The following is my answer to a Quora question: “What is the difference between KYC and anti-money laundering?”
KYC refers to “Know Your Client”, a set of guidelines financial institutions have to adhere to in order to establish, beyond reasonable doubt, the identity of the client, the suitability of the product or service recommended, the risk profile, the client knowledge of the product and market, and the source of funds and wealth. The KYC is part of the anti-money laundering process, which covers the entire spectrum of fund acquisition, accumulation, placement, and disbursement. KYC is the first step in the AML policy.
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