Risk-Based Approach to AML

A risk-based approach to Anti-Money Laundering (AML) means that financial institutions assess and prioritize their efforts based on the level of risk associated with different customers, transactions, or regions. Instead of applying the same checks to everyone, they focus more attention on higher-risk cases—like those involving large or unusual transactions, or clients from high-risk countries. This approach helps them efficiently prevent money laundering by allocating resources where the danger is greatest, while still maintaining overall compliance and security.