Whichpractices should financial institutions (FIs) adoptfor the process ofterminating customer relationships? (Select Three.)
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 high volume of incoming wire transfers generates an alert about a client. The funds are immediately debited by cash withdrawals and outgoing wire transfers. Which information should be reviewed first to investigate this alert/case?
It Is important for financial institutions (FIs) to be aware of anti-financial crime (AFC) and sanctions regulatory regimes in other jurisdictions in order to.
According to the Financial Action Task Force (FATF). potential risk indicators related to money laundering proceeds from environmental crimes include. (Select Two.)
Money laundering has social and economic impacts, especially within developing countries. A high volume of money laundering in a country may: (Select Two.)
Which of the followingcorporate structurespresent ahigher money laundering riskdue toreduced transparency? (Select Three.)
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?
Whichchanges at a financial institution (FI) should trigger an enterprise-wide reassessment of its inherent AML risk exposure? (Select Three.)
According to the Basel Committee principles, which actions would make a customer identification program at a bank more robust? (Select Two.)
What are theroles of a government Financial Intelligence Unit (FIU)? (Select Three.)
Abank in the Netherlandshas been requested toshare informationabout aseries of transactions and related customerswith abank in Italy. Both banks are subject toEuropean Union jurisdiction.
Which factor ismost importantto consider before theDutch bank shares the requested informationwith the Italian bank?
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.)
Which activities would be considered money laundering red flags when reviewing the business operations of a money services business (MSB)? (Select Two.)
According to the Financial Action Task Force (FATF) Recommendation 22. when involved in customer transactions that include the buying and selling of real estate, real estate professionals are required to apply which customer due diligence (CDD) measures? (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)?
An employee at a financial institution (Fl) suspects that one of their co-workers is involved in a financial investment scam syndicate. Which step should be taken next by the employee who has the suspicion?
What is theimportance of a risk-based approach (RBA)andbuilding controls commensurate with risks?
Which statement regardingdata privacyis the most accurate in the context ofAML investigations?
Which of thebelow statementsare supported by theFinancial Action Task Force (FATF) 40 Recommendationsadopted in 2012? (Select Two.)
Red flags for potential money laundering in real estate include completing luxury real estate purchases. (Select Two.)
A financial institution (FI) is fined for failure to implement an effective AML program. Which consequences could the regulator impose on the bank's Chief AML Officer? (Select Three.)
The Office of Foreign Assets Control (OFAC) is responsible for:
What is acore function of a Financial Intelligence Unit (FIU)as described inFATF Recommendation 29?
Whichline of defenseissolely tasked with providing assurance to the Board of Directorsof an organization?
A financial institution is conducting an enterprise-wide risk assessment (EWRA) and has identified a high inherent risk of money laundering associated with its private banking division due to the clientele's high net worth and complex financial structures. However, the institution has implemented robust customer due diligence (CDD) and enhanced due diligence (EDD) procedures, along with sophisticated transaction monitoring systems.
How would these controls impact the assessment of residual risk?
Which of the followingindicates potential money laundering activity by a lawyer?
A credit institution has been served with a preliminary findings report highlighting major deviations from AML obligations in its country and stating that it faces the possibility of withdrawal of its banking license.
Which authorities could have issued the report?
Which product type is subject to US extra-jurisdictional reach over non-US banks and non-US persons under the USA PATRIOT Act?
The role of FATF-style regional bodies (FSRBs) is to; (Select Three.)
Which of the following statementsbest describes the role of the Board of Directorsin overseeing an institution’sAML governance and compliance framework, according to theBasel Committee on Banking Supervision?
Which of the following businesses require enhanced or additional scenarios for identifying anomalous transactions? (Select Two.)
Which of the followingscenarios warrants enhanced due diligence (EDD)?(Select Three.)
Whichred flagscould indicateincreased terror financing and money laundering risksrelated tocultural objects? (Select Three.)
What is the first step that an investigator should take when beginning a financial investigation into a potential suspicious activity?
The Wolfsberg Group's 2012 "Principles (or Private Banking" established that.
