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AML/CFT Compliance: CAMS Exam Preparation

The map of the exam: every domain it tests, the syllabus in order, and the vocabulary you are expected to use precisely. Built from the primary sources the exam itself is based on, FATF, the regulators, and real enforcement actions. Read it to see the whole shape of the exam; learn each topic in the interactive classroom.

Certifying body: Association of Certified Anti-Money Laundering Specialists (ACAMS) · 11 modules · 49 lessons · 311 terms

Part 1 · The exam at a glance

What the exam tests

Every domain the CAMS exam tests, taught from the primary sources the exam itself is built on: FATF, the regulators, and real enforcement actions. Not a rehash of a third-party study guide.

4 domains11 modules49 lessons100% coverage

Risks and Methods of Money Laundering and Terrorist Financing

Covered

What money laundering and terrorist financing are, the methods and typologies criminals use, the customers, products, and sectors most exposed, and the wider financial-crime landscape of fraud, bribery, and tax evasion.

Foundations of Money Laundering and Terrorist Financing4 lessons
High-Risk Categories and Typologies5 lessons
The Broader Financial-Crime Landscape4 lessons
Learning from Enforcement6 lessons

Compliance Standards for AML/CFT

Covered

The FATF Recommendations and the risk-based approach, the major sanctions regimes, and the national frameworks (US, UK, EU, and beyond) that turn the global standard into enforceable law.

The FATF Framework and the Risk-Based Approach4 lessons
Sanctions Compliance4 lessons
National Frameworks in Depth4 lessons

The AML/CFT Compliance Program

Covered

The working program: customer due diligence and beneficial ownership, suspicious-activity monitoring and reporting, and the governance, audit, training, and compliance-function structure that holds it together.

Customer Due Diligence and Beneficial Ownership5 lessons
Suspicious Activity Monitoring and Reporting4 lessons
Governance, Audit, and the Compliance Function4 lessons

Tools and Technologies to Fight Financial Crime

Covered

How the controls are operationalised in technology across the customer lifecycle: identity and onboarding, screening, transaction monitoring, AI/ML and network analytics, and the build-versus-buy judgment.

Tools and Technologies to Fight Financial Crime5 lessons

Domain structure follows the CAMS exam blueprint; confirm exam weighting against the current ACAMS candidate handbook. Enso Academy is independent and is not affiliated with, authorised by, or endorsed by ACAMS.

Part 2 · The syllabus

Every topic, in order

The full path through the course. Work it top to bottom, or jump to the area you need.

Module 1

Foundations of Money Laundering and Terrorist Financing

Establishes a precise working understanding of what money laundering and terrorist financing are, how they differ, and why states regulate them. Grounds the rest of the course in the underlying criminal phenomena that the AML/CFT framework exists to address.

01What Money Laundering Actually IsDefines money laundering from primary statutory texts and the FATF Glossary, separating the colloquial use of the term from its precise legal meaning.
02What Terrorist Financing Actually IsSeparates terrorist financing from money laundering as a distinct offence with distinct indicators, grounded in UN, FATF, and national counter-terrorism financing law.
03Why States Regulate Financial InstitutionsExplains the policy logic that places banks, money service businesses, and other gatekeepers at the centre of AML/CFT enforcement, rather than relying solely on criminal prosecution after the fact.
04The Global Architecture: FATF, FIUs, and SupervisorsMaps the institutional architecture of international AML/CFT: FATF and its regional bodies, financial intelligence units, the Egmont Group, and national supervisors.

Module 2

The FATF Framework and the Risk-Based Approach

Examines the FATF Recommendations as the global AML/CFT standard and develops the risk-based approach as the central operating principle of modern compliance.

01Structure of the 40 RecommendationsWalks through the 40 FATF Recommendations as an organised whole rather than a checklist, so the student can navigate the framework rather than memorise it.
02Risk-Based Approach as Operating PrincipleDevelops the risk-based approach from its origin in Recommendation 1 to its operational meaning in the institution.
03Enterprise-Wide Risk AssessmentTeaches how an institution conducts its enterprise-wide ML/TF risk assessment as required by Recommendation 1 and national equivalents.
04Customer Risk Rating ModelsExamines how institutions translate the risk-based approach into a workable customer risk rating, including the trade-offs in model design.

Module 3

Customer Due Diligence and Beneficial Ownership

Develops the operational core of preventive AML: identifying who the customer is, who ultimately owns and controls them, and what level of due diligence is required.

