Which information should be gathered as part of enhanced due diligence (EDD) for a high-risk customer?
Which of the following poses the greatest money laundering risk for a financial institution offering on-line services to customers?
A financial institution in a jurisdiction with currency reporting thresholds is undergoing a branch office compliance review. A large number of currency transactions in amounts exceeding a reporting threshold were discovered without a currency transaction report (CTR) being filed. The transactions were handled by the same teller (cashier). This teller (cashier) was recently hired and had not received anti-money laundering training yet. The branch manager received daily exception reports of all large currency transactions as well as a report of all CTR filings. Which of the following should the compliance officer recommend as the initial action?
Which are essential elements of a KYC program identified by the Base1 Committee on Banking Supervision? (Select Two.)
According to the Financial Action Task Force, financial institutions should be required to implement:
An individual opens an e-account in an off-shore gambling website using non-documentary verification and creates an e-wallet on a mobile device. In order to add funds to the account, the individual uses a credit card, wire transfers, cryptocurrency, and a money service business. Which source of money represents more risk of money laundering?
Which is the first valid step in the Mutual Legal Assistance Treaties international cooperation process?
Which scenario should be escalated as potentially suspicious activity?
A bank teller receives a written request from a police officer to review a previous customer's account on a pre-populated form with the officer's official letterhead. The officer suspects the previous customer is engaging in smurfing. Which action should the bank teller perform?
Which methods are typically used to launder money using insurance companies? (Choose two.)
According to the Financial Action Task Force, as part of their risk assessment, which are important data and information that a Trust and Company Service Provider must understand when establishing and administering a trust? (Select Two.)
The Wolfsberg Group has issued a number of documents since its inception aiming to:
Which statements relate to the mandate, roles, and responsibilities of the Financial Action Task Force (FATF) and the FATF-Style Regional Bodies (FSRBs)? (Select Two).
Which test should be included in a bank's Office of Foreign Assets Control sanctions screening audit program?
The marketing department presents to an anti-money laundering specialist a business plan targeting individuals holding important public positions. In addition to obtaining the proper identification and basic information from these customers, what else should theanti-money laundering specialist recommend a financial institution do to check the background and conduct enhanced due diligence based on public information?
1. Determine if a client appears on the Basel Committee on Banking Supervision's list of public officials.
2. Investigate the source of funds.
3. Identify people and companies that are clearly related.
4. Identify a person fully, including their political history.
An alert has been triggered by a monitoring system and an investigation has been opened. The activity involves significant and multiple cash deposits into a personal account and transferring funds to an offshore bank on the same day. Further investigation reveals this personal account had experienced low levels of activity for the past 6 months and funds are transferred to the account of a charitable organization. Which of the following is the next step that the Compliance Officer should take?
Cybersecurity risk can result in identity theft by:
Which is a red flag for funds transfers?
A long-term client of an insurance company makes changes to a policy that require payment of an additional lump sum. The amount payable is high, though within the client's means based on the KYC information collected. The payment is made via a company in another jurisdiction that is known to have lax AML controls. Which indicator of suspicious activity is present?
Which are characteristics of Mutual Legal Assistance Treaties (MLATs)? (Select Three.)
A bank’s transaction surveillance system triggers an alert for a deposit of 250.000 USO into a client's account. According to the bank's KYC information, the client works for a financial advisory firm, and earns approximately 100,000 USD per year. Which actions should be taken? (Select Three.)
File the suspicious transaction immediately to the financial intelligence unit.
When may Office of Foreign Assets Control (OFAC) sanctioned-related transactions be allowed that would otherwise be prohibited?
After a FATF mutual evaluation process, which are resulting actions for jurisdictions that are determined to have strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing? (Choose two.)
Which of the following is the main reason Internet gambling is an ideal web-based money laundering method?
Which factors specific to the securities industry increase the exposure to money laundering risk? (Select Two.)
Which constitute red flags in connection with a company involved in illegal logging? (Select Three.)
A new customer has just been onboarded in a securities firm. After a few weeks, there are unusual trading patterns that are being flagged. Which pattern is most concerning to the compliance officer?