At a minimum, who should receive role-specific AML training? (Select Three.)
Which section of theUSA PATRIOT Actpermits theU.S. government to seize funds deposited in a U.S. correspondent account of a foreign bank, creating extraterritorial impact?
A student contacts a real estate broker to view a home but cancels last minute due to illness. The student wants to quickly buy the 800,000 USD home, which is overvalued, despite the broker'sobjections to the asking price. Which real estate red flags should the broker identify? (Select Three.)
A financial institution is designing anEnterprise-Wide Risk Assessment (EWRA).
According to theWolfsberg Group’s risk-based approach to AML, an effective EWRA should:
Which of the followingscenarios best justifies why a customer’s account might be closedby a financial institution?
Which activities conducted by a lawyer could be a red flag for money laundering? (Select Two.)
Which accurately describes the social and economic impacts of money laundering?
According to the Financial Action Task Force (FATF) report on terrorism financing, charities and nonprofit organizations are often vulnerable to terrorist financing because they: (Select Two.)
An international bank is headquartered in Madrid, Spain, with an office in New York City (NYC), US. The Madrid office is investigating a transaction originating from a customer of the NYC office and inquires whether the NYC office can share any relevant further information on the individual. Upon further research, the NYC office finds that they have filed a Suspicious Activity Report (SAR) on the individual in the previous year.
Which factors need to be considered before sharing the requested information? (Select Two.)
In which of the following situations would it be most crucial for the designated AML compliance officer of a company to perform a complete review of the company's AML program, including identifying the risks and commensurate controls?
Alegal instrument executed between two nationsthat governscross-border information sharingis known as a:
How do nominees benefit criminals misusing thorn for money laundering purposes? (Select Two.)
The compliance officer at a casino in Taiwan discovers that the casino received multiple cash deposits from a customer just below the Large-Amount Transaction Report (LTR) limit on consecutive days. The customer used three different betting accounts.
What is the appropriate next step?
Public-private partnerships (PPPs) that involve the sharing of information between law enforcement authorities, Financial Intelligence Units (FIUs), and the private sector are established to: (Select Two.)
A financial crimes risk appetite statement describes:
To ensure the independence of an audit for an AML program those involved in the audit would best be described as being:
Which collective body of Financial Intelligence Units (FlUs) was formed with an objective to improve Information exchange and sharing mechanisms among member FlUs as well as to support its members by enhancing their capabilities'?
AnAML compliance officerreceives anindependent audit reportwith a number offindings.
Anappropriate responseto thereportwould include:
AnAML compliance officeris drafting plans toaddress deficiencies identified in an independent audit.
Which approach is thebest option?
A customer puts high-denomination cash notes into a poker machine at a casino. Without placing any bets, the customer collected winnings in the form of a check from the casino.
Which money laundering threats could result from the customer's activities?
Which of the following statements istrueregarding the2012 Financial Action Task Force (FATF) 40 Recommendationsand/or11 Immediate Outcomes?
Abank is preparing for a regulatory examafter a previousregulatory exam identified weaknesses in its AML program. Since the last exam, the bank has:
Improved its written AML program
Hired an experienced AML compliance officer
Demonstrated a stronger culture of compliance
Focused on clearing its transaction monitoring case backlog and enhancing its sanctions screening program
Which of the followingare correct? (Select Two.)
Alegal instrumentexecuted betweentwo nationsgoverningcross-border information sharingis called a:
Which statements relate to the role of financial intelligence units (FIUs) in combatting financial crime on a national and international level? (Select Three.)
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.)
What is a key objective of the Egmont Group?
Which three actions should employees be instructed to do during an internal investigation?
A compliance officer provides an overview of the bank’s anti-money laundering program to a group of new
tellers during employee orientation.
Which training element should be delivered to this audience?
A financial institution files a suspicious transaction report on a customer as the result of a high volume of large currency deposits to pay off a loan. A law enforcement officer calls the anti-money laundering officer to discuss the suspicious transaction report. Which of the following is the anti-money laundering officer legally permitted to do?