01CDD Fundamentals: Identifying the CustomerEstablishes the four pillars of customer due diligence under Recommendation 10 and shows how they manifest in national rules.
02Enhanced Due Diligence: When and HowDistinguishes EDD from standard CDD and develops the operational toolkit for high-risk customer onboarding and review.
03Beneficial Ownership InvestigationDevelops the practitioner skill of identifying ultimate beneficial owners through complex corporate structures.
04Ongoing Monitoring and CDD RefreshTreats the often-neglected obligation to keep CDD current and to monitor the relationship throughout its life.
05Reliance on Third Parties and Introduced BusinessAddresses the specific case of relying on a third party (intra-group or external) for CDD performance.

Module 4

Suspicious Activity Monitoring and Reporting

Builds the practitioner capability to identify, investigate, and report suspicious activity through the lifecycle from detection to financial intelligence unit submission.

01Transaction Monitoring Systems and RulesDemystifies how transaction monitoring actually works, including the design of rules and scenarios and the failure modes endemic to the function.
02From Alert to InvestigationDevelops the analyst workflow from alert receipt through investigation, documentation, and decision.
03Drafting the Suspicious Transaction ReportTeaches how to draft a STR/SAR that produces actionable intelligence for the FIU and demonstrates the institution's competence.
04The Life of a Financial Intelligence ProductFollows what happens after submission: how FIUs analyse, disseminate, and share intelligence, and what feedback the institution can expect.

Module 5

Sanctions Compliance

Treats sanctions as a discipline distinct from but adjacent to AML/CFT, including screening, evasion typologies, and the multi-regime nature of sanctions risk.

01The Multi-Regime Landscape of SanctionsMaps the major sanctions regimes and the principles by which they interact (and conflict).
02Sanctions Screening Mechanics and DesignDevelops practitioner understanding of how sanctions screening works, including list management, matching algorithms, and false-positive handling.
03Sanctions Evasion TypologiesExamines how sanctioned persons and jurisdictions evade controls, so that the student can recognise the patterns.
04Sanctions Program GovernanceTranslates the OFAC Framework for Compliance Commitments and equivalent guidance into the institution's governance arrangements.

Module 6

High-Risk Categories and Typologies

Examines the customer categories, products, and channels that receive sustained regulatory and FATF attention, and the typologies that animate that attention.

01Politically Exposed PersonsDevelops the PEP framework from FATF Recommendations 12 and 22 through to operational onboarding and review.
02Correspondent Banking RiskTreats correspondent banking as a category that imports another institution's risk and develops the controls required to manage it.
03Trade-Based Money LaunderingTreats TBML as the most operationally complex AML topic, with specific attention to the Bangladesh context given its trade-heavy economy.
04Virtual Assets and VASPsDevelops the AML/CFT framework for virtual assets and the institutions that handle them, including the Travel Rule.
05Real Estate, Cash-Intensive Businesses, and Luxury GoodsCovers the non-bank channels that absorb significant illicit value and the patterns that practitioners need to recognise in connected bank accounts.

Module 7

National Frameworks in Depth

Develops working knowledge of the United States, United Kingdom, European Union, and Bangladesh frameworks as comparative cases.

01The US FrameworkMaps the US AML/CFT framework from the BSA through the AMLA 2020 and CTA, with attention to the agencies and their tools.
02The UK FrameworkMaps the UK AML/CFT framework with attention to its principal statutes, the regulator landscape, and the JMLSG guidance role.
03The EU Framework and the AML PackageMaps the EU AML framework through the directives and the 2024 AML Package transition to direct-effect regulation and a central authority.
04The Bangladesh FrameworkDevelops detailed working knowledge of the Bangladesh AML/CFT framework, with particular attention to BFIU Circular 26 as the operational instrument.

Module 8

Governance, Audit, and the Compliance Function

Treats AML/CFT as an institutional discipline that requires governance, independent audit, training, and a credible compliance function.

01The Three Lines of DefenceApplies the three-lines-of-defence model to AML/CFT specifically, including the responsibilities of business, compliance, and audit.
02The MLRO/CCO Role and the Compliance FunctionDevelops the role of the designated compliance officer (MLRO in the UK, CCO under BFIU regime, BSA Officer in the US) and the compliance function around them.
03Independent Audit of AML/CFTDevelops the third-line audit function for AML/CFT, including scope, frequency, and what good looks like.
04Training and CultureTreats training and culture as the controls that determine whether documented procedures actually operate.

