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ACAMS CAMS (Certified Anti-Money Laundering Specialists) exam is a globally recognized certification for professionals in the anti-money laundering (AML) field. Certified Anti-Money Laundering Specialists certification demonstrates a deep understanding of the AML framework, laws, regulations, and best practices to detect and prevent money laundering and terrorist financing activities.
NEW QUESTION # 379
A professional dealer in precious metals and stones in an EU country plans to implement measures to reduce the risk of being misused for money laundering purposes. Which measures are most relevant for achieving this goal? (Select Two.)
- A. Limit the acceptance of purchases without adequate customer identification information.
- B. Limit direct contact between customer and employees.
- C. Stop accepting payments from persons other than the beneficiary.
- D. Stop accepting cash payments in currencies other than Euro.
- E. Only accept trades related to precious metal pool accounts maintained by sophisticated precious metal companies.
Answer: A,C
Explanation:
Explanation
The two most relevant measures for a professional dealer in precious metals and stones to reduce the risk of being misused for money laundering purposes are:
Stop accepting payments from persons other than the beneficiary: This measure can help to ensure that the source of funds is legitimate and can be traced back to the customer.
Limit the acceptance of purchases without adequate customer identification information: Adequate customer identification information is necessary for the purpose of identifying and verifying the customer's identity and determining whether the customer is a politically exposed person (PEP) or has any other risk characteristics that may require enhanced due diligence measures.
NEW QUESTION # 380
Which three procedures should a compliance officer looking to revise an institution's CTF efforts include in accordance with the Wolfsberg Group's Statement on the Suppression of the Financing of Terrorism?
- A. Consulting applicable lists and taking appropriate actions to determine if customers appear on such lists
- B. Maintaining customer information to facilitate timely retrieval of such information
- C. Reporting matches from lists of known or suspected terrorists to relevant authorities
- D. Reviewing only original identification documents when verifying customers
Answer: A,B,C
Explanation:
According to the Wolfsberg Group's Statement on the Suppression of the Financing of Terrorism1, a compliance officer should include the following three procedures in revising an institution's CTF efforts:
Consulting applicable lists and taking appropriate actions to determine if customers appear on such lists. This procedure is important to prevent terrorist organizations from accessing the financial services of the institution and to comply with the sanctions and regulations imposed by competent authorities. The compliance officer should implement procedures for checking the customers against the lists of known or suspected terrorists or terrorist organizations issued by relevant authorities and taking reasonable and practicable steps to verify the identity and status of the customers.
Reporting matches from lists of known or suspected terrorists to relevant authorities. This procedure is important to assist the authorities in their efforts to detect and disrupt terrorist financing and to fulfill the legal obligations of the institution. The compliance officer should report to the relevant authorities any matches from the lists of known or suspected terrorists or terrorist organizations consistent with the applicable laws and regulations regarding the disclosure of customer information.
Maintaining customer information to facilitate timely retrieval of such information. This procedure is important to enable the institution to respond promptly and effectively to the enquiries and requests from the authorities and to enhance the quality and accuracy of the customer data. The compliance officer should explore ways of improving the maintenance of customer information to facilitate the timely retrieval of such information.
Wolfsberg Statement on Anti-Terrorism Financing
UNUSUAL CUSTOMER IDENTIFICATION CIRCUMSTANCES
* Customer furnishes unusual or suspicious identification documents or declines to produce originals for verification."
NEW QUESTION # 381
A Money Laundering Reporting Officer's (MLRO) lack of action led to deficiencies in the bank's AML program and a civil monetary penalty being levied against the MLRO. Why was this direct action taken against the MLRO?
- A. The MLRO agreed to the civil penalty so that the bank would not be found liable for the AML program deficiencies.
- B. MLROs can be held to an individual accountability standard and face potential penalties for contributing to AML program deficiencies.
- C. The MLRO is the only individual that can be held responsible for AML program deficiencies.
- D. Action was brought against the MLRO because banks cannot be found liable for AML program deficiencies.
Answer: B
Explanation:
MLROs are responsible for implementing and enforcing an appropriate risk-based approach for their firm, ensuring compliance with the relevant laws and regulations, and reporting any suspicious activities to the authorities. If they fail to discharge their duties, they may face personal liability and civil or criminal sanctions. MLROs are not the only individuals that can be held responsible for AML program deficiencies, as other seniormanagers, directors, or partners may also be liable depending on their role and involvement.
