AML - Anti-Money Laundering
Definition
Anti-Money Laundering (AML) is the framework of laws, regulations, and controls designed to prevent the movement of illicit funds through the financial system. It obliges banks to detect, deter, and report suspicious activity by applying rigorous identification, monitoring, and escalation procedures throughout the client lifecycle.
Context
AML provides the regulatory foundation that defines why KYC and CDD exist.
KYC ensures the bank knows who the client is and the purpose of the relationship.
CDD determines how much risk the client presents and how closely they must be monitored.
Together, they operationalise AML obligations within the Client Lifecycle Management (CLM) framework.
Within E-CLM, AML compliance is embedded through rules, workflows, and data controls that govern onboarding, screening, periodic reviews, and exit. AML risk ratings and alerts feed into CNRM analytics to reveal exposure patterns across client networks and geographies.
An effective AML capability depends on high-quality entity data, continuous due diligence, and coordinated responses across compliance, operations, and technology teams—ensuring financial-crime risk is managed as part of integrated client risk governance.
E-CLM - Entity Client Lifecycle Management
Definition
Entity Client Lifecycle Management (E-CLM) is the capability that governs how a bank creates, maintains, and retires client entities across their lifecycle. It ensures a single, high-quality source of entity data that underpins onboarding, KYC, tax, regulatory classification, and offboarding processes.
Context
E-CLM integrates client data, workflow, and control services so that all client-related activities operate from a common, validated entity record. It establishes the foundation for efficiency, consistency, and risk control across business lines and jurisdictions.
KYC - Know Your Customer
Definition
Know Your Customer (KYC) is the process through which a bank verifies the identity of a client, understands the nature of their activities, and assesses potential risks before and throughout the client relationship. It is a regulatory requirement designed to prevent money laundering, terrorism financing, and other forms of financial crime.
Context
KYC sits within the broader Client Lifecycle Management (CLM) capability as the control layer that ensures each client is properly identified and risk-assessed. It differs from Customer Due Diligence (CDD) in scope and purpose—KYC establishes who the client is and why the relationship exists, while CDD extends to ongoing, risk-based monitoring and deeper checks (Enhanced Due Diligence) when required.
In an E-CLM operating model, KYC activities are executed through data collection, validation, and risk scoring workflows, linked directly to the entity record managed under Entity Management. Within CNRM, KYC data contributes to network-level insight, revealing how risks propagate across connected clients and relationships.