An accounting firm opened an account at a bank that is intended to be used as the operational account for the business. After a few months, a comprehensive review of the account was triggered due to unusual activity on the account. Which most likely triggered the review?
Which should authorities do to safeguard AML information exchanged with other countries?
The Chief Compliance Officer (CCO) of a financial institution has been asked by a manufacturing customer reliant upon imported raw materials if there will be repercussions to his business following the weak assessment of the recent publicly issued Financial Action Task Force (FATF) Mutual Evaluation Report (MER). How should the CCO respond?
Which of the following is the most likely reason for the Financial Action Task Force to remove a jurisdiction from the Non-Cooperative Countries and Territories list?
Which assessments are involved in the processes of mutual evaluation and follow-up by the FATF?
Which is a FATF characteristic used to assess a country's effectiveness of its AML regime?
Financial institutions (FIs) perform AML risk assessments to ensure:
One of the red flags of microstructuring is:
According to the Basel Committee on Banking Supervision, banks should deal with high-risk customers by:
Which does the USA PATRIOT Act stipulate for foreign banks concerning correspondent banking?
A US casino customer has won 55,518 USD. The customer goes to the casino cashier cage to execute some transactions. Which ^transactions are an indicator of money laundering? (Select Two.)
A non-U.S. bank asks its U.S. correspondent whether there is risk of having funds seized in their correspondent account if a customer is involved in a predicate offense.The correspondent bank's reply should be,
The findings of an internal audit discover that a large group of employees do not know how to handle Politically Exposed Persons (PEPs). Which is the next course of action that should be taken?
According to the Basel Committee's principles on customer due diligence, a bank should:
An oil exploration company based in France does business with oil refineries in Iran, which is subject to comprehensive Office of Foreign Assets Control (OFAC) sanctions. What type of OFAC sanctions should be imposed against the French company?
What is an example of a legal risk a financial institution (FI) could face if it is sanctioned for failure to report suspected fraud activity?
Which elements can trigger a review of the existing relationship during the opening of a new account? (Select Two.)
During the course of work on behalf of a client, a lawyer participated in the movement of money. If the lawyer suspects an act of money laundering, which of the following should the lawyer do according to European Union Money Laundering Directives?
The Egmont Group is a world wide organization of
A retail bank prepares a yearly AML risk assessment. Which inherent risk factor is likely the most relevant?
An anti-money laundering specialist at a large institution is responsible for informing senior management about the status of the anti-money laundering program across the organization. The global institution handles retail banking, commercial banking, global markets, private banking and has an affiliated securities dealer. The specialist and the team provide corporate strategic direction to these areas on anti-money laundering related subjects. The following information is reported to executive management on a regular basis:
•Total number of suspicious transactions identified and reported
•Suspicious transaction trends
•Training that has occurred for the various units
•Status report on the anti-money laundering regulatory environment
•Summary of exception reports
Which of the following additional elements is the most useful?
Which transaction monitoring processes would alert a bank for red flag activity?
A financial institution recently purchased anti-money laundering software. The software routinely generates more alerts than the anti-money laundering staff can properly analyze as a result of limited staffing. These alerts are generated by default software rules. Which of the following should the individual responsible for setting the anti-money laundering software parameters recommend?
Which is a valid extraterritorial effect of the USA PATRIOT Act?
When using virtual assets such as Bitcoin to finance terrorism, which tactic may be used to ensure that the virtual assets are not easily seized by law enforcement?
An anti-money laundering specialist is employed by a large multi-national bank. The bank is planning to open an international department that will be responsible for expanding services to various countries. The head of the new international department has asked the specialist to assess risks associated with the bank's expansion plans. Which of the following materials should be included as a reference?
1. USA PATRIOT Act
2. Financial Action Task Force 40 Recommendations
3. Customer Due Diligence for Banks issued by the Basel Committee on Banking Supervision
4. The Egmont Group Statement of Purpose
The most effective tool used to detect structured transactions is
Which is a key aspect in the FATF Recommendations that best describes the essential foundation for allocating resources in AML/CFT regimes for countries and financial institutions (FIs)?
A key element required to ensure an anti-money laundering compliance program is effectively embedded into an institution's culture is
A financial institution is reorganizing and the anti-money laundering officer is now required to report to the Sales Director. Which of the following statements about this situation is most correct?