However, MLROs are often the primary focus of enforcement actions due to their specific responsibilities and obligations. MLROs cannot avoid liability by agreeing to a civil penalty, as this does not absolve them from their legal duties or potential criminal prosecution. Banks can also be found liable for AML program deficiencies and face fines, penalties, or other sanctions.
:
Technical factsheet The role of the money laundering reporting officer
Consequences of not complying | AUSTRAC
Money Laundering Reporting Officer: The Role Of MLRO
FinCEN Penalizes U.S. Bank Official for Corporate Anti-Money Laundering Failures
NEW QUESTION # 382
Which is a valid extraterritorial effect of the USA PATRIOT Act?
- A. Any deposits into foreign banks are not considered to have been deposited into any interbank account the foreign bank may have in the US.
- B. Financial institutions are allowed to specifically direct client transactions that move their funds into, out of, or through an internal bank concentration account ^
- C. Foreign branches of US banks can maintain correspondent accounts with banks that do not have a physical presence in any country.
- D. Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country.
Answer: D
Explanation:
Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country. The USA PATRIOT Act has an extraterritorial effect in that it prohibits broker-dealers from having correspondent accounts with foreign banks that do not have a physical presence in any country. This rule is designed to help prevent money laundering and terrorist financing by making it more difficult for funds to be moved to or through jurisdictions with less stringent anti-money laundering laws.
NEW QUESTION # 383
What kind of person should perform the independent testing of an institution's anti-money laundering program?
- A. A certified specialist in the anti-money laundering field
- B. A retired government regulator or federal law enforcement officer
- C. A former anti-money laundering officer from a similar institution
- D. A person who reports directly to the Board of Directors or a Board Committee
Answer: D
Explanation:
According to the Anti-Money Laundering Specialist (the 6th edition) by ACAMS, the independent testing of an institution's anti-money laundering program should be conducted by a person who reports directly to the Board of Directors or a Board Committee. This ensures that the person conducting the testing has the necessary authority, independence, and objectivity to evaluate the program's adequacy and effectiveness, and to report any findings or recommendations to the senior management1. The person conducting the testing should also have the appropriate knowledge, skills, and experience in the anti-money laundering field, and should be familiar with the institution's products, services, customers, and risks2.
The other options are not necessarily suitable or qualified to perform the independent testing of an institution's anti-money laundering program. For example:
A certified specialist in the anti-money laundering field may have the relevant expertise and credentials, but may not have the required independence or reporting line to conduct the testing. For instance, if the certified specialist is an employee of the institution who is involved in the implementation or operation of the anti-money laundering program, then there may be a conflict of interest or a lack of objectivity in the testing process1.
A former anti-money laundering officer from a similar institution may have the relevant experience and background, but may not have the current knowledge or familiarity with the institution's anti-money laundering program, policies, procedures, or systems. Moreover, the former anti-money laundering officer may have a personal or professional relationship with the institution or its staff, which may compromise the independence or integrity of the testing process1.
A retired government regulator or federal law enforcement officer may have the relevant authority and credibility, but may not have the specific skills or qualifications to conduct the testing. For instance, the retired regulator or law enforcement officer may not be well-versed in the latest anti-money laundering standards, regulations, or best practices, or may not be able to apply them to the institution's unique risk profile, products, services, or customers1.
References:
Anti-Money Laundering Specialist (the 6th edition) by ACAMS
What Is An AML Compliance Program? | ComplyAdvantage
NEW QUESTION # 384
Potential indicators of money laundering associated with Trust and Company Service Providers include:
(Select Two.)
- A. frequent deposits to or withdrawals from bank accounts.
- B. use of legal persons in jurisdictions with strict secrecy laws.
- C. multi-jurisdictional wire transfers with no legal purpose.
- D. structuring cash deposits into third party accounts.
- E. generation of rental income to legitimize illicit funds.
Answer: B,C
Explanation:
Explanation
This is stated in the Certified Anti-Money Laundering Specialist (the 6th edition) manual on page 595, which states: "Potential indicators of money laundering associated with Trust and Company Service Providers include the use of legal persons in jurisdictions with strict secrecy laws, structuring cash deposits into third party accounts, multi-jurisdictional wire transfers with no legal purpose, and frequent deposits to or withdrawals from bank accounts."
