Trade Finance Forum › Forums › Market Regulations › Laws and Bills › How do banks and other financial institutions go about identifying and preventing the funding of terrorist organizations and other criminal activities? › Reply To: How do banks and other financial institutions go about identifying and preventing the funding of terrorist organizations and other criminal activities?
In order to prevent criminals and terrorists from misusing the financial system, the implementation of measures known as anti-money laundering and counter-terrorist financing (AML/CFT) policies is necessary. Countries are able to contribute to the tracing and stopping of the money flows associated with severe crime and terrorism if they effectively execute these measures, which in turn helps to make society safer.
AML policies involve identifying and verifying customers and their sources of funds, as well as monitoring customer transactions for suspicious activity. Customer due diligence includes the identification and assessment of the customer’s risk profile. Additionally, banks and other financial institutions may employ technologies such as artificial intelligence to detect suspicious activity. These measures are in place to ensure that banks and other financial institutions are compliant with regulatory requirements.