Glossary

The Paris Agreement is a 2015 international treaty under which nearly all countries committed to hold global warming well below 2 degrees Celsius, and to pursue efforts to limit it to 1.5 degrees.

PCAF is an industry partnership of financial institutions that publishes a common method for measuring and disclosing the greenhouse gas emissions linked to loans and investments.

Passive bribery is the offence committed by the person who asks for, agrees to or accepts a bribe, such as an official or employee who takes money to act improperly.

A payable-through account is held by a foreign bank at a local bank but opened for direct use by the foreign bank's own customers, who can write cheques and move money themselves.

Payment card fraud is the unauthorised or deceptive use of credit, debit or prepaid cards, or their details, to obtain goods, services or cash, whether the card is present or not.

PCI DSS is a security standard, set by the card brands through the PCI Security Standards Council, for any business that stores, processes or transmits payment card data.

A penalty is any punishment imposed on someone who breaks a law or rule: a fine, a ban, loss of a licence or imprisonment, set according to the seriousness of the breach and the offender.

Penetration testing is an authorised, simulated attack on a system, network or application, carried out by skilled testers to find weaknesses that real attackers could exploit before they do.

A performance audit is an independent examination of whether a public programme or activity is run economically, efficiently and effectively, and whether it achieves its intended results for the money spent.

A periodic KYC review is a scheduled re-examination of a customer's file to confirm identity documents, ownership, activity and risk rating are still accurate, with the frequency set by the customer's risk level.

A permanent establishment is a fixed place of business, or certain dependent agents, through which a foreign company operates in a country, giving that country the right to tax the profits attributable to it.

Personal account dealing is the buying and selling of securities by staff for their own accounts, together with the firm's rules limiting it so employees cannot profit from confidential information or clients' orders.

Personal data is any information about a living person who is named or could be picked out, whether through an obvious detail like a name or an indirect one such as an account number, location history or online identifier.

Petty corruption is everyday bribe-taking by lower-ranking officials. The sums are small, but the person asking controls a counter, a form or a stamp that someone needs, as with a licence or a fine.

Pharmacovigilance is the monitoring of medicines for harm: collecting reports of side effects, judging whether a drug caused them and acting to reduce the risk, both in trials and after launch.

Phishing is a deceptive message, by email, phone call or text, that poses as a trusted sender to trick people into revealing information, installing malware or making a payment.

Phoenixing is the practice of deliberately running a company into insolvency to avoid debts, then carrying on the same business through a new company, usually under the same control.

Physical climate risk is the risk of damage and loss from climate hazards, either sudden events such as floods and storms or slow shifts such as rising seas and sustained heat.

A pig butchering scam is a long-running confidence fraud in which the criminal builds trust with a victim, often through a romantic or friendly relationship online, then persuades them to put growing sums into a fake investment.

Pillar Two is an OECD-led set of rules that makes large multinational groups pay an effective tax rate of at least 15% in every country where they operate, topping up any shortfall.

Placement is the first stage of money laundering, in which cash or other criminal proceeds are put into the financial system or converted into other assets so that they can be moved and used.

A policy framework is the organised structure of an organisation's policies, standards and procedures, with defined owners, approval routes and review cycles, so rules are consistent, findable and kept up to date.

This is the risk that a donation to a political party, candidate, charity or community cause is used, or seen as being used, to disguise a bribe or to win an improper advantage.

Political corruption is the misuse of public power by politicians or officials to gain personal or party advantage, including vote buying, illicit campaign funding, trading favours for donations and abuse of public office.

A politically exposed person is someone who holds, or has recently held, a prominent public role, and who is treated as higher risk for bribery, corruption and misuse of public funds because of their position.

A Ponzi scheme is an investment fraud in which the operator settles old investors' claims out of fresh deposits from new ones, so promised profits are never earned, and it fails once new money slows.

Pool trading is an old manipulation scheme in which a group of traders agrees to trade a stock among themselves and with the public, lifting its price and activity, then sells their holdings at the higher level.

Port denial is a sanctions measure that refuses chosen vessels entry to a country’s ports and its services, such as docking, fuel and repair, usually because the ship is listed or linked to sanctioned trade.

A post-incident review is a structured look back at a security or operational incident, after it is resolved, to establish what happened, why, how well the response worked and what must change.

A predicate offence is the underlying crime that generates the money or property later laundered, such as fraud, corruption, drug trafficking or tax crime. Without one, there is nothing to launder.

Preventive controls are measures that stop an error, loss or breach from happening in the first place, such as approvals, access restrictions, training and system blocks.

Price fixing is an agreement between competitors to set, raise, hold or coordinate prices or the terms of sale, instead of each deciding independently. It is treated as a core cartel offence.