Module 9

Learning from Enforcement

Closes the course by reading major enforcement actions as detailed teaching texts, extracting transferable lessons for the practitioner's own institution.

01How to Read an Enforcement ActionDevelops the practitioner skill of reading a public enforcement document for operational lessons rather than for headline figures.
02Case Study: Correspondent Banking FailuresDeep reading of the HSBC 2012 DPA and the Standard Chartered settlements as the foundational correspondent banking enforcement cases.
03Case Study: The Danske Bank Estonia AffairReads the Bruun & Hjejle independent report and the US DOJ resolution as the foundational case on non-resident portfolio risk and governance failure.
04Case Study: Westpac and the LitePay ChannelReads the AUSTRAC Statement of Agreed Facts as a case on product-specific risk and the catastrophic consequences of inadequate monitoring scenarios.
05Case Study: 1MDB and the Private Banking Failure ModeReads the Goldman Sachs DPA and the related public materials as a case on PEP, source of wealth, and complex-structure failures in private banking.
06Course Synthesis and Exam PreparationCloses the course by synthesising the discipline and preparing the student for the certification examination format.

Module 10

Tools and Technologies to Fight Financial Crime

How anti-financial-crime controls are operationalised through technology across the customer lifecycle, onboarding, screening, monitoring, investigation, and how practitioners select, integrate, govern, and prioritise those tools by risk. Maps to CAMS Domain D.

01The AFC Technology Landscape and the Build/Buy DecisionMaps the anti-financial-crime technology stack to the customer lifecycle and develops the practitioner judgment behind selecting, integrating, governing, and prioritising those tools by risk.
02Identity and Onboarding TechnologyHow digital identity, e-KYC, biometrics and external data sources operationalise customer due diligence at the gate, and how they fail when the verification does not keep pace with the risk.
03Screening Systems: Sanctions, Watchlists and Fuzzy MatchingHow name and customer screening engines, list management, fuzzy matching and adverse-media screening interdict prohibited and high-risk parties, and why a screening tool only works if the data reaches it and the lists are maintained.
04Transaction-Monitoring Systems: Rules, Scenarios and Model RiskHow rules-based transaction-monitoring systems are designed, calibrated and governed, segmentation, scenario coverage, threshold setting, statistical testing and model risk management, and how scenario gaps become enforcement.
05AI/ML, Network Analytics and Investigation ToolingHow institutions move from rules to AI/ML detection, use network and link analysis to see relationships rules miss, and equip investigators with open-source and automation tooling, within the privacy and explainability limits the technology carries.

Module 11

The Broader Financial-Crime Landscape

Extends the course beyond money laundering into the wider anti-financial-crime perimeter the current CAMS/AFC blueprint names under Domain A: fraud, bribery and corruption, tax evasion, and the under-covered high-risk sectors.

01Fraud and the Fraud-AML Nexus (FRAML)Develops fraud as a financial-crime discipline in its own right and as an AML predicate: the major fraud typologies (identity, payment, authorized push payment, investment, and business email compromise) and the operational convergence of fraud and AML controls (FRAML).
02Bribery and Corruption (ABC)Covers the anti-bribery and corruption framework and its money-laundering nexus: the FCPA and the UK Bribery Act, corruption typologies, facilitation payments, third-party and intermediary risk, and the link between grand corruption, kleptocracy, and politically exposed persons.
03Tax Evasion and Financial CrimeTreats tax evasion as a financial crime and AML predicate: the distinction between evasion and lawful avoidance, the AML-tax nexus, offshore structuring and concealment, and the transparency regimes (CRS, FATCA) built to counter cross-border tax evasion.
04Sector Risk Deep-Dives: Insurance, Gaming, MSBs/PSPs and the ProfessionsExamines the money-laundering risk profiles and red-flag indicators of sectors the core course under-covers: life insurance, casinos and gaming, money services businesses and payment service providers, and the accountancy profession as gatekeepers.

Part 3 · Glossary

The vocabulary, defined

The terms the exam expects you to use precisely. Review them the night before.

