A hawala broker.
For financial crime professionals, AML officers, or anyone seeking clarity on fraud and AML terms, Edifice offers a glossary of common acronyms and definitions.
We’ll continuously update this resource to reflect industry developments.
A potential match or name match in the sanctions screening process indicates a possible sanctioned person.
Human smuggling refers to a person’s transport or illegal entry across international borders in contravention of one or more countries’ laws. Human smuggling differs from human trafficking in that it focuses on the entry or transport rather than the exploitation of the person involved.
Human trafficking is the exploitation of people by force, fraud, or coercion for reasons such as forced labour, sexual abuse, or organ harvesting. It is considered a grave violation of human rights and is frequently linked to organised crime networks that benefit from abusing vulnerable people. In the context of anti-money laundering (AML) efforts, financial transactions associated to human trafficking may involve the laundering of proceeds from criminal acts, demanding monitoring and notification to authorities to combat this crime effectively.
Type of information about a sanctions target that is recorded on a sanctions list, for example, name, date of birth, jurisdiction, national identification number, entity with which a target is linked, information about penalties imposed against a target, registered legal address, and website URL. Identifiers apply to both individuals and legal entities.
To commit fraud or other crimes, the unauthorised use of someone else’s personal information, such as name, government-issued identity card, social security number, or financial details, resulting in economic loss, damage to the victim’s credit, and other legal or personal consequences. Identity theft is a significant concern in AML efforts, as stolen identities can be used to open fraudulent accounts and launder money.
The level of sanctions risks before controls are applied to mitigate them. There are four main inherent risk categories: customers, products and services, countries, and delivery channels. Inherent risk is linked to the risk assessment process, which evaluates the effectiveness of an institution’s risk controls. Inherent risk considers the likelihood and impact of non-compliance before considering any mitigating effects of risk management processes.
The integration phase, often referred to as the third and last stage of the classic money laundering process, places laundered funds back into the economy by re-entering the funds into the financial system and giving them the appearance of legitimacy.
When an organization’s staff members commit or facilitate a sanctions violation. Examples include the following:
The process of obtaining, evaluating, recording, and storing information about an individual or legal entity with whom one is conducting business in response to an alert indicating a possible sanctions violation. Investigations often begin with simple checks before progressing to further investigation, such as account review, customer outreach, and potential escalation to the compliance function.