AML and KYC glossary for Canada

CAMLO stands for Chief Anti-Money Laundering Officer, the compliance officer of record accountable for a firm's AML program in Canada. It is the named role a reporting entity designates to own the program: overseeing policies, monitoring, screening, and reporting, and standing as the point of accountability when FINTRAC examines the firm. The role can be filled in-house or, particularly for smaller firms without a full compliance department, engaged on a fractional basis, where an external practitioner carries the CAMLO responsibility part-time rather than as a full-time employee. Either way, the accountability is real: the CAMLO is the person a regulator holds responsible for whether the AML program is reasonably designed and actually operating. Naming a CAMLO is a baseline expectation of a Canadian compliance program, not an optional refinement, which is why the term recurs so often across FINTRAC guidance and in the other reporting obligations covered in this glossary.

KYC, Know Your Customer, is the process of verifying the identity of an individual customer before and during a business relationship, and in Canada it has to be done by a FINTRAC-accepted method. KYB, Know Your Business, is the equivalent process for a corporate customer: it means verifying the entity itself, identifying and verifying its beneficial owners, and screening the resulting structure. The core difference is layers. Verifying an individual is a single-subject check, but a company can be owned and controlled through several other companies, so KYB has to trace ownership up through that structure to reach the real humans who ultimately own or control the customer. That is why KYB carries more steps and more room for discrepancy than KYC. Both sit at the front of a compliance program, and both feed the screening and ongoing monitoring that follow, but KYB answers a harder question about who is really behind a business.

A PEP, or politically exposed person, is someone entrusted with a prominent public function, who is treated as carrying higher money-laundering risk because of the position they hold. Identifying a PEP does not by itself bar the relationship; it triggers enhanced measures, the closer scrutiny a compliance program applies to higher-risk customers. In the language of this glossary, that maps to enhanced due diligence, the more rigorous assessment reserved for higher-risk customers rather than the standard customer due diligence applied to everyone. PEPs are identified through screening, and in a Canadian program that screening runs alongside sanctions screening and adverse-media screening as part of the same review. The practical takeaway is that a PEP finding is a signal to look more closely and apply enhanced due diligence, not an automatic reason to refuse the customer, which is what separates a PEP result from a sanctions match, where the obligation is a strict one.