Which red flag should a compliance officer prioritize first for investigation?
Financial Intelligence Units (FIUs) are responsible for:
Which three do the Office of Foreign Asset Control regulations cover? Choose 3 answers
A bank sells reloadable open-loop prepaid cards to both customers and non-customers.
What is a red flag associated with these cards that may indicate money laundering?
A local law enforcement officer, who is conducting a criminal investigation, requests information about a customer.
Which two actions should the bank take? (Choose two.)
In performing a risk analysis, which factor(s) should a financial institution review?
How should a compliance officer respond to law enforcement agencies' request for information on a customer undergoing an investigation?
The Wolfsberg Principles for Private Banking list circumstances that would require additional due diligence, including activities that involve which three of these choices?
According to experts, what is the most effective way to prevent money laundering through financial institutions?
At a small community bank, the compliance officer identifies unusual activity on a customer, who with his personal and company accounts, is the bank’s largest depositor. The customer’s companies have significant balances on their outstanding loans. The compliance officer notices that there is a lot of unusual movements of money between the customer’s individual and business accounts. After filing a suspicious transaction report (STR), the compliance officer gets a call from law enforcement indicating that they want the bank to keep the account open while they conduct an investigation into the customer.
How should the compliance officer escalate this information to the board of directors?
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 foreign bank maintains a correspondent account in the US. According to an investigation carried out by US authorities, the specific correspondent account seems to have facilitated a transaction involving tainted funds. Which allows the US authorities to seize the funds of the foreign bank held with the US bank?
Which situation is the highest risk for money laundering and terrorist financing activity?
In the FATF 40 recommendations, the focus of AML efforts has been expanded beyond Financial Institutions. Which three businesses and/or professions are covered? Choose 3 answers
What does the Financial Action Task Force (FATF) urge its members and all other jurisdictions to do when a jurisdiction is identified as having lax anti-money laundering / counter financing of terrorism controls?
OFAC-issued regulations apply to which entities? (Choose two.)
A remittance company received a money order from a senior political figure m the Philippines to transfer a large sum of money to a charity group in the Philippines. A review of the charity group revealed a director having dose ties with a known terrorist group primarily financed through kidnapping and extortion.
What is a key risk indicator associated with terrorism financing?
One key aspect of promoting an enterprise-wide compliance culture within a financial institution (FI) is that the:
What are three factors a financial institution should examine with regard to a new customer who is opening up a new account? Choose 3 answers
What core objective does the Egmont Group suggest would lead to an effective national Financial Intelligence Unit (FIU)?
What can a compliance officer do in the absence of automated software to conduct U.S. Department of the Treasury Office of Foreign Assets Control (OFAC) sanction screens?
A law enforcement agency is reviewing a suspicious transaction report (STR) filed by a financial institution for suspicious activity on a client's account.
Subsequently, the agency requests further information.
Which supporting documentation might the law enforcement agency request from the institution to facilitate its investigation?
What is an aspect of the USA PATRIOT Act that has extraterritorial reach?
After review of the financial institution's enterprise-wide anti-money laundering risk assessment, the new compliance officer identifies several deficiencies that need attention.
Which deficiency could lead to the highest potential for unmitigated risk?
A local law enforcement officer notifies the bank compliance officer that he is working on an insurance fraud scheme that appears to be running transactions using the account of a bank employee. The law enforcement officer refers to a kiting suspicious transaction report filed by the compliance officer and requests further information.
What action should the compliance officer take?
Which measure to mitigate risk does the Basel Committee’s Customer Due Diligence Principles suggest banks apply when accepting business from non-face-to-face customers?
What are three indicators of money laundering associated with using electronic funds transfers? Choose 3 answers
Which method to finance terrorism involves falsifying transaction-related documents?
The ultimate goal of economic sanctions is to:
Which information must a United States financial institution retain for having foreign correspondent accounts as part of the USA PATRIOT Act record keeping requirements?
The new compliance officer has reviewed the bank’s anti-money laundering training program. The program consists of online training for all new employees within 30 days of hire date and annual refresher training to all employees. In addition, there is specialized training for areas that deal with higher risk products and customers.
