What type of transactions does AML sanctions screening primarily target?

Anti-Money Laundering (AML) sanctions screening primarily targets prohibited transactions. AML regulations aim to detect and prevent illicit financial activities that could involve the use of illegal funds or support criminal enterprises. By screening transactions against government-imposed sanctions lists, financial institutions can identify and block transactions that violate regulations and potentially facilitate money laundering or terrorist financing.

Prohibited transactions encompass activities involving individuals, organizations, or countries that are subject to sanctions due to their involvement in illegal activities, such as drug trafficking, human trafficking, or terrorism. The focus of AML screening is, therefore, on identifying these high-risk transactions to mitigate financial crimes.

In contrast, legal and ethical transactions, high-value luxury purchases, or standard banking operations do not primarily fall under the scope of AML sanctions screening, as they typically do not involve the laundering of money or funding of illegal activities.