Primary sanctions are the prohibitions a country applies to its own citizens, companies and activity within its territory, forbidding them from dealing with a targeted country, entity or person.

Least privilege is the rule that every person, account or application gets the smallest set of permissions that lets it do its job, and keeps them only while the need lasts.

The Principles for Responsible Banking are a voluntary United Nations framework, launched in 2019, in which signatory banks commit to align their strategy and lending with society's goals and the Paris Agreement.

The Principles for Responsible Investment are a voluntary set of six principles, backed by the United Nations, under which investors commit to take ESG issues into account in their investment and ownership practices.

Principles-based regulation sets broad standards of expected behaviour or outcomes, leaving firms to decide how to meet them, in contrast to rules-based regulation that prescribes detailed steps.

Privacy by design means building data protection into products, systems and processes from the start. Privacy by default means the most protective settings apply automatically, without the user having to choose them.

A privacy notice is the statement an organisation gives people to explain what personal data it collects, why, how it is used and shared, how long it is kept, and what rights they have.

Privileged access management is the set of tools and rules that control, record and limit the use of powerful accounts, such as system administrators, database owners and service accounts.

Probability of default is the estimated chance that a borrower will fail to meet its debt obligations within a stated period, most often one year. It is expressed as a percentage.

Proceeds of crime are money or property obtained directly or indirectly from committing an offence, including later gains from reinvesting the original funds.

Process safety management is a structured system for controlling the hazards of processes that handle dangerous substances, so as to prevent fires, explosions and toxic releases that can harm many people at once.

Procurement fraud is dishonest conduct in buying goods or services, such as rigging bids, taking kickbacks, favouring a supplier improperly or submitting false invoices, to gain advantage or cause loss to the buyer.

Product governance is the set of rules and decisions a firm uses to design, approve, sell and review its products so that they meet the needs of an identified customer group and avoid foreseeable harm to them.

Product safety is the legal and practical duty of manufacturers, importers and sellers to place only products on the market that do not put users at unreasonable risk of injury or harm.

Professional enablers are lawyers, accountants, advisers, company formation agents and similar professionals who knowingly or negligently help criminals hide, move or legitimise money, using their skills and trusted position.

A professional money launderer is an individual or organisation that launders criminal funds for others in return for a fee or commission, usually without having taken part in the underlying crime.

Professional scepticism is a questioning attitude in which a reviewer stays alert to error and fraud and weighs evidence critically, rather than taking explanations at face value.

A prohibition order is a regulator's decision barring a person from working in a regulated industry, or from holding certain roles, usually because they are found not fit and proper or have committed serious misconduct.

Project risk management is the practice of identifying, assessing and responding to uncertain events that could help or harm a project's cost, schedule, scope or quality, from planning through delivery.

Proliferation financing is providing funds or financial services that help a state or group obtain, make, move or use nuclear, chemical or biological weapons and the goods needed to deliver them.

A proliferation financing risk assessment is a structured exercise to identify how a country or firm could be used to fund weapons proliferation, judge how likely and serious that is, and decide what controls to apply.

A protected disclosure is a report of wrongdoing, made in the way the law or policy requires, that earns the person making it legal protection against dismissal, harassment or other retaliation.

Provisional attachment is a temporary order that stops a person from selling, moving or using property that may be criminal proceeds, so that it remains available if a court later orders confiscation.

Prudential regulation is the set of rules that keep financial firms financially sound, covering capital, liquidity, risk management and governance, so they can survive losses and protect depositors, policyholders and the wider system.

Pseudonymisation replaces direct identifiers in a record, such as a name, with a code, and keeps the key that links the code back to the person separately and under tight control.

Public accountability is the duty of governments, public bodies and those who handle public money or power to explain and justify their decisions and results to citizens, and to face consequences if they fall short.

Public financial management is the set of laws, processes and systems a government uses to plan its budget, collect and spend money, record and report transactions, and be held to account for the results.

Public naming and shaming is a regulator's practice of publishing the identity of a firm or person that broke the rules, relying on reputational damage as a sanction and a warning to others.

Public procurement governance is the set of rules, institutions and checks that guide how public bodies buy goods, works and services, so that contracts are awarded fairly, openly and at good value.

In a pump and dump, promoters buy a cheap security, talk its price up with misleading hype, and sell into the buying that follows, leaving latecomers with losses.

This is the due diligence step of finding out why a customer wants the relationship and what kind of activity is expected, so that later transactions can be compared with a clear baseline.

Purpose limitation is the principle that personal data should be gathered for a clear, stated and lawful reason and not reused for something that does not fit that reason.

A pyramid scheme is a scam in which participants pay to join and earn mainly by recruiting others who also pay, rather than from any real product or service, so it collapses once recruitment slows.