Over the last year, there have been no regulatory changes and no new products or services have been introduced. The compliance officer wants to propose to the board of directors that the annual refresher training is still current and can be delivered unchanged to all employees.
Which two critical pieces of information could be missed by taking this approach? (Choose two.)
In which two ways do Financial Action Task Force-style regional bodies influence anti-money laundering and terrorist financing standards within their respective regions? (Choose two.)
Which action should an FIU consider taking when it has information that might be useful to another FIU?
Which product is considered to be of highest money laundering risk?
An anti-money laundering analyst is reviewing a new customer list to confirm potentially high risk customers have been identified and subject to enhanced due diligence.
Which new customer warrants enhanced due diligence?
A bank maintains a number of United States (U.S.) dollar correspondent accounts for foreign financial institutions. Upon a routine review of a U.S. dollar correspondent account owned by Foreign Bank A, a number of transactions appear to have been originated by Foreign Bank B outside the expected activity for this account. These transactions appear suspicious and a suspicious transaction report was filed by the compliance officer.
Which step should the compliance officer take?
What is the term for trading through multiple accounts, where an individual generates offsetting profits and losses and transfers of positions through accounts that do not appear to be commonly controlled?
A prospective AML officer comes highly recommended by a banks up-stream correspondent institution of similar size and make-up, located in a different city in the same country. The bank is interested in hiring the individual. What should be the next step taken by the Board of Directors?
A company service provider in Country A sets up a corporate structure for a client from Country B, which is known for corruption. The corporate structure includes a holding company in Country A with a bank account in one of the international banks located there.
During on-boarding, the client's wealth was estimated at $7 million. Shortly thereafter, the client's father became president of Country B. During a routine client review two years later, it was identified that client's wealth had grown to $510 million.
What are two red flags that indicate money laundering or financial terrorism? (Choose two.)
According to the Second European Union Money Laundering Directive, what may knowledge of criminal conduct be inferred from?
Under the USA PATRIOT Act, in which scenario would the US not have jurisdiction?
An institution receives a request for credit from a local company that has been a client for many years. The information provided by the company indicates that its assets have increased substantially with the addition of several new subsidiaries. Further research performed by the institution indicates the new subsidiaries are recently created shell companies.
Could this indicate potential money laundering?
Which primary international authoritative body designates sanctions?
Which factor should a financial institution (FI) consider prior to sharing customer records within the same jurisdiction?
Which principles should be included in a FATF-Style Regional Body (FSRB) update? (Choose two.)
Which element is generally required of all anti-money laundering programs?
Which is a key reason why a financial institution (FI) conducts an enterprise-wide AML risk assessment?
Which statement is true about when an institute becomes aware that a particular employee is under investigation by law enforcement as a result of a subpoena or warrant?
A compliance officer at a large financial institution has been tasked by senior management to lead a team in an internal review and potential revision of the institution’s customer onboarding program following a regulatory enforcement action of another institution.
Which step should the compliance officer perform first?
Which two steps should a financial institution take when it receives a law enforcement request to keep an account open that may be associated with suspicious or criminal activity? (Choose two.)
FATF recommends the incorporation of some measures in customer due diligence (CDD) programs including:
An organization uses an automated surveillance system that generates a very large volume of anti-money laundering alerts. The monthly volume of alerts has increased over the last year causing the compliance staff to fall significantly behind reviewing the alerts. As a result, the system settings are under review to determine if they are appropriate.
Which action should be included in the evaluation of system settings?
A new AML Officer for a US-based money service business (MSB) is drafting procedures around types of activity that require further review. Which should be included? (Choose two.)
What are four key elements that a KYC program should contain according to the Basel Committee requirements?
To ensure that an institution’s anti-money laundering program is current, which step should be taken?
Since its last regulatory examination, a financial institution has aggressively grown by adding profitable new products and services. The institution has not historically received regulatory criticism regarding its anti-money laundering compliance program. However, a recent regulatory examination cited significant deficiencies in the anti-money laundering program that were attributed primarily to the lack of oversight by the institution’s leadership in implementing adequate controls over the new products and services.
Which area of international control should leadership first address to correct the weaknesses in the program?
