Anti-Money Laundering (AML) Policy Template

# Anti-Money Laundering (AML) Policy Template **Prepared by:** [COMPANY NAME] **Effective Date:** [DATE] **Document Version:** 1.0 **Classification:** CONFIDENTIAL / INTERNAL USE ONLY **Policy Owner:** Chief Compliance Officer / Designated AML Officer **Review Cycle:** Annual (or upon material regulatory change) --- ## Table of Contents - 1.0 Purpose and Scope - 2.0 Definitions and Interpretive Guidance - 3.0 Regulatory Framework and Legal Obligations - 4.0 AML Program Structure and Governance - 5.0 Customer Due Diligence (CDD) and Know Your Customer (KYC) Requirements - 6.0 Transaction Monitoring and Suspicious Activity Reporting - 7.0 Recordkeeping Requirements - 8.0 Employee Training and Awareness - 9.0 Sanctions Compliance and OFAC Screening - 10.0 Third-Party and Correspondent Relationships - 11.0 Enforcement, Disciplinary Measures, and Internal Audit - 12.0 Appendices - 13.0 Document Control --- ## 1.0 Purpose and Scope ### 1.1 Purpose This Anti-Money Laundering Policy ("Policy") establishes the compliance framework, operational procedures, and governance standards by which [COMPANY NAME] ("the Company") detects, prevents, and reports activities that may constitute money laundering, terrorist financing, or other financial crimes prohibited under applicable federal and state law. The Company is committed to full compliance with all applicable anti-money laundering statutes, regulations, and guidance issued by relevant regulatory bodies, including but not limited to the Bank Secrecy Act (BSA), 31 U.S.C. §§ 5311–5336, as amended by the USA PATRIOT Act of 2001 and the Anti-Money Laundering Act of 2020 (AMLA 2020), Title II of the National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283). This Policy is designed to ensure that the Company does not knowingly or inadvertently facilitate money laundering, terrorist financing, or violations of economic sanctions administered by the Office of Foreign Assets Control (OFAC). This Policy reflects the Company's recognition that money laundering and terrorist financing pose serious risks not only to the Company's business, reputation, and legal standing, but to the integrity of the financial system and national security broadly. Accordingly, compliance with this Policy is a condition of continued employment and engagement for all personnel subject to its terms. ### 1.2 Scope This Policy applies to: **(a)** All employees, officers, directors, managers, and members of [COMPANY NAME], regardless of employment classification, including full-time, part-time, temporary, and contracted personnel; **(b)** All subsidiaries, affiliates, and related entities over which [COMPANY NAME] exercises operational control or ownership of fifty percent (50%) or more; **(c)** All agents, brokers, independent contractors, and third-party service providers acting on behalf of or in concert with [COMPANY NAME] in connection with its business activities; **(d)** All financial transactions, customer relationships, products, services, and business channels operated or managed by [COMPANY NAME], including digital, electronic, and cash-based channels. ### 1.3 Policy Authority This Policy is issued under the authority of the Board of Directors of [COMPANY NAME] and is subject to annual review by the Compliance Committee. The Chief Compliance Officer (CCO), or designated AML Compliance Officer, is responsible for administering, interpreting, and enforcing this Policy. Questions regarding the application or interpretation of this Policy should be directed to the AML Compliance Officer at [COMPLIANCE CONTACT EMAIL / PHONE]. ### 1.4 Relationship to Other Policies This Policy should be read in conjunction with the following Company policies and procedures: - Know Your Customer (KYC) Procedures Manual - Sanctions Screening Procedures - Data Privacy and Information Security Policy - Whistleblower and Non-Retaliation Policy - Vendor and Third-Party Risk Management Policy - Code of Business Conduct and Ethics In the event of any conflict between this Policy and applicable law or regulation, applicable law or regulation shall govern. In the event of any conflict between this Policy and another internal policy, this Policy shall take precedence for matters related to AML compliance unless otherwise directed by the CCO in writing. --- ## 2.0 Definitions and Interpretive Guidance For purposes of this Policy, the following terms shall have the meanings set forth below. Where a term is defined differently under applicable law or regulation, the statutory or regulatory definition shall control for purposes of compliance obligations. **2.1 "Anti-Money Laundering (AML)"** means the set of laws, regulations, procedures, and controls designed to prevent the generation of income through illegal actions and the process by which illegally obtained funds are disguised to appear legitimate. **2.2 "Bank Secrecy Act (BSA)"** means the Currency and Foreign Transactions Reporting Act, 31 U.S.C. §§ 5311–5336, and its implementing regulations at 31 C.F.R. Chapter X, which establishes recordkeeping and reporting requirements for financial institutions and certain other businesses. **2.3 "Beneficial Owner"** means, with respect to a legal entity customer, each natural person who (i) directly or indirectly owns twenty-five percent (25%) or more of the equity interests of the entity; or (ii) exercises significant managerial control over the entity, consistent with the requirements of 31 C.F.R. § 1010.230 and FinCEN's beneficial ownership rules, including those finalized pursuant to the Corporate Transparency Act (CTA), 31 U.S.C. § 5336. **2.4 "Currency Transaction Report (CTR)"** means the report required by 31 U.S.C. § 5313 and 31 C.F.R. § 1010.310 for cash transactions exceeding $10,000 in a single business day, whether conducted as a single transaction or multiple transactions that the Company knows, suspects, or has reason to believe are structured to evade reporting requirements. **2.5 "Customer Due Diligence (CDD)"** means the process by which the Company identifies, verifies, and monitors customer information to assess and manage the risk of money laundering, terrorist financing, or other financial crime, in accordance with 31 C.F.R. § 1020.210 and related FinCEN guidance. **2.6 "Enhanced Due Diligence (EDD)"** means the additional measures applied to customers, transactions, or business relationships that present a higher risk of money laundering or terrorist financing, including but not limited to senior foreign political figures, Politically Exposed Persons (PEPs), high-risk jurisdictions, and complex or unusual business structures. See Section 5.4. **2.7 "Financial Action Task Force (FATF)"** means the intergovernmental body that establishes international standards for combating money laundering, terrorist financing, and the proliferation of weapons of mass destruction, as reflected in the FATF Forty Recommendations and related guidance documents. **2.8 "Financial Crimes Enforcement Network (FinCEN)"** means the bureau of the U.S. Department of the Treasury responsible for collecting and analyzing information about financial transactions in order to combat domestic and international money laundering, terrorist financing, and other financial crimes. **2.9 "High-Risk Customer"** means a customer whose profile, geographic location, transaction behavior, business type, or other attributes indicate an elevated risk of money laundering or financial crime as determined pursuant to the Company's risk-based assessment methodology described in Section 4.3. **2.10 "Know Your Customer (KYC)"** means the process of identifying and verifying the identity of customers and understanding the nature and purpose of customer relationships, as required under applicable law and described in Section 5.0 of this Policy. **2.11 "Money Laundering"** means any act or attempted act to disguise the source, ownership, or control of proceed