1MDB matter: The sovereign-fund private-banking and gatekeeping failure.
50 Percent Rule: OFAC rule blocking entities 50%+ owned in aggregate by blocked persons.
Above-the-line testing: Testing the alerts the system produced.
Account takeover: Unauthorised takeover of a real customer's account.
Adverse media screening: Negative-news checks on customers.
Alert disposition: The documented decision to close or escalate an alert.
All-crimes approach: Any crime can be a predicate.
AML audit: Independent third-line review of the AML program.
AML program pillars: Core required elements of an AML program.
AML training: Staff training on recognising and responding to financial-crime risk.
AMLA: The new EU-level AML supervisory authority.
Anti-Money Laundering Act of 2020: The 2020 US AML overhaul, containing the CTA among broader reforms.
Anti-Terrorism Act 2009 (Bangladesh): Bangladesh's CT/TF statute; TF offence in section 7.
Audit findings: Audit-identified deficiencies, to be remediated and escalated.
Audit scope: The program-wide, risk-based coverage of an AML audit.
Authentication: Re-verifying a returning user's identity.
Authorized push payment (APP) fraud: Victim is tricked into authorising the payment.
Bank Secrecy Act: The foundational US AML statute, 31 U.S.C. § 5311 et seq.
Behavioural analytics: Flagging deviation from a learned baseline.
Below-the-line (BTL) testing: Testing for risk missed below a threshold.
Below-the-line testing: Sampling sub-threshold activity to estimate missed detections.
Beneficial owner: The natural person ultimately owning or controlling a customer.
BFIU master circular: The BFIU's binding consolidated AML/CFT compliance instructions.
Biometric liveness: Anti-spoofing check that a live person is present.
Block vs reject: Freeze-and-hold vs decline-and-return.
Blocking (freezing): Freezing and holding designated-party property, with reporting.
Blocking Regulation: EU regulation barring compliance with certain extraterritorial US sanctions.
Bribery: Improper payment to influence a decision.
BSA officer: The US named officer for BSA compliance and reporting.
Build vs buy: In-house build vs vendor purchase decision.
Business email compromise (BEC): Payment-redirection fraud via impersonation.
Cash-intensive business: A high-cash business whose takings can mask illicit funds.
Champion/challenger: Test a new model alongside the live one.
Chief compliance officer: The senior accountable owner of the compliance program.
Child-exploitation indicators: Indicator-level detection patterns for exploitation-linked payment typologies.
Chip-walking: Cashing out little-played casino chips as 'winnings'.
Commercial bribery: Private-sector (non-official) bribery.
Compliance culture: The lived norms governing how seriously financial-crime risk is taken.
Compliance function: The independent second-line AML/CFT framework function.
Consent order: A regulator's administrative enforcement and remediation instrument.
Continuing education: Ongoing learning to keep AML/CFT competence current.
Control by other means: Control without a qualifying equity stake.
Control effectiveness: How well a control actually mitigates risk, in design and in operation.
Control test: Identifying beneficial owners by ultimate control exercised through other means.
Controlling person (CRS): Natural person controlling a passive entity/trust.
Corporate layering: Entity chains used to obscure the ultimate beneficial owner.
Corporate Transparency Act: The US beneficial-ownership registry statute, narrowed to foreign companies in 2025.
Correspondent banking: One bank providing account services and system access to another.
Coverage testing (screening): Testing that screening catches known cases.
Criminal property: Property representing the benefit of criminal conduct, in whole or in part.
CRS: Multilateral tax-residence reporting standard.
CTR and STR (Bangladesh): Bangladesh's threshold-based cash report and suspicion-based suspicious report.
Currency transaction report (CTR): US report for >USD 10,000 daily cash.
Customer due diligence: The four-element process of knowing and monitoring a customer.
Customer Identification Program: The PATRIOT Act section 326 customer-identity-verification requirement.
Customer risk rating: The customer-level score that routes due-diligence and monitoring treatment.
Customer segmentation: Peer-grouping customers to define 'normal'.
DAML moratorium period: POCA 31-day post-refusal freeze.
Danske Bank Estonia affair: The Estonian-branch non-resident-portfolio governance failure.
De-risking: Category-level customer exit to avoid rather than manage risk.
Defensive reporting: Over-reporting without genuine suspicion.
Deferred prosecution agreement: A criminal resolution suspending prosecution on agreed conditions.
Deferred prosecution agreement (DPA): Charges dropped if conditions are met.
Designated categories of offences: Predicate offences ML law must cover.
Designated non-financial businesses and professions: Non-financial gatekeepers subject to AML obligations.
Disgorgement / forfeiture: Surrender of illicit gains.
