What is the difference between source of wealth and source of funds?

Source of wealth provides a snapshot of the overall financial profile of an applicant for business or customer, whereas source of funds is more narrowly focused and helps FIs and DNFBPs to verify the legitimacy of funds to be used for a specific business relationship or transaction. As an example, source of funds for an investment holding company may be proceeds of a property sale by the beneficial owner. Whereas the beneficial owner’s source of wealth may include employment and investment income.