Anti-Money Laundering (AML)
Programs required by the Bank Secrecy Act and USA PATRIOT Act to detect money laundering through its three stages — placement (cash enters the system), layering (transactions hide the trail), and integration (funds re-emerge clean).
A favorite question asks who owns the rules: AML lives under the Bank Secrecy Act and USA PATRIOT Act, with regulations written by FinCEN (a Treasury bureau), while sanctions screening runs against the OFAC/SDN list — a parallel Treasury duty (OFAC, not FinCEN, administers the blocked-persons list). The pillar question wants the four program elements, but the deeper trap is confusing the program with the filings it produces.
AML is the umbrella; a CTR (cash over $10,000 in a day) and a SAR (suspicious activity of $5,000+, filed within ~30 days, and the customer is never tipped off) are the outputs. Don’t mix it with CIP, which only collects and verifies identity at account opening, or Reg S-P, which is privacy — not laundering. And know that structuring — splitting deposits under the threshold to dodge a report — is itself a federal crime, even when no single transaction breaches the limit.
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