A bank receives a wire transfer that references the sale of equipment to a sanctioned company. The bank's operations team removes the sanctioned company reference and allows the wire transfer to process. This is a description of what type of activity?
What was the topic the Wolfsberg Group’s first guidance addressed?
The bank for International Settlements provides the secretariat for which organization?
TheWolfsberg Group’s AML Principles on Private Banking:
What should a bank do if it suspects one of its employees may be involved in mortgage loan fraud?
Whichchanges at a financial institution (FI)should trigger anenterprise-wide reassessmentof itsinherent AML risk exposure? (Select Three.)
Which scenario best justifies why a customer's account might be closed by a financial institution?
What is therelationship between the EU Anti-Money Laundering Directives (AMLDs) and local AML regulationsin European Union (EU) member states? (Select Two.)
Which statements describe risks that are associated with international business corporations? (Select Two.)
Whichpractices should financial institutions (FIs) adoptwhen determining thetimeline for completing an internal AML investigationandfiling a Suspicious Activity Report (SAR) to the Financial Intelligence Unit (FIU)?
Which action does the Financial Action Task Force call on member countries to take in the most serious cases when countries have significant strategic AML deficiencies?
Anewly appointed senior money laundering reporting officer (MLRO)at adigital bankhas been instructed toimplement an effective AML transaction monitoring system.
What areimportant considerationsfor selecting and implementing the AML system? (Select Two.)
Which of the following statements istrueregarding the2012 Financial Action Task Force (FATF) 40 Recommendationsand/or11 Immediate Outcomes?
Which of thebelow statementsare supported by theFinancial Action Task Force (FATF) 40 Recommendationsadopted in 2012? (Select Two.)
Whichmeasures help limit the collection and use of personal datawhen performing AML-related controls?
Which of the followingare key AML measuresthat aregulated asset management companyin theEuropean Union (EU)should implement? (Select Two.)
According toFinCEN, whichred flagswithin abank accountmay,taken together, be indications ofmodern slavery, human trafficking, and exploitation? (Select Two.)
When applying new technologies to AML, application programming interfaces (APIs) allow for:
A customer has borrowed the cash surrender value of their life insurance policies. Which requires a further investigation and filing of the suspicious activity report?
A precious metals dealer opens a new account with a bank. Which requires a referral to AML investigations for further review?
Which scenariobest justifies why a financial institution (FI) might close a customer’s account?
Whichpersons must always comply with all Office of Foreign Assets Control (OFAC) regulations? (Select Three.)
Which economic and social factors could create a dependency on illicit activities and money laundering? (Select Two.)
Which of the following are best practices to raise awareness and train staff regarding the risks related to financial crime? (Select Three.)
TheFinancial Action Task Force (FATF)routinely publishes a catalog of jurisdictions requiringenhanced monitoring, which is commonly called the:
AnAML compliance officerreceives anindependent audit reportwith a number offindings.
Anappropriate responseto thereportwould include:
Arecruitment manager in the human resources departmentof a bank hasshortlisted a candidate for the position of relationship manager in its private banking division.
Thebank’s compliance policyrequiresproper background checksto protect againstfraud and money laundering risks.
Whichresourceswould bemost usefulfor identifying potential negative information regarding the shortlisted candidate? (Select Three.)
In order to demonstrate commitment to AML compliance within a bank, the Board of Directors should:
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?
Based on the AML principles outlined by the Wolfsberg Group, what do private and correspondent banks have in common when monitoring for terrorist financing?
Which of the following is an important factor to consider when setting up an anti-financial crimes (AFC) compliance program governance structure?
Thegoal of the Egmont Group of Financial Intelligence Units (FIUs)is to provide aforum for FIUsto: (Select Three.)
When under aregulator’s consent orderor similar action, who at an organization isultimately accountablefor the remediation ofany violations of AML/CFT laws and regulations?
Money laundering red flags associated with money service businesses include: (Select Two.)
AFinancial Intelligence Unit (FIU)in a country has received aSuspicious Activity Report (SAR)involving significant suspicious fund transfers,both domestically and internationally. TheFIU requires additional information from a foreign countryto determine whether the matter needs to be referred for prosecution locally.
