 9/11 attacks on the US, the FATF expanded its mandate to include AML and combatting terrorist financing. Its mission is to devise and promote international standards to prevent money laundering and to develop policies to combat money laundering. In 1989, multiple countries and organisations, on the initiative of the G7, formed the global Financial Action Task Force (FATF). The United States was one of the first nations to enact anti-money laundering legislation when it established the Bank Secrecy Act (BSA) in 1970.

Anti-Money Laundering (AML) is the overall term to describe the group of laws, processes and regulations used to prevent the illegal generation of income.

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