NEW QUESTION # 385
In the summer, an institution identifies anti-money laundering concerns regarding a customer's account activity. The customer, an ice cream, has deposited a lot of checks drawn on banks in foreign countries, sent large number of high dollar international wires to different countries, made cash deposits of a few hundred dollars every few days and written multiple checks for a few hundred dollars to the same dozen payees every two weeks.
Which two transaction types warrant investigation? (Choose two.)
- A. Repeated checks to the same payees
- B. The wires to foreign countries
- C. Checks drawn on banks in foreign countries
- D. Regular cash deposits
Answer: B,C
Explanation:
According to the ACAMS Study Guide 6th Edition, Chapter 2, page 36, one of the methods that financial institutions can use to identify suspicious or unusual activity is to monitor transactions for red flags or indicators of money laundering or terrorist financing. Some of the common red flags are:
* Transactions that are inconsistent with the customer's profile, business, or source of funds
* Transactions that involve high-risk countries or jurisdictions, especially those with weak or inadequate anti-money laundering regulations, or those known to be sources or destinations of illicit funds
* Transactions that involve the use of complex or unusual financial instruments or structures, such as multiple accounts, intermediaries, or offshore entities, that have no apparent economic or lawful purpose
* Transactions that involve the use of large amounts of cash, checks, or monetary instruments, especially if they are structured or aggregated to avoid reporting or recordkeeping requirements
* Transactions that involve the use of third parties or nominees, such as relatives, associates, or shell companies, to conceal the identity, ownership, or control of the funds or assets Option B is a transaction type that warrants investigation, as it involves sending large number of high dollar international wires to different countries, which could indicate that the customer is involved in layering or integration stages of money laundering, where the illicit funds are moved across borders and disguised as legitimate transfers. This transaction type also raises the risk of exposure to sanctions, terrorist financing, or other illicit activities, depending on the destination and purpose of the wires.
Option D is also a transaction type that warrants investigation, as it involves depositing a lot of checks drawn on banks in foreign countries, which could indicate that the customer is involved in placement or layering stages of money laundering, where the illicit funds are introduced into the financial system or converted into other forms of value. This transaction type also raises the risk of exposure to fraud, counterfeit, or forgery, depending on the origin and authenticity of the checks.
Option A is not a transaction type that warrants investigation, as it involves making regular cash deposits of a few hundred dollars every few days, which could be consistent with the customer's profile, business, or source of funds, especially if the customer is an ice cream vendor who operates in cash. This transaction type does not raise any red flags of money laundering or terrorist financing, unless there is evidence that the cash deposits are structured or aggregated to avoid reporting or recordkeeping requirements.
Option C is also not a transaction type that warrants investigation, as it involves writing multiple checks for a few hundred dollars to the same dozen payees every two weeks, which could be consistent with the customer's profile, business, or source of funds, especially if the payees are suppliers, employees, or contractors of the customer. This transaction type does not raise any red flags of money laundering or terrorist financing, unless there is evidence that the checks are used to facilitate illicit activities, such as bribery, kickbacks, or tax evasion.
References:
* ACAMS Study Guide 6th Edition, Chapter 2, page 36
* Red Flags And Atypical Customer Behavior: Anti-Money Laundering Awareness
* 4 Red Flags of Money Laundering or Terrorist Financing
NEW QUESTION # 386
A close relative of a privately-owned bank's senior manager requests to open an account. Because of this relationship, the staff expedites the opening of the account without following established account-opening procedures. Applying the Basel Committee on Banking Supervision principles, which of the following poses the highest operational risk?
- A. Not having appropriate information to share with Financial Intelligence Units.
- B. Failure to conduct proper due diligence.
- C. The possibility of lawsuits that adversely affect the operations of a bank.
- D. The bank's exposure to politically exposed persons.
Answer: B
Explanation:
According to the Basel Committee on Banking Supervision principles, one of the core principles for effective banking supervision is that the supervisor determines that banks have adequate policies and processes for identifying, assessing and managing the risk and impact of exposures to and transactions with related parties, and that these policies and processes are effectively implemented1. Failure to conduct proper due diligence on a close relative of a senior manager who requests to open an account poses the highest operational risk, as it could result in conflicts of interest, reputational damage, legal liability, or financial losses for the bank. The other options are not necessarily the highest operational risk, as they depend on the nature and extent of the relationship, the type and size of the account, and the regulatory and legal framework of the jurisdiction.
