Along with the development carried out by the Indonesian government, capital markets are needed as one means of sustaining the constant development of economic growth. In spite of this, it is often the case that in the development of capital markets, the economic sector has become targeted as one of the myriad areas in which conduct of money laundering prevails, causing many investors hesitant to invest. Money laundering itself can occur either through the capital market crime itself, or through the predicate offense. Given the importance of preventing money laundering in capital markets, the Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) as supervisors and operators in the capital markets has implemented one of the principles that was previously known in the banking world as Know Your Customer Principles as a way to prevent money laundering in the capital market. In this thesis, the writer will use a variety of theories and prevailing rules of legislation in order to make an analysis and draw a conclusion of how Know Your Customer principles can be effective to prevent money laundering from occuring through the help of PPATK.