Combating the Financing of Terrorism (CFT)

In the banking world, CFT means having systems in place to spot and stop suspicious financial activity that could be linked to terrorism. This includes:

• Monitoring international wire transfers
• Flagging high-risk customers or countries
• Screening transactions against watchlists and sanctions lists

Banks are on the front lines when it comes to CFT. Regulators expect them to know where money is coming from and where it’s going—and to raise the alarm if something doesn’t look right.

In a compliance context, CFT is part of a broader regulatory framework that includes AML. Companies—especially those in finance, crypto, or payments—are required to:

• Conduct risk assessments on clients and partners
• Implement due diligence procedures (KYC/KYB)
• Report suspicious transactions to authorities (via SARs or STRs)
• Train staff to recognize red flags

CFT compliance isn’t just about ticking boxes—it’s about protecting your business and helping disrupt criminal networks.

CFT and AML go hand in hand. AML (Anti-Money Laundering) focuses on stopping money from illegal sources (like drug trafficking or corruption), while CFT focuses on how that money might be used to fund terrorism.

So, in simple terms:

• AML = Stop dirty money
• CFT = Stop money from getting to terrorists

Both share tools like transaction monitoring, customer screening, and regulatory reporting. Together, they form the backbone of financial crime prevention in most jurisdictions around the world.