References: 1 Core principles for effective banking supervision, Principle 20.
NEW QUESTION # 387
A quarterly review is conducted on a retail customer's account at a bank located in a jurisdiction with currency reporting thresholds. A number of large deposits of financial instruments drawn on other institutions in amounts under thresholds were noted. This activity did not fit the account's historical profile. A suspicious transaction report will most likely be filed if what also occurred?
- A. The customer has defaulted on a large loan with the bank
- B. The customer purchased financial instruments exceeding the threshold on three occasions
- C. The deposited financial instruments were sequentially numbered
- D. Four deposits were made during this period that exceeded the thresholds
Answer: C
NEW QUESTION # 388
The branch manager notices that a number of customers come in weekly and always use the same teller to process their deposits. The manager notices that the customers and the teller, who are from the same ethnic group, are speaking in a foreign language and every once in a while the customers from local ethnic restaurants will bring the teller lunch. The commercial customers that visit the teller generally deposit the same amount of cash each time they come in.
How should the branch manager respond to this activity?
- A. Encourage the teller to bring in more business from the ethnic community
- B. Conduct further investigation before taking any other action
- C. Suggest to the teller to send the customers to other tellers to avoid the opportunity for collusion
- D. Transfer the teller to another branch
Answer: B
Explanation:
The branch manager should conduct further investigation before taking any other action, as this activity may indicate possible money laundering or fraud. The branch manager should review the transaction records of the customers and the teller, and look for any unusual or suspicious patterns, such as large or frequent cash deposits, round amounts, structured transactions, or inconsistent information. The branch manager should also interview the teller and the customers, and ask them about the nature and purpose of their relationship, the source and use of funds, and the reason for choosing the same teller. The branch manager should document the findings and report any suspicious activity to the appropriate authorities, if necessary.
References:
CAMS Study Guide, 6th Edition, Chapter 3, Section 3.21
CAMS Study Guide, 6th Edition, Chapter 4, Section 4.21
CAMS Exam Questions and Free Practice Test, Question 322
NEW QUESTION # 389
What is the primary purpose of anti-bribery and corruption regulations?
- A. To protect against election interference by corrupt foreign adversaries facilitated by illicit funds
- B. To prohibit the payment of anything of value by persons or entities to government officials or employees of state-owned enterprises to obtain an improper business advantage
- C. To protect against the use of illegal means by senior political figures to avoid paying taxes
- D. To prohibit the conversion of illegally obtained money into legal money by senior government figures
Answer: B
Explanation:
* A: The main objective of anti-bribery and corruption regulations is to prohibit bribes to government officials or employees of state-owned enterprises for the purpose of obtaining or retaining business or securing improper advantages.
* "Anti-bribery and corruption regulations, such as the FCPA and UK Bribery Act, prohibit offering anything of value to public officials to gain a business advantage."(CAMS 6th Edition, Anti-Bribery and Corruption) References:
CAMS 6th Edition, Anti-Bribery and Corruption Standards
FCPA, UK Bribery Act
NEW QUESTION # 390
Which primary international authoritative body designates sanctions?
- A. International Monetary Fund (IMF)
- B. United Nations (UN)
- C. Financial Action Task Force (FATF)
- D. Organization of Economic Co-operation and Development (OECD)
Answer: B
NEW QUESTION # 391
Which of the following are money laundering red flags when reviewing business operations of a money services business (MSB)? (Select Two.)
- A. A customer exchanging foreign currency from a higher-risk jurisdiction for domestic currency under the reporting threshold.
- B. A customer being hesitant to provide beneficiary name or address information when sending international wire transfers.
- C. A customer using multiple accounts under different names to conduct transactions.
- D. A customer completing frequent small-dollar international money transfers to their native country.
- E. Cash-intensive businesses, such as convenience stores or restaurants, making large cash deposits.
Answer: B,C
Explanation:
MSBs are vulnerable to financial crime due to their cash-intensive nature and remittance services.