DNFBP: Non-financial businesses with AML duties.
Documentary boundary: Payment turns on document conformity, but financial-crime duties still apply.
Domestic PEP: A home-country PEP, handled on a risk-sensitive basis.
e-KYC: Digital identity verification at onboarding.
Effective challenge: Probing, not rubber-stamping, by the board.
Effectiveness (Immediate Outcomes): Assessment of whether the AML/CFT system works in practice, via eleven Immediate Outcomes.
Egmont Group: The global network for secure FIU-to-FIU intelligence exchange.
Enforcement analysis: Reading enforcement actions for transferable control and root-cause lessons.
Enhanced due diligence: Intensified CDD for higher-risk customers and situations.
Enterprise-wide risk assessment: The group-level AML risk assessment connecting exposures across business lines.
Entity resolution (golden record): One linked record per real entity.
EU AML Package 2024: The 2024 EU reform introducing the single rulebook and AMLA.
EU sanctions: EU restrictive measures under directly applicable regulations.
Explainability: Being able to explain why a model decided.
Extraterritoriality: Sanctions reaching conduct beyond the imposing jurisdiction's borders.
Facilitation (sanctions): Helping a third party do the prohibited.
Facilitation payment: Small 'grease' payment for routine official action.
Failure to prevent facilitation of tax evasion: Corporate offence for not preventing tax-evasion facilitation.
False negative: Suspicious activity that monitoring failed to flag.
False positive: An alert that turns out to be legitimate activity.
FATCA: U.S.-person account reporting regime.
FATF: The inter-governmental AML/CFT standard-setting body.
FATF Recommendations: The forty international AML/CFT standards.
FATF-style regional body: Regional body applying FATF standards and evaluations to its members.
FCPA: U.S. anti-foreign-bribery statute.
Feedback loop: Routing FIU and downstream signals back into monitoring and training.
Fifth Anti-Money Laundering Directive: The EU directive adding VASPs and strengthening BO registers.
Filing clock: The statutory deadline for filing a report after suspicion arises.
Final Notice: The FCA's published enforcement decision and reasoning.
Financial Conduct Authority: UK conduct regulator and AML supervisor for financial institutions.
Financial intelligence: Analysed financial information supporting investigation, distinct from evidence.
Financial intelligence unit: The national centre for receiving, analysing, and disseminating financial intelligence.
FinCEN: The US FIU and BSA administrator.
First line of defence: The business that owns and manages risk at source.
First-party vs third-party fraud: Fraud by the customer vs against the customer.
Foreign official (FCPA): Includes state-owned-enterprise staff under the FCPA.
Foreign PEP: A foreign-country PEP, subject to mandatory enhanced measures.
Fourth Anti-Money Laundering Directive: The EU directive setting the risk-based AML core.
FRAML: Convergence of fraud and AML controls.
Fraud: Deception to obtain money or property.
Front company: An unlisted entity transacting for a sanctioned actor.
Fuzzy matching: Screening that catches name variants by balancing precision and recall.
Gatekeeper: Professional controlling access to structures.
Gatekeeper model: Deputising institutions at financial choke points with enforceable AML duties.
General vs specific licence: Class authorisation vs case-by-case authorisation.
Geographic Targeting Order (GTO): Area-targeted FinCEN reporting order.
Global Network / FSRBs: FATF + regional bodies, 200+ jurisdictions.
Governance failure: A breakdown of oversight, escalation, and decision-making.
Grey list vs black list: Increased monitoring vs call for action.
Growth-over-controls pattern: Growth outpacing controls.
High-risk customer: A customer routed to enhanced due diligence, approval, and monitoring.
High-risk jurisdictions subject to a call for action: FATF's black list, jurisdictions attracting enhanced due diligence and possible countermeasures.
Horizon scanning: Learning from others' enforcement proactively.
HSBC deferred prosecution agreement (2012): The 2012 correspondent-banking matter centred on a misrated high-risk corridor.
Human-in-the-loop: Tools support; humans decide and own it.
Identification: Obtaining a customer's or beneficial owner's identifying data.
Identification vs verification: Obtaining identity data vs confirming it.
Identity proofing: Establishing who a new customer really is.
Independent monitor: External overseer of remediation.
Independent testing: AML testing by parties independent of the program.
Indirect proceeds: Property derived from criminal proceeds.
Inherent risk: Risk exposure assessed before any controls are applied.
Integration: Re-entry of laundered funds into the legitimate economy in apparently lawful form.
International information sharing: Cross-border FIU intelligence exchange, bounded by use limitations.
International organisation PEP: An international-organisation official treated on a risk-sensitive PEP basis.
Interpretive Note: FATF's binding elaboration of a Recommendation's requirements.