Which of the following statements istruein this scenario?
Whichsection of the USA PATRIOT Actrelates toforfeiture of funds and allows for extraterritorial reach?
Which activities could be considered a potential spear phishing scam? (Select Three.)
Whichkey metricwould provide themost valuable datatosenior managementabout theeffectiveness of its AML controls?
Which regulation permits financial institutions, upon providing notice to the US Department of the Treasury, to share information with one another in order to identify and report activities that may involve money laundering or terrorist activity to the federal government?
The Office of Foreign Assets Control (OFAC) is responsible for:
Which actions should be taken bya financial institution (FI) when it receives a grand jury subpoena regarding a customer?
What is thepurpose of a Risk Appetite Statement (RAS)and its linkages while implementingorganizational controls? (Select Two.)
Whichline of defenseissolely tasked with providing assurance to the Board of Directorsof an organization?
A UK national has accounts with a bank in Belgium, who maintains a branch in New York. The UK national has been recently added and screened against the Office of Foreign Assets Control (OFAC) Specially Designated Nationals and Blocked Persons List. Which action should the Belgian bank take?
Which is often an indirect consequence of non-compliance with AML laws?
Which of the following risk factors are considered by many supervisory authorities as representing a higher inherent risk associated with MSBs? (Select Two.)
What is a key objective of the Egmont Group?
A country that does not have strong predicate offenses and is lax in prosecuting AML cases could suffer which social/economic consequence?
Which should be provided to the board of directors or designated specialized committee when preparing suspicious activity reports (SARs)?
Section 319(a) of the USA PATRIOT Act:
Which is the most severe consequence for a financial institution if the regulator finds it is in breach of AML regulatory obligations?
According to Basel Committee guidelines, which level of the organization should determine whether or not to enter business relationships with higher risk customers?
Whichred flagscould indicateincreased terror financing and money laundering risksrelated tocultural objects? (Select Three.)
Law enforcement is confidentially investigating 20 individuals suspected of belonging to a criminal network allegedly involved in laundering tens of millions of euros for cybercriminals. Which actions need to be taken by the AML Specialist at a bank upon learning the alert? (Select Two.)
AnAML analyst at a bankis investigating cases triggered bytransaction monitoring alerts.
Whichcircumstances might cause the analyst to suspect a case involves terrorist financing? (Select Two.)
A customer's registered business activity is a domestic carpet cleaning company. Besides domestic receipts, there are incoming weekly transactions from an international reputable
auction house starting at 15,000 USD and averaging 30,000 USD. The matching cash outgoings amount to 90% of the incoming deposits to non-related individuals. Which is most
concerning for potential money laundering?
A compliance officer at a financial institution has completed an investigation into a high-risk customer's activities and determined that there are strong indications of money laundering. The compliance officer has documented their findings and is ready to recommend offboarding the customer. However, the relationship manager responsible for the customer is resistant to the idea, citing the customer’s significant revenue contribution to the institution.
What should the compliance officer do next to ensure the appropriate escalation and decision-making process is followed?
Which of the following entities could potentially pose a higher money laundering risk and require additional review prior to onboarding? (Select Two.)
Law enforcement is conducting an investigation of a financial institution (FI) and has submitted an overly broad and unduly intrusive request. Which is a Fl's most appropriate response?
Aninternational bankis investigating apayment requested by a correspondent banking partner. The payment originated from acorporation located in Hong Kong, and the final beneficiary is anindividual in New York. The transaction triggered an alert in the bank’sautomated transaction monitoring system.
Which steps should the bank take first to address the alert? (Select Three.)
A customer of a bank is an established art dealer. Within the KYC due diligence processes, which constitutes a triggering event that requires ongoing due diligence on this client?
A bank maintains a relationship with a customer who owns a small bakery business.
Which customer action indicates potential money laundering?
Trusts established in certain offshore jurisdictions make good vehicles to lay under money for which ofthe following reasons?
A businessman requests a European private bank to open a numbered or alternate name account. According to the Basel Committee on Banking Supervision principles, which of the following is the most important question the banker should ask?
A financial institution receives a regulatory enforcement action because of deficiencies in its anti-money
laundering program.
Which action should the board of directors take?