Option D (Correct): Hesitation to provide beneficiary details suggests anonymity concerns, a common money laundering tactic.
Option E (Correct): Using multiple accounts under different names is a known structuring technique to evade detection.
Option A (Incorrect): Exchanging foreign currency is normal, though higher-risk transactions require monitoring.
Option B (Incorrect): Cash deposits are expected in MSBs but need additional risk factors to be considered suspicious.
Option C (Incorrect): Frequent small transfers may be normal for remittance businesses.
NEW QUESTION # 392
A Financial Intelligence Unit (FIU) in a country has received a Suspicious Activity Report (SAR) involving significant suspicious fund transfers, both domestically and internationally. The FIU requires additional information from a foreign country to determine whether the matter needs to be referred for prosecution locally.
Which of the following statements is true in this scenario?
- A. It is against international laws on data protection to access information from foreign countries.
- B. Countries that are members of the Egmont Group can request assistance for information from each other.
- C. Any information related to money laundering can be received from any organization at any time, regardless of jurisdiction.
- D. Sovereignty of nations means that information cannot be accessed from foreign countries.
Answer: B
Explanation:
Cross-border AML investigations require cooperation through official channels, such as the Egmont Group.
Option D (Correct): The Egmont Group is an international network of FIUs that facilitates secure information exchange in financial crime investigations.
Option A (Incorrect): While sovereignty applies, formal international cooperation mechanisms exist.
Option B (Incorrect): AML cooperation is allowed under legal frameworks (e.g., MLATs, Egmont Secure Web).
Option C (Incorrect): Information-sharing is restricted to authorized government agencies, not all organizations.
NEW QUESTION # 393
What kind of person should perform the independent testing of an institution's anti-money laundering program?
- A. A certified specialist in the anti-money laundering field
- B. A retired government regulator or federal law enforcement officer
- C. A former anti-money laundering officer from a similar institution
- D. A person who reports directly to the Board of Directors or a Board Committee
Answer: D
Explanation:
According to the Anti-Money Laundering Specialist (the 6th edition) by ACAMS, the independent testing of an institution's anti-money laundering program should be conducted by a person who reports directly to the Board of Directors or a Board Committee. This ensures that the person conducting the testing has the necessary authority, independence, and objectivity to evaluate the program's adequacy and effectiveness, and to report any findings or recommendations to the senior management1. The person conducting the testing should also have the appropriate knowledge, skills, and experience in the anti-money laundering field, and should be familiar with the institution's products, services, customers, and risks2.
The other options are not necessarily suitable or qualified to perform the independent testing of an institution' s anti-money laundering program. For example:
* A certified specialist in the anti-money laundering field may have the relevant expertise and credentials, but may not have the required independence or reporting line to conduct the testing. For instance, if the certified specialist is an employee of the institution who is involved in the implementation or operation of the anti-money laundering program, then there may be a conflict of interest or a lack of objectivity in the testing process1.
* A former anti-money laundering officer from a similar institution may have the relevant experience and background, but may not have the current knowledge or familiarity with the institution's anti-money laundering program, policies, procedures, or systems. Moreover, the formeranti-money laundering officer may have a personal or professional relationship with the institution or its staff, which may compromise the independence or integrity of the testing process1.
* A retired government regulator or federal law enforcement officer may have the relevant authority and credibility, but may not have the specific skills or qualifications to conduct the testing. For instance, the retired regulator or law enforcement officer may not be well-versed in the latest anti-money laundering standards, regulations, or best practices, or may not be able to apply them to the institution's unique risk profile, products, services, or customers1.
:
Anti-Money Laundering Specialist (the 6th edition) by ACAMS
What Is An AML Compliance Program? | ComplyAdvantage
NEW QUESTION # 394
The board of directors receives notice from the primary regulator of the bank that potentially suspicious activity has been identified and the bank president appears to be involved. The Board asks the compliance officer for advice.
Which action should the compliance officer take when informed?
