# Set Policies

The transaction policy is one of Fordefi's major security features, governing
how transactions are approved before being signed and broadcast to the
blockchain. The policy rules can be highly granular, allowing customization
based on transaction attributes such as amount, origin, destination, and user.
The approval process itself is customizable - administrators can define whether
transactions require approval from a minimum number of approvers or from
specific combinations of approver groups, or alternatively, can configure the
system to automatically approve or block transactions based on predefined
criteria.

For example, an organization may want to automatically block a transaction that
exceeds a specific amount, review transactions according to their origin, or
block specific users from making transactions.

## AML policies

Fordefi also allows admins to set AML policies: actions to be taken in case of
an alert from the AML provider configured in their organization.
[Learn more](/user-guide/aml/aml-policies).

## Policy structure

The policy consists of an ordered list of rules. Each rule has a set of
conditions and an action. When a transaction is created, the policy is evaluated
according to the order of the rules. The first rule that matches the transaction
is applied. Therefore, if two policy rules match a transaction but contradict
each other, the policy rule higher in the list overrides the policy rule that
appears lower in the list. For example, if both Policy Rule number 4 and Policy
Rule number 7 match a transaction, the rule with number 4 will be applied.

To match a rule, the transaction must satisfy all the conditions of the rule.
When all the conditions are met, the rule is applied to the transaction and the
preassigned action is taken. If the transaction does not satisfy all the
conditions of the rule, the rule is not applied and the policy proceeds to
evaluate the next rule.

The last rule in the policy is the default policy rule. The default rule is a
bit different from other rules. First, it cannot be deleted or moved, and
second, all its conditions are set to `Any` and cannot be changed. As a result,
the default rule is a fallback rule that will always be applied if no other rule
matches.

 To
enable organizations to start working quickly, Fordefi's factory policy settings
require no approvals at all. Our recommendation is to modify the default
rule—either block or require approval. 

## Basic example

Suppose you wish to have Fordefi automatically process a transaction up to $1000
and require two approvals for any transaction that exceeds that amount. You
would then create a policy that consists of two rules:

1. A rule that has its "Transaction Amount" condition set to "≤ $1000" to allow
transactions up to $1000.
2. Below it, the default rule with its action set to "Require Approval".


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Learn more:

- [How to create a policy rule](/user-guide/policies/create-a-policy-rule)
- [About rule conditions and actions](/user-guide/policies/policy-rules-conditions-and-actions)
- [Message signing policy](/user-guide/policies/message-policy)
- [How to modify the Admin Quorum](/user-guide/admin-quorum)
- [Sample policies](/user-guide/policies/sample-policies)
- [Best practices for Fordefi policies](/user-guide/policies/best-practices)