Intra-group reliance: Eased reliance within a group operating supervised group-wide standards.
Introduced business: Customers onboarded via an introducer under reliance conditions.
JMLSG guidance: UK industry guidance on meeting AML obligations.
Jurisdictions under increased monitoring: FATF's grey list, action-plan jurisdictions under enhanced FATF monitoring.
Key risk indicator (KRI): Leading indicator of rising risk.
Kleptocracy: Systematic state looting by officials.
KYC refresh: Re-verifying the substantive CDD picture against current information.
Layering: Transactions designed to distance funds from their criminal source.
List management: Timely ingestion and re-screening of designation-list updates.
LitePay channel: Westpac's low-value remittance channel in the AUSTRAC matter.
Liveness detection: Check that a real live person is present.
Match score: Similarity score for a screening hit.
Match threshold: Screening sensitivity setting governing hits.
Mexico corridor (HSBC): The misrated high-risk HSBC correspondent channel.
Mitigating factors (enforcement): Conduct that reduces enforcement penalties.
Mixers and privacy coins: Tools and assets built to obscure virtual-asset traceability.
ML vs TF difference: Hiding source vs funding a purpose.
Model calibration: Tuning and validating a risk model so its outputs genuinely discriminate risk.
Model drift: Model performance decaying as behaviour shifts.
Model risk management: Governing the risk that a model is wrong.
Money laundering: Processing criminal proceeds to disguise their illegal origin.
Money Laundering Prevention Act 2012: Bangladesh's principal AML statute.
Money Laundering Regulations 2017: The UK preventive AML regime and supervisory split.
Money Laundering Reporting Officer: The UK named officer responsible for AML and the reporting decision.
Money mule: Account used to receive and pass on illicit funds.
Monitoring rule: A coded condition that raises an alert on a defined pattern or threshold.
Mutual evaluation: Peer-review assessment of a jurisdiction's AML/CFT system.
Name screening: Screening all relevant parties' names against sanctions lists.
National Crime Agency: UK agency hosting the FIU and receiving SARs.
National risk assessment: A jurisdiction's assessment of its ML/TF risks.
Nested correspondent relationship: A respondent funnelling other banks' activity through its correspondent account.
Network analysis: Mapping connections across accounts and entities.
Nominee shareholder: Holder of shares for the real owner.
Non-resident portfolio: The high-risk Danske Estonia non-resident customer book.
Obscuration: Techniques that conceal a sanctioned nexus from controls.
OFAC: The US sanctions administrator.
Offshore structuring: Layered structures hiding the real owner.
OFSI: The UK financial-sanctions administrator.
Omnibus (pooled) account: One account for an intermediary's many clients.
Ongoing monitoring: Continuous scrutiny of activity against the customer profile, with information kept current.
Operational analysis: FIU case-level analysis developing intelligence on specific subjects.
Operational effectiveness: Whether a control works in outcome, not just in activity.
Outsourcing (agency) in CDD: A provider performing CDD under the institution's control as its own work.
Outsourcing accountability: Tasks outsource; accountability does not.
Over-invoicing: Pricing goods above value to move excess value across borders.
Ownership of risk: The first line's responsibility for the risk it creates.
Ownership or control test: Caught by control, not only ownership.
Ownership test: Identifying beneficial owners by an ownership-percentage threshold.
Payable-through account: An account giving a respondent's customers direct access to the correspondent's account.
Payment screening: Real-time transaction sanctions screening.
Peer-group segmentation: Thresholds tuned to similar-customer groups.
PEP failures: Failures to apply required enhanced diligence to PEP-linked relationships.
Periodic review: Risk-driven cyclical CDD refresh.
Perpetual KYC (pKYC): Continuous, event-driven CDD refresh.
Personal liability: Individual enforcement exposure of named compliance officers.
Phantom shipment: Billing for goods that were never shipped.
Phantom shipments: Trade paperwork for goods that never shipped.
Placement: Criminal proceeds' first entry into the financial system.
Policy groupings of the Recommendations: The thematic sections organising the forty Recommendations.
Politically exposed person: A person entrusted with a prominent public function.
Pre-launch risk assessment: Assess new-product risk before launch.
Precision: Share of flagged results that are genuine.
Predicate offence: The underlying crime that generates the laundered proceeds.
Presentation attack: Spoofing a biometric system with a fake artefact.
Preventive regime: The legal regime making institutional AML control failure independently punishable.
Privacy-by-design: Privacy built in from the start.
Privacy-enhancing techniques: Analytics that protect underlying personal data.