- A. Inform the president of the regulator's suspicions and ask for his advice
- B. Destroy all records relating to the matter
- C. Inform the bank's legal counsel and follow their instructions
- D. Insist on the president's immediate resignation
Answer: C
Explanation:
The compliance officer should inform the bank's legal counsel and follow their instructions when informed of the regulator's notice. This is the most prudent and professionalcourse of action, as it ensures that the compliance officer acts in accordance with the bank's policies and procedures, as well as the applicable laws and regulations. The compliance officer should also document the communication and cooperation with the legal counsel and the regulator, and preserve all relevant records and evidence relating to the matter. The compliance officer should not take any action that could compromise the integrity or confidentiality of the investigation, such as destroying records, insisting on the president's resignation, or informing the president of the suspicions.
ACAMS CAMS Certification Study Guide, 6th Edition, page 47
ACAMS CAMS Certification Exam Outline, 6th Edition, Domain 2, Task 2.4
ACAMS CAMS Certification Video Training Course, Module 2, Lesson 2.4
Exam CAMS: Certified Anti-Money Laundering Specialist (the 6th edition), Question 337
NEW QUESTION # 395
According to recommendations from the Financial Action Task Force, what role does a country's financial intelligence unit play in safeguarding against money laundering?
- A. Generates currency transaction reports to send to the central bank
- B. Assists the pursuit of criminal activity by producing suspicious activity reports
- C. Analyzes data on suspicious activity reports
- D. Monitors monthly public statistics on the economy
Answer: B
Explanation:
According to the Financial Action Task Force (FATF), a country's financial intelligence unit (FIU) plays a key role in safeguarding against money laundering and terrorist financing. One of the main functions of an FIU is to receive, analyze, and disseminate suspicious activity reports (SARs) submitted by financial institutions and other obligated entities. By analyzing SARs, an FIU can identify trends, patterns, and other intelligence related to money laundering and terrorist financing, which can assist in the pursuit of criminal activity. While an FIU may also generate currency transaction reports (CTRs) or other types of financial reports, these functions are not specific to safeguarding against money laundering and terrorist financing.
Similarly, while monitoring monthly public statistics on the economy may be an important aspect of macroeconomic analysis, it is not a specific role of an FIU in safeguarding against money laundering and terrorist financing.
NEW QUESTION # 396
Which three methods are commonly used by an accountant to launder money? (Choose three.)
- A. Acting as a conduit for transferring cash between accounts
- B. Acting as a designee for someone who wishes to hide their identity
- C. Representing a client in court
- D. Overstating income to hide excess cash
- E. Understating income to take a tax loss
Answer: A,B,D
NEW QUESTION # 397
Combating the Financing of Terrorism (CFT)]
Which piece of information identified by customer screening would be the most likely reason to trigger consideration of exiting a business relationship with a customer because of financial crime concerns?
- A. The customer is a shareholder of a corporation declared bankrupt.
- B. The customer allegedly violated a construction permit limit.
- C. The customer is a politically exposed person (PEP).
- D. The customer is linked to an organized crime group.
Answer: D
Explanation:
Financial institutions must screen customers against adverse information and determine whether they pose a significant financial crime risk.
* Option B (Correct):A direct link to an organized crime group is a severe red flag. Organized crime networks engage in money laundering, corruption, and other illicit activities. UnderFATF Recommendations 10 and 12, financial institutions must implement enhanced due diligence (EDD) for high-risk customers and consider account closure if they pose undue risk.
* Option A (Incorrect):Bankruptcy does not necessarily indicate financial crime risk, though it may raise financial stability concerns.
* Option C (Incorrect):While PEPs pose a higher risk for corruption, financial institutions typically apply EDD rather than immediately terminating the relationship.
* Option D (Incorrect):Violating a construction permit is a regulatory issue, not directly linked to financial crime.
Reference:FATF Recommendation 10 (Customer Due Diligence); FATF Recommendation 12 (PEPs); Wolfsberg Principles on Risk-Based Due Diligence.
NEW QUESTION # 398
Combating the Financing of Terrorism (CFT)]
A customer comes into a financial institution and deposits a large amount of cash. He has never done that before. When asked about the deposit, he indicates he recently sold a used car and received cash.
He does not trust forms of payment and is wary of counterfeit money orders. What should the bank do?
