- AML/CTF
- Anti-Money Laundering and Counter-Terrorism Financing — the regime that requires regulated businesses to help detect and deter financial crime.
- AML/CTF program
- The framework a reporting entity maintains to identify, manage and reduce money-laundering and terrorism-financing risk, including its policies, processes and governance.
- AUSTRAC
- Australia’s financial intelligence agency and AML/CTF regulator. Reporting entities enrol with, and report to, AUSTRAC.
- AML/CTF compliance officer (AMLCO)
- The person an organisation appoints to be responsible for oversight of its AML/CTF program.
- Audit trail
- A record of important actions and decisions, kept so activity can be reviewed and evidenced later.
- Beneficial owner
- The individual who ultimately owns or controls a customer, such as a person behind a company or trust.
- Customer due diligence (CDD)
- Identifying and verifying a customer, understanding the nature of the relationship, and assessing the risk it presents.
- Designated service
- A specific service listed in the AML/CTF law that brings the business providing it into the regime. Scope depends on the service, not the profession.
- Enhanced customer due diligence (ECDD)
- Additional checks applied in higher-risk situations, such as a politically exposed person or an unusual transaction.
- Enrolment
- Registering with AUSTRAC as a reporting entity when you provide designated services.
- Evidence
- The documents and records collected to support identity verification and due diligence decisions.
- IFTI
- International funds transfer instruction — a type of report some reporting entities must lodge for transfers into or out of Australia.
- KYC (know your customer)
- A commonly used term for the customer-identification part of customer due diligence.
- ML/TF risk assessment
- An assessment of money-laundering and terrorism-financing risk across the services offered, customer types, delivery channels and countries involved.
- Ongoing customer due diligence
- Keeping customer information current and proportionate to risk through monitoring and periodic or triggered reviews.
- PEP (politically exposed person)
- A person who holds or has held a prominent public position, or a close associate of one. PEPs are not automatically suspicious but generally carry higher risk.
- Reporting entity
- A business that provides one or more designated services and therefore has AML/CTF obligations.
- Risk-based approach
- Applying effort and controls in proportion to the level of assessed risk, rather than treating every customer the same.
- Sanctions screening
- Checking a customer against government sanctions lists to identify prohibited dealings.
- SMR (suspicious matter report)
- A report to AUSTRAC where a reporting entity forms a suspicion on reasonable grounds about a customer or transaction.
- Source of funds / source of wealth
- Where the money used in a transaction comes from (funds), and how a customer accumulated their overall wealth (wealth).
- Tipping off
- Improperly disclosing that a suspicious matter report has been, or may be, made — an offence under the AML/CTF law.
- Tranche 2
- The newly regulated professional-services sectors brought into Australia’s AML/CTF regime: legal professionals, accountants, conveyancers, real estate professionals, and dealers in precious metals, stones and products.
- TTR (threshold transaction report)
- A report to AUSTRAC of a cash transaction at or above the reporting threshold.