Private-banking failures: Gatekeeping failures in high-value client relationships.
Proceeds of Crime Act 2002: The UK's principal money-laundering statute.
Product risk assessment: Pre-launch assessment of a product's specific financial-crime risks.
Professional enabler: Professional who facilitates financial crime.
Proliferation financing: Financing the acquisition or development of weapons of mass destruction.
Proportionality: Scaling measures to the business, without waiving the obligation.
Pseudonymity (blockchain): Traceable addresses not directly tied to names.
Purpose and intended nature of the relationship: The expected-activity baseline that makes monitoring meaningful.
Rating override: A governed manual change to a model-assigned rating.
Real estate money laundering: Laundering value through property purchases and opaque ownership.
Recall: Share of true matches caught.
Recommendation 14: Licensing/supervision of MVTS.
Recommendation 2: National AML/CFT coordination.
Recommendation 24 vs 25: BO of companies vs trusts.
Recommendation 32: Cash-courier declaration system.
Recommendation 35: Sanctions for non-compliance.
Recommendation 36: Core international conventions.
Recommendations 37-40: International-cooperation Recommendations.
RegTech: Technology that supports regulatory compliance.
Regulated sector: The businesses subject to AML preventive obligations.
Relatives and close associates: A PEP's family and associates, within the PEP framework.
Relatives and close associates (RCAs): A PEP's family and close associates.
Report narrative: The standalone factual account explaining why activity is suspicious.
Request for information: A due-diligence inquiry to clarify activity, framed without revealing suspicion.
Residual risk: Risk remaining after controls are applied to inherent exposure.
Respondent due diligence: A correspondent's due diligence on a respondent bank.
Risk appetite: The risk level the board has formally agreed to carry.
Risk appetite statement (RAS): Board statement of acceptable risk.
Risk assessment: Structured identification and analysis of an institution's ML/TF exposures.
Risk factor: An attribute used in risk scoring, spanning customer, product, channel, and geography families.
Risk-based approach: Allocating AML controls and resources in proportion to assessed risk.
Risk-factor categories: Customer, geography, product, channel.
Role-based training: Training tailored to each role's specific financial-crime risks.
Root cause: The underlying condition that produced the control failures.
Sanctions compliance program: The governed program delivering sanctions compliance.
Sanctions screening: Real-time checking against sanctions lists to prevent prohibited dealings.
Scenario coverage: Whether the right scenarios run where risk flows.
Scenario design: Designing monitoring coverage and thresholds to the institution's assessed risks.
Scenario judgment: Applied judgment identifying the controlling issue and the proportionate action.
Second line of defence: Compliance and risk: framework design, advice, and challenge.
Secondary sanctions: US sanctions pressuring non-US persons via market-access consequences.
Section 311 special measures: Treasury measures vs primary-ML-concern targets.
Section 314(a): FinCEN's law-enforcement record-search channel.
Section 314(b): Voluntary bank-to-bank information sharing.
Sector red flag: Cross-sector indicator of possible laundering.
Sectoral sanctions: Narrow activity bans short of full blocking.
Self-laundering: Laundering your own criminal proceeds.
Senior management approval: Accountable senior sign-off on accepting an identified higher risk.
Senior managing official: The fallback beneficial owner where no natural-person owner is identifiable.
Shell bank: Bank with no physical presence or regulated affiliation.
Ship-to-ship transfer: Mid-sea cargo transfer used to disguise sanctioned origin.
Simplified due diligence: Reduced CDD intensity, conditional on demonstrated lower risk.
Simplified due diligence (SDD): Reduced CDD for lower-risk customers.
Single rulebook: Uniform, directly applicable EU AML rules without national transposition.
Sixth Anti-Money Laundering Directive: The EU directive harmonising ML criminal offences across members.
Source of funds: The origin of the specific money in a transaction or relationship.
Source of wealth: The origin of a customer's total wealth and the activities that built it.
Specially Designated Nationals list: OFAC's primary list of blocked persons and entities.
Standard-setter (FATF): FATF sets standards; countries enforce them.
Straight-through processing (auto-clearing): Auto-deciding cases without review.
Strategic analysis: FIU analysis of aggregate patterns, fed back to reporting institutions.
Strict liability (sanctions): Sanctions liability that attaches without proof of intent or knowledge.
Stripping: Altering payment-message data to defeat sanctions screening.
Structuring: Splitting transactions to evade currency-reporting thresholds.
Structuring scenario: Detecting sub-threshold splitting to evade reporting.
Successor liability: Acquirer inheriting a target's liability.