1. Discuss any aspects of the reported activity.
2. Provide copies of the customer's loan documents.
3. Explain the customer's loan payment history.
4. Send the deposit documents referenced in the suspicious transaction report.
A new compliance officer is reviewing the bank’s anti-money laundering program and notices that the risk assessment was completed six months ago. Since that time, the bank acquired another financial institution, renamed
the internal records group, and streamlined cash handling procedures.
Which factor causes the compliance officer to update the bank’s risk assessment?
Historically, which vehicle is most often used to hide beneficial ownership?
Which insurance product is particularly vulnerable to money laundering?
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?
Which three should real estate agents include in the criteria to assess their company’s potential money laundering and terrorist financing risks when implementing a reasonable risk-based approach?
What was cited by the Wolfsberg Group in its Statement on the Suppression of the Financing of Terrorism as being vulnerable to terrorist financing?
A compliance officer learns from an Information Technology (IT) source of a potential new financial service being discussed by the new product approval committee.
What is the correct next course of action?
As a result of an audit, a policy exception was identified that had been approved by the compliance officer.
The auditor determined that the policy exception is a violation of a regulatory requirement.
What should the auditor do?
Which method is used to launder money in casinos?
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.)
A customer brings $15,000 worth of chips into a casino and plays various games. The customer redeems all
the remaining chips and requests a wire transfer of the proceeds to an unrelated third party.
What are two red flags that indicate money laundering? (Choose two.)
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 junior account manager within an international private bank in Country A was asked by one of his valued customers, who has held an account for several years in the institution, about depositing a large sum of cash into her account. The junior account manager informed his customer that his bank does not accept cash. The junior account manager later reviewed a customer activity report and noticed a number of smaller dollar wires from banks in neighboring Country B, which has lax currency controls, that totaled about as much as the customer intended to deposit.
What should the junior account manager do?
An account officer who maintains an excellent relationship with the finance manager for a correspondent bank customer learns that many records for the correspondent bank have been requested by law enforcement. In the interest of maintaining a good relationship with the customer, the account officer sets up a meeting to discuss the legalrequest with the customer. The account officer intends to discuss points related to the investigation during the meeting.
What should an anti-money laundering specialist recommend?
What does the Financial Action Task Force 40 Recommendations address on transparency of beneficial ownership?
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?
Under which two circumstances may law enforcement be given access to a financial institution customer’s
financial records? (Choose two.)
A compliance officer identifies a potentially significant risk in a popular financial product. Further investigation
reveals there is no mitigating control.
Which course of action should the compliance officer take?
The compliance officer at a crowd funding website is in charge of monitoring new crowd funding projects.
Recently, the number of crowd funding projects has significantly increased.
Which red flag indicates the highest anti-money laundering risk?
A banker in the credit department wants to assess the risk of all customers, and contacts the compliance officer to request a list of customers with suspicious transaction report filings.
What should be done to protect suspicious transaction report information?
A customer has held an account at a local credit institution for 10 years. The account has received deposits twice weekly for the same amount and has never shown signs of suspect behavior. Monitoring software indicated that in the past few months the account has received several large deposits that were not in line with the account history.
When asked, the customer states she recently sold a piece of property, which is supported with a proof of sale.
Which of the following should the compliance officer do next?
An offshore company is owned by four equal partners that reside in separate jurisdictions. One partner presents an authenticated power of attorney apparentlyexecuted by the remaining three partners in his favor and requests that a bank account be opened on behalf of all partners. He needs this done quickly because there is a large deposit pending. The account-opening officer contacts the bank's anti-money laundering officer for advice. Which of the following should the anti-money laundering officer advise as an initial step?
Which of the following reflect money laundering risk indicators in relation to a securities account?
1. A high level of activity in that securities account immediately followed by a high volume of securities transactions.
2. Frequent wire transfers into an account immediately followed by debit card transactions.
3. Frequent wire transfers into an account immediately followed by checks (cheques) or other payment instruments drawn on the account.
Which requirement is included in the Fourth European Union Directive on money laundering?