- A. While the explanation may be plausible, the institute should nonetheless file a Suspicious Transaction Report to protect itself
- B. While the explanation appears plausible, the institution should, for a period of time, monitor the account for cash transactions and suspicious activity
- C. The institution should close the account before another issues arise
- D. The bank has received a plausible explanation, so it should do nothing
Answer: B
Explanation:
A large cash deposit is a potential indicator of money laundering, especially if it is inconsistent with the customer's profile or behavior. Therefore, the bank should ask the customer about the source and purpose of the funds, and verify the information if possible. In this case, the customer claims to have sold a used car and received cash, which may be a reasonable explanation. However, the bank should not rely solely on the customer's statement, but should also monitor the account for any further cash transactions or suspicious activity that may indicate money laundering. For example, the bank should check if the customer withdraws the cash soon after the deposit, transfers the funds to other accounts or jurisdictions, or engages in structuring or smurfing to avoid reporting thresholds.
The bank should not do nothing, as this may expose the bank to regulatory or reputational risks, or facilitate money laundering. The bank should also not file a Suspicious Transaction Report (STR) unless there are other grounds to suspect money laundering, as this may be premature or unnecessary. The bank should not close the account before another issues arise, as this may be disproportionate or discriminatory, and may also alert the customer to the bank's suspicion.
:
[ACAMS Study Guide for the CAMS Certification Examination, 6th Edition], Chapter 4: Conducting or Supporting the Investigation Process, pp. 103-104, 107-108.
Customer Identification Program - Overview, Federal Financial Institutions Examination Council, April 2018, pp. 1-2, 4-5.
Suspicious Activity Reporting - Overview, Federal Financial Institutions Examination Council, April 2018, pp. 1-2, 4-5.
18 AML Analyst Interview Questions (With Example Answers), ResumeCat, accessed on February 9, 2024.
NEW QUESTION # 399
Under requirements for correspondent accounts in the USA PATRIOT Act, the word "certification" refers to a written representation by a
- A. respondent bank, certifying that they do not do business with politically exposed persons.
- B. correspondent bank, certifying that they do not open correspondent accounts for alternative remittance companies.
- C. federal receiver" certifying that he is not the beneficial owner of the correspondent account.
- D. respondent bank, certifying that they do not do business with shell banks.
Answer: D
Explanation:
it describes the word "certification" as a written representation by a respondent bank, certifying that they do not do business with shell banks. This is one of the requirements for correspondent accounts in the USA PATRIOT Act, which is a law enacted in 2001 to enhance the anti-money laundering and counter-terrorist financing (AML/CTF) measures in the United States. The USA PATRIOT Act requires that correspondent banks, which are banks that provide services to other banks, such as clearing, settlement, or cash management, to obtain a certification from their respondent banks, which are banks that receive services from correspondent banks, to ensure that they are not involved in money laundering or terrorist financing activities.
One of the elements of the certification is that the respondent bank does not do business with shell banks, which are banks that have no physical presence or meaningful supervision in any jurisdiction, and are often used by money launderers and other criminals to hide their identity and funds.
The other options are not necessarily the word "certification" as a written representation by a respondent bank under the USA PATRIOT Act, although they may have some relevance or importance depending on the circumstances and the nature of the correspondent relationship. Option A describes a possible certification by a federal receiver, which is a person appointed by a court to take custody and control of the assets of a failed bank, but this is not related to the correspondent accounts requirements in the USA PATRIOT Act. Option B describes a possible certification by a respondent bank, certifying that they do not do business with politically exposed persons (PEPs), which are individuals who hold or have held prominent public positions or their close associates or family members, and who may pose a higher risk of money laundering or corruption, but this is not a mandatory element of the certification under the USA PATRIOT Act, although it may be a good practice or a risk-based measure. Option C describes a possible certification by a correspondent bank, certifying that they do not open correspondent accounts for alternative remittance companies, which are businesses that provide money transfer or payment services outside the formal banking system, and which may pose a higher risk of money laundering or terrorist financing, but this is not a requirement for the respondent bank under the USA PATRIOT Act, although it may be a regulatory obligation or a risk-based measure for the correspondent bank.
References:
* ACAMS CAMS Certification Video Training Course - 6th Edition1
* Exam CAMS: Certified Anti-Money Laundering Specialist (the 6th edition)2
* ACAMS CAMS Study Guide - 6th Edition, Chapter 7, pages 156-157
https://www.acams.org/wp-content/uploads/2019/09/ACAMS-CAMS-Study-Guide-6th-Edition-Chapter-7.pdf
NEW QUESTION # 400
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