Supervised vs unsupervised learning: Labelled-outcome learning vs unlabelled anomaly detection.
Suspicion threshold: Reasonable grounds to suspect, not proof.
Suspicious activity report: The US suspicious-activity report, confidential under 31 U.S.C. § 5318(g)(2).
Suspicious transaction report: An institution's report of suspected criminal or terrorist-financing activity to the FIU.
Synthetic identity: A fake identity built from real and invented data.
Tax avoidance: Lawful reduction of tax within the law.
Tax evasion: Illegal non-payment of tax through deception.
Technical compliance: Assessment of whether a jurisdiction's legal framework matches the FATF standards.
Technical compliance vs effectiveness: Right laws vs working system.
Terrorist financing: Funding terrorism, criminal regardless of the funds' lawful origin.
Third line of defence: Internal audit's independent assurance over the program.
Third-party intermediary risk: Bribery routed through agents/consultants.
Third-party reliance: Using another regulated firm's CDD, while keeping ultimate responsibility.
Three lines of defence: The first-line/second-line/third-line risk-governance model.
Tick-box compliance: Paper compliance that does not operate.
Tipping off: Improperly revealing a report or investigation, prejudicing it.
Tipping-off (POCA s333A): Offence of revealing a SAR/investigation.
Tipping-off exceptions: Permitted disclosures that are not tipping off.
Tone from the top: Leadership's signals that set the institution's real compliance culture.
Total cost of ownership: Full lifecycle cost of a tool, not just licence.
Total cost of ownership (TCO): Full lifetime cost of a tool.
Trade-based money laundering: Laundering value through manipulated or fictitious trade.
Transaction monitoring: Scrutinising activity to surface behaviour inconsistent with the customer profile.
Travel rule (virtual assets): Originator and beneficiary information must accompany VASP transfers above threshold.
Trigger event review: Event-prompted out-of-cycle CDD review.
Trigger-event review: Event-driven CDD review outside the periodic cycle.
Trust and company service provider (TCSP): Provider of company-formation and nominee services.
UK Bribery Act: UK anti-bribery statute, no facilitation exception.
Ultimate responsibility (board): Board keeps accountability for the program.
UN sanctions: UN Security Council sanctions, implemented through national law.
Under-invoicing: Pricing goods below value to shift value to the importer.
UNSCR 1373: The post-2001 resolution requiring national TF criminalisation and designation mechanisms.
Unsupervised learning: ML that finds patterns without labels.
Unusual vs suspicious: Investigate the unusual; report the suspicious.
US nexus: A connection drawing a transaction under US sanctions jurisdiction.
USA PATRIOT Act: The 2001 Act expanding US AML obligations, including CIP.
Use limitation (FIU exchange): Shared FIU intelligence needs consent to re-use.
Verification: Confirming identity against reliable, independent sources.
Virtual asset service provider: A regulated provider of virtual-asset services.
Voluntary self-disclosure: Disclosing a violation before discovery, a recognised mitigating factor.
Wallet attribution: Attributing pseudonymous blockchain addresses to real-world actors.
Westpac / AUSTRAC matter: The Australian late-reporting and channel-monitoring matter.
Whistleblower (enforcement context): An internal reporter whose warnings must drive action to matter.
Whitelist (good-guy list): Governed suppression of a known false match.
Wind-down licence: Limited period to exit existing business.
Wire stripping: Deliberately altering payment-message data to evade screening.

Part 4 · Before exam day

How to pass, not just cram

Block out the full exam time without interruption when you sit a full simulation. The clock does not pause.
Read each scenario question twice. The exam tests judgment, so the best answer is usually a close call between two plausible options.
When two answers look right, pick the one that reflects the risk-based approach and the institution’s actual obligation, not the harshest or most literal reading.
Keep clear which source recommends (FATF) and which one requires (national law). The exam separates the global standard from the local statute.
Be able to place every control in the customer lifecycle: onboarding, due diligence, ongoing monitoring, screening, and reporting.
Review the glossary the night before. Most wrong answers come from a term used loosely, not from a gap in reasoning.
Run at least one full simulation under real conditions, and reach the readiness signoff, before exam day.

This is the map. The course is the classroom.

This guide shows you the whole exam. The course teaches every lesson interactively, with a lecturer that adapts to what you know and a faithful simulation that tells you when you are ready.

Start the course

Enso Academy is independent and is not affiliated with, authorised by, or endorsed by the certifying body. This guide is original material built from primary and public sources.