The compliance officer for a bank is reviewing on-boarding documents for a new business account for a
domestic corporation. The officer is unable to verify the identity of the beneficial owners of the company. Only
information on the nominee owners was provided, and none of the listed addresses are local. The purpose of
the business and future expected activity were disclosed to include cash letters, money orders and
international remittance transfers.
Which red flag identifies a heightened money laundering risk?
In general, what is an element that a financial institution or business does not have to specifically address in an anti-money laundering program?
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 three methods are commonly used by an accountant to launder money? (Choose three.)
A customer comes into the bank and appears to be ill-at-ease waiting in the teller line. When the customer gets to the teller, he become exceedingly nervous and asks for a large cashier’s check to be cashed and disbursed to him in $100 bills.
What should the teller do after completing the transaction?
Which action does the Financial Action Task Force (FATF) recommend be taken against jurisdictions that
have strategic deficiencies?
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?
An anti-money laundering specialist has been asked to create internal anti-money laundering policies, procedures and controls for a recently chartered offshore financial institution.
Which three should be included? Choose 3 answers
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
According to the Financial Action Task Force 40 Recommendations, Designated Non-Financial Businesses and Professionals include which entities?
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.)
With which of the following should an anti-money laundering officer coordinate when implementing anew hire screening program?
When a bank performs a risk assessment, what areas should an institution focus on?
On who does the ultimate responsibility for an institution’s anti-money laundering program rest?
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 of the following represents the first Financial Action Task Force initiative?
An anti-money laundering specialist is concerned that several suspicious transaction reports will discuss potential illegal activity of bank employees. In this situation, which of the following is the immediate concern for the institution?
A bank’s anti-money laundering section receives an anonymous tip that a customer might be engaging in
possible money laundering.
Which two facts should be considered during the course of an investigation into this matter? (Choose two.)
In which two ways does a government Financial Intelligence Unit interact with public and private sectors?
(Choose two.)
What do Financial Action Task Force (FATF)-style regional bodies do for their members to help combat money
laundering and terrorist financing?
Bank A is located in Country A. A wire transfer from Bank B located in Country B is processes by Bank A,where the funds are being moved to a customer at Bank C located in Country C. The wire transfer isdeemed suspicious by Bank A.
In which situation can money laundering adversely affect a country’s currencies and interest rates due to launderers investing dirty funds?
Which method do terrorist financiers use to move funds without leaving an audit trail?
What is a major economic consequence of money laundering through the use of front companies?
A U.K. real estate agent has three foreign clients interested in purchasing an apartment building, valued at £30
million, in the outskirts of London as an investment property. The clients are not willing to have their names
provided to the bank. The clients want to purchase to be made in the names of three private companies for
privacy reasons. The plan is to wire the funds into an account held in the name of another private company at
a bank in London.
Which red flag should stop the agent from discussing this potential purchase further?
According to the Financial Action Task Force 40 Recommendations, simplified customer due diligence or reduced measures could be acceptable for which of the following types of products or transactions?
1. Life insurance policies where the annual premium is no more than USD/EUR 1,000 or a single premium of no more than USD/EUR 2,500.
2. Insurance policies for pension schemes if there is no surrender clause and the policy cannot be used as collateral.
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4. Trusts where the settlor, trustee and beneficiaries are identified and the shares are in bearer form.
To ensure compliance with economic sanctions established by governmental authorities in the jurisdictions
where it operates, a financial institution requires that all new and existing customers be screened at
onboarding and quarterly thereafter.
Is this step sufficient to ensure compliance?
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?
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?
Historically, a tour guide has made monthly cash deposits averaging $10,000. Over the past three months, the
monthly deposits have averaged $100,000. When the financial institution QUESTION NO:s the increased deposits,
the tour guide explains that there have been numerous conventions in town so business has increased
substantially.
Which further action(s) should the financial institution take?
What describes the Black Market Peso Exchange money laundering method?
A compliance officer at an insurance company has been reviewing the transaction activity of several clients.
Which transaction is considered a red flag for potential money laundering?
A bank account is established for a new business customer. The business was established five years ago with an address in another state. The business website contains few details other than stating it is a real estate business.
