Financial Crime World

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Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT)

This article provides an overview of key definitions related to AML and CFT. We will break down each definition, highlighting their significance in preventing money laundering and terrorist financing.

Politically Exposed Person (PEP)

A Politically Exposed Person (PEP) is a natural person holding a prominent public function. This includes:

  • Heads of state or government
  • Members of their families
  • Senior politicians
  • Judges and prosecutors with significant independence
  • Military officers with significant command responsibilities
  • High-ranking government officials and administrators
  • Ambassadors, consuls, chargés d’affaires, and high-ranking officers in the armed forces
  • Members of the administrative, management, or supervisory bodies of State-owned enterprises
  • Directors, deputy directors, and members of the board or persons in an equivalent function of an international organisation

Family Member

A Family Member is defined as:

  • Spouse or person considered to be equivalent to a spouse
  • Children and their spouses (or persons considered to be equivalent to a spouse)
  • Parents

Persons Known to Be Close Associates

Persons Known to Be Close Associates are natural persons known to have joint beneficial ownership of a legal entity referred to in the list, or are known to have any other close business relations with a PEP. They also include:

  • Natural persons who have sole beneficial ownership of a legal entity referred to in the list (a), b), c), or d), which is known to have been set up for the de facto benefit of a PEP

Senior Management

Senior Management refers to an officer or an employee with sufficient knowledge of the institution’s money laundering and terrorist financing risk exposure and sufficient seniority to take decisions affecting its risk exposure, without necessarily being a member of the legal management body.

International Organisation

An International Organisation is defined as:

  • An association of means or interests established by means of an international agreement between States, with joint bodies if necessary, with legal personality and subject to a legal system which is different from the one of its members

Business Relationship

A Business Relationship is a professional or commercial relationship with a customer expected to have an element of duration. This includes:

  • Through the conclusion of a contract under which several successive operations are carried out between the parties during a specific or indefinite period, or which gives rise to permanent obligations
  • Through regular requests by the same customer for the intervention of the obliged entity to carry out successive operations

Correspondent Relationship

A Correspondent Relationship is the provision of banking services by an obliged entity (e.g., providing a current or other liability account and related services like cash management, international funds transfers, cheque clearing, payable-through accounts, and foreign exchange services). It also includes business relationships similar in nature between the obliged entities and financial institutions governed by the law of a third country.

Electronic Money

Electronic Money is electronic money within the meaning of Article 2, 77°, of the Law of 11 March 2018, excluding the monetary value issued in accordance with Articles 164 and 165 of said Law.

Virtual Currencies

A Virtual Currency is a digital representation of value that is not issued or guaranteed by a central bank or a public authority, is not necessarily attached to a legally established currency, and does not possess a legal status of currency or money but is accepted by natural or legal persons as a means of exchange and can be transferred, stored, and traded electronically.

Custodian Wallet Provider

A Custodian Wallet Provider is an entity that provides services to safeguard private cryptographic keys on behalf of its customers, to hold, store, and transfer virtual currencies.

Games of Chance

Games of Chance are games of chance within the meaning of Article 2 of the Law of 7 May 1999 on games of chance.