When must a United States (U.S.) bank block or reject an international funds transfer when there is an Office
of Foreign Assets Control designated party to the transaction?
An employee hears a colleague on the telephone with a customer giving advice on how to ensure that a
suspicious transaction report will not be filed as a result of a future transaction.
What action should the employee take?
What does the Financial Action Task Force 40 Recommendations address on transparency of beneficial ownership?
The branch manager calls the compliance officer and informs her that a law enforcement officer has just left
the branch and was asking a lot of QUESTION NO:s and left a business card.
What should the compliance officer do?
A suspicious transaction report filed on a car dealer structuring deposits initiates a criminal investigation. The dealer changes branches and begins placing transactions with a frontline employee to whom the dealer has given numerous gifts.
This employee handles all of the dealer's structured deposits and does not report the suspicious activity internally.
The competent authority has advised the anti-money laundering specialist to avoid tipping off the employee until the investigation is finalized.
What action should the specialist take next?
Law enforcement submitted a request to a bank for information regarding one of its customers.
How should the bank respond according to Financial Action Task Force Guidance?
Which three circumstances are indicators for defining a customer as required additional diligence according to the Wolfsberg Principles on Private Banking? Choose 3 answers
A law enforcement official calls a bank inquiring about a customer who is currently under investigation. The
law enforcement official requests information about the customer.
How should the bank respond?
Which three stages of money laundering are on-line banking vulnerable to?
A bank employee reviews wire transactions looking for indications of wire stripping.
Which two actions should the employee take to complete appropriate bank procedures? (Choose two.)
What are two requirements for monitoring and reporting suspicious activity for correspondent banking
according to the Wolfsberg Principles? (Choose two.)
A customer living in a high-risk jurisdiction makes frequent, large cash deposits at a bank. The same customer
sends small wire transfers to unrelated parties in other high-risk jurisdictions.
What are two red flags that may indicate money laundering? (Choose two.)
In which situation can money laundering adversely affect a country’s currencies and interest rates due to launderers investing dirty funds?
Which factor should a bank consider before sharing information about a customer with its broker-dealer
affiliate in the case of an investigation?
Which method to launder money through deposit-taking institutions is closely associated with international
trade?
What is an example of the integration stage of money laundering involving a bank or another deposit-taking institution?
When should the anti-money laundering risk assessment be updated?
What are three elements of a sound Customer Due Diligence Program?
A politically exposed person (PEP) maintains an account at a bank. Last month a money laundering analyst filed a suspicious transaction report about unusual wire deposits originated by unknown individuals in the home country of the official.
To whom should this situation be escalated?
In establishing procedures for the review of suspicious transactions and filling of STRs, what thing should an institution focus on?
Which three methods are commonly used by an accountant to launder money? (Choose three.)
What types of things should an institution incorporate in it AML policies and procedures? Choose 3 answers
Financial Action Task Force (FATF)-style regional bodies are created and obliged to understand the inherent
money laundering and terrorist financing risks in the region of the world they serve.
What is one of the methods they use to understand these risks?
According to the Financial Action Task Force 40 Recommendations, Designated Non-Financial Businesses and Professions include
What does designing a country as being of “prime money laundering concern” allow the U.S. government to do?
Upon filing a suspicious transaction report, which of th€ following elements should be the highest anti-money laundering priority in making the decision to keep the account open?
A popular restaurant in town has begun depositing less cash than it has in prior years. In a review of the
customer’s accounts, you notice that credit card receipts have increased with no .
The account officer discovers that the restaurant has installed a privately-owned automated teller machine
(ATM) onsite and has begun construction on a patio dining area.
Which red flag should trigger additional investigation?
Who has the ultimate responsibility within a bank for ensuring that the bank has a comprehensive and
effective Bank Secrecy Act / anti-money laundering (BSA/AML) program and oversight framework that is
reasonably designed to ensure compliance with applicable regulations?
What are two legal risks of having inadequate privacy policies and procedures? (Choose two.)
During an ongoing investigation into a client's activities by a competent authority, a compliance officer should
What are two requirements with respect to supporting documentation that is used to identify potentially
suspicious activity, according to Financial Action Task Force? (Choose two.)