One principal has an international telephone number and appears to be living in another country. The other principal works out of a recreational vehicle.
What warrants enhanced due diligence in this scenario?
How should a financial institution deter money laundering through new accounts? Choose 3 answers
Which three entities does the Third European Union Money Laundering Directive apply to?
In relationship to life insurance business, the third European Directive states that Member States may allow the identity verification of the beneficiary under the policy after the business relationship has been established, but before which events?
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?
A compliance officer for a casino may suspect money laundering if an individual:
Which primary international authoritative body designates sanctions?
Which response represents a high-level principle for FATF-Style Regional Bodies (FSRB)?
The local manager of a remote mortgage origination department of a financial institution has just discovered that sanctions screening of new customers is not being performed.
Which action should the local manager take in this situation?
Which are the two most common controls a financial institution (FI) uses to identify suspicious money-laundering activity? (Choose two.)
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
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?
One key aspect of promoting an enterprise-wide compliance culture within a financial institution (FI) is that the:
What poses the greatest money laundering risk for a financial institution offering on-line services to customers?
To ensure that an institution’s anti-money laundering program is current, which step should be taken?
How can a ‘free-look provision’ as part of a life insurance policy help criminals to launder money?
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?
A profitable commercial customer who operates an import-export business has multiple accounts with the same institution at branches m different locations. The customer receives funds from a jurisdiction perceived as highly corrupt according to Transparency International ratings. The customer makes frequent transfers among the accounts and prefers to manage the accounts separately. What should the institution do to mitigate the risk associated with these accounts?
Which action should financial institutions with cross border correspondent banking activity be required to perform according to the Financial Action Task Force 40 Recommendations?
A financial institution (FI) is being investigated for possible money laundering. When cooperating with law enforcement agencies, which additional steps should the FI ensure are taken? (Choose two.)
What should an effective anti-money laundering training program include?
Who has the day-to-day responsibility of communicating and reinforcing the established anti-money laundering compliance culture and program?
A client who owns a swimming pool company requests to open 19 accounts at a bank, each with a debit card for its swimming pool technicians. When asked about the purpose of each account, the client explains that each technician needs a separate checking account to purchase pool chemicals.
Which available source could be used in the bank’s internal investigation on this client’s activities?
In addition to monitoring for suspicious activity, what are electronic monitoring systems also valuable for?
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.)
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 are three indicators of money laundering associated with using electronic funds transfers? Choose 3 answers
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?
Enhanced due diligence (EDD) may be bypassed for which situation?
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.)
Financial Intelligence Units (FIUs) are responsible for:
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.)
Which three areas do FATF’s 40 recommendations cover? Choose 3 answers
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 benefit of using bearer shares in corporate formations is that bearer shares are:
A financial institution has expanded its scope of services so that it is attracting the business of politically exposed persons (PEPs) who had previously never been part of the customer base.
Which two courses of action should the compliance officer include in the institution’s procedures for considering PEPs as customers? (Choose two.)
Which step should be taken to understand the types of financial institutions to whom the services are being offered when a correspondent bank permits “nested” relationships according to the Wolfsberg Group?
Bank A is located in Country A. A wire transfer from Bank B located in Country B is processes by Bank A, where the funds are being moved to a customer at Bank C located in Country C. The wire transfer is deemed suspicious by Bank A.
Who should Bank A file a suspicious transaction report on?
A quarterly review is conducted on a retail customers 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 accounts historical profile. A suspicious transaction report will most likely be filed if what also occurred?
When providing reporting of STRs to the board, which of the following should be provided?
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 statement about a multinational institution’s ability to fully investigate unusual activity in all its foreign operations is correct?
Which statement identifies one of the duties of a government Financial Intelligence Unit?
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?
A precious metals dealer opens a new account with a bank. Which requires a referral to AML Investigations for further review?
A compliance officer is conducting a review of the automated transaction monitoring system. What would be most likely to result in a change in the monitoring system parameters?
Which activity would require an update to the first line training program?
