Understanding AML acronyms: A plain English glossary

Anti money laundering (AML) rules come loaded with acronyms, and it is easy to lose track of what each one means. If you work in an AML regulated business, that alphabet soup is part of the territory.

The good news is it doesn't have to be part of your job. This glossary gives you plain English definitions for reference, but with APLYiD, you won't need to memorise any of it. We live and breathe these terms so you don't have to.

Here they are anyway, for your interest:

AML: Anti Money Laundering
The laws and processes designed to stop criminals disguising illegal money as legitimate funds.

CTF: Counter Terrorist Financing
Rules aimed at stopping money being used to fund terrorism, often grouped together with AML. 

KYC: Know Your Customer
The process of checking who your customer actually is before you do business with them.

CDD: Customer Due Diligence
The standard checks you carry out on every customer, such as verifying identity documents.

EDD: Enhanced Due Diligence
Extra checks required for higher risk customers, such as those from high-risk countries or with complex ownership structures.

PEP: Politically Exposed Person
Someone who holds, or has held, a prominent public role, such as an MP or senior civil servant. PEPs require extra scrutiny because of the higher risk of bribery or corruption.

UBO: Ultimate Beneficial Owner
The real person who owns or controls a company, even if their name does not appear on official paperwork.

SAR: Suspicious Activity Report
A report you must file if you suspect a customer's activity is linked to money laundering.

MLRO: Money Laundering Reporting Officer
The person within a business responsible for overseeing AML compliance and reporting suspicious activity.

FATF: Financial Action Task Force
The global body that sets international AML standards, which UK’s laws are designed to meet.

Relevant Person

The MLR 2017 term for a business with AML obligations, such as real estate agents, lawyers, and accountants. POCA refers to the same population as "the regulated sector."

NCA: National Crime Agency
The UK body that receives SARs and investigates serious and organised crime, including money laundering.

FCA: Financial Conduct Authority
The regulator overseeing financial services firms, including their AML obligations.

HMRC: HM Revenue and Customs
Acts as the AML supervisor for several sectors, including accountancy and estate agency businesses that are not supervised elsewhere.

JMLSG: Joint Money Laundering Steering Group
A body that produces AML guidance used widely across UK financial services.

POCA: Proceeds of Crime Act 2002
The main piece of UK legislation covering money laundering offences and the confiscation of criminal assets.

MLR: Money Laundering Regulations
The specific UK regulations that set out what businesses must do to comply with AML law.

Getting comfortable with these terms makes conversations about compliance easier, whoever you are having them with. Even so, you do not need to become an expert – that's what APLYiD is for. We stay on top of the acronyms, the regulations, and the changes, so you can focus on what actually matters: knowing your customers and running your business.