Which of the following provides anti-money laundering specialists information related to money laundering trends?
1. Egmont Group's 100 Cases
2. Financial Action Task Force Typologies
3. FinCEN's SAR Activity Review
4. The Wolfsberg Principles
Which insurance product is particularly vulnerable to money laundering?
Following a recent exercise which explained how a correspondent banking operation could be used by money launderers, an anti-money laundering specialist decided to re-write the due diligence procedures for entering into agreements with foreign financial institutions. Which of the following information should be included to establish a rigorous "Know Your Respondent" procedure?
1.Respondent's management, nature of license, and major business activity.
2. Computer equipment and software capability.
3. The quality of supervision in the home country.
4. Respondent's location, in particular the existence of a real physical presence.
A foreign politically exposed person (PEP) requests to add a beneficiary to a file insurance policy.
How should the request be processed to mitigate risk?
What is the appropriate compliance control for identifying politically exposed persons (PEPs) according to the Basel Committee’s paper on Customer Due Diligence for Banks?
Upon a routine account review a money laundering investigator identified a number of large round dollar wire transfer deposits into a business account owned by a local auto repair shop. The wire transfers all originated from a country that is a known financial secrecy haven with poor anti-money laundering controls. The investigator concludes there appears to be no legitimate business purpose for the wire transfers and files a
suspicious transaction report. The owner of the auto repair shop is popular in the community and is a wellknown philanthropist.
To whom should the investigator escalate these concerns?
The anti-money laundering specialist of a small bank has identified suspicious activity at a branch located in an area of town where drug dealers are known to operate. An investigation of this activity discloses that the suspicious transactions occurred within the last 3 months and were processed by the same teller (cashier). The teller (cashier) did not file an internal report of unusual activity on these transactions. When checking personnel files, the specialist finds that the teller (cashier) has been a trusted employee for over 15 years, has an impeccable work record, and has participated in several anti-money laundering training sessions. The specialist recently became aware that the employee's daughter has contracted a rare disease and is undergoing a very expensive treatment program. Regarding the teller's (cashier's) failure to report the unusual activity to the institution, the specialist should recommend
A money remittance business will most likely attract money launderers because it
1.deals primarily in cash transactions.
2.engages in international transactions.
3. conducts transactions for walk-in customers.
4.does not have to comply with transaction reporting.
What is true regarding disclosure to a law enforcement agency by a financial institution of the supporting
documentation for a suspicious transaction report?
Which two statements in the Wolfsberg Group’s “Suppression of the Financing of Terrorism” define the role financial institutions should play in the fight against terrorism? (Choose two.)
The Basel Committee on Banking Supervision issued a paper in October 2001 in which it presented a Know Your Customer framework and recommended standards applicable to
One key aspect of the Office of Foreign Assets Control’s extraterritorial reach includes the blocking of certain
non-United States initiated transactions for or through the United States (U.S.) for benefit of a restricted person
or entity.
Under which three circumstances are U.S. banks required to block transactions? (Choose three.)
When an institution receives a document request from law enforcement with regard to an STR that the institution has filed, what should institution do?
What should countries do to help prevent non-profit organizations from being abused for the financing of terrorism according to the Financial Action Task Force 40 Recommendations?
How does the Financial Acton Task Force (FATF) communicate its findings regarding jurisdictions with
strategic anti-money laundering / Counter Financing of Terrorism deficiencies?
After evaluating recent changes to international standards, an anti-money laundering specialist should consider enhanced due diligence on accounts held by
1. lawyers.
2. foreign exchange dealers.
3. retail account holders.
4. precious metal dealers.
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?
Which of the following is the financial stage of money laundering?
When a bank performs a risk assessment, what areas should an institution focus on?
According to Basel Committee on Banking Supervision's Customer Due Diligence for Banks, which of the following should provide an evaluation of a bank's policies and procedures independent from its management?
A bank is preparing for its anti-money laundering independent review, which is performed every two years
under the direction of the compliance officer. The bank’s corporate audit department will conduct the review.
The compliance officer will review the final report before it is released to the Board of Directors.
What is the issue with this situation?
Which two factors assist a money laundering investigation that involves multiple countries? (Choose two.)