An auction house dealing in fine art and antiques sells a well-known painting at a price of $12 million to an agent bidding for a group of local investors. The same painting sold ten years prior at auction for $5 million. The auction house receives payment for the painting via wire transfer from an account maintained in an offshore jurisdiction by the investor group. No beneficial ownership information is available for the account.
What are the two money laundering red flags? (Choose two.)
A compliance officer is tasked with implementing an enterprise-wide anti-money laundering program for a bank, which operates in multiple countries. Not all the bank products and services are available in all countries.
Which three factors should be considered as part of the approach? (Choose three.)
Which situation is the highest risk for money laundering and terrorist financing activity?
OFAC-issued regulations apply to which entities? (Choose two.)
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?
Bank A is a non-United States (U.S.) bank that has $5 million in a correspondent account at a bank in New York City. The Worldwide Terrorist Syndicate (WTS) has $1 million in its account at a non-US branch of Bank A. The U.S. government has initiated forfeiture action against the WTS.
Which potential action can the U.S. take under the USA PATRIOT ACT pursuant to the issuance seizure warrant?
What are four key elements that a KYC program should contain according to the Basel Committee requirements?
According to the Second European Union Money Laundering Directive, what may knowledge of criminal conduct be inferred from?
A comprehensive set of risk-based guidelines for maintaining business relationships is being developed.
Which situation indicates that the institution should terminate the relationship with a client?
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?
How should a compliance officer respond to law enforcement agencies' request for information on a customer undergoing an investigation?
Which element is generally required of all anti-money laundering programs?
Which factor should a financial institution (FI) consider prior to sharing customer records within the same jurisdiction?
What is an aspect of the USA PATRIOT Act that has extraterritorial reach?
What do the Financial Action Task Force (FATF) mutual evaluations of each member assess?
A potential client calls a broker-dealer wishing to purchase securities. The client does not appear to be concerned with any fees associated with the account or price of the securities. Further information provided by the potential client indicates the individual may have relatives working for a company in which the potential client wants to invest. Which type of activity is the potential client attempting to commit?
A financial institution accepts new on-line customers. After customers have provided acceptable identification, the institution should next
Which of the following activities is most likely associated with a lawyer participating in a money laundering scheme?
A foreign bank's compliance officer receives a request for information from a US bank, alerting the foreign bank to the possibility that it may have transferred funds on behalf of an Office of Foreign Assets Control (OFAC>-sanctioned person, who holds an account with the foreign bank. Which statements are true with respect to said funds and the information in relation to the transaction under scrutiny? (Select Two.)
Which trading pattern may be indicative of money laundering in capital markets?
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 primary purposes of Financial Action Task Force {FATF)-Style Regional Bodies? (Select Two.)
The Wolfsberg Group has issued a number of documents since its inception aiming to:
The law enforcement agency (LEA) of a foreign jurisdiction contacts a financial institution (Fl) regarding one of the Fl's clients. The LEA advises that the client is currently wanted for prosecution as a result of a series of human trafficking charges. What should the Fl do? (Select Two.)
Which are characteristics of Mutual Legal Assistance Treaties (MLATs)? (Select Three.)
Which private banking situation requires due diligence actions to be implemented according to the AML principles of the Wolfsberg group?
Which type of sanctions are likely to be used first in order to avoid escalating violent conflicts and/or proliferation of weapons?
Under the Egmont Group Principles, information exchange among financial intelligence units (FlUs) should be conducted:
Which test should be included in a bank's Office of Foreign Assets Control sanctions screening audit program?
A relationship manager in a bank has had a private banking customer for 10 years. The customer has business accounts and investments and seeks advice on the creation of a company overseas. The relationship manager refers the customer to the commercial banking manager and vouches for the customer. Which of the following risk factors is the most important?
Which are red-flag indicators of possible money laundering through online gambling? (Choose two.)
Which of the following customer activities poses the highest risk of money laundering?
An EU Trust and Company Service Provider (TCSP) analyst notices some unusual activity while looking through a customer's financial statements and detailed general ledger. The customer is in the business of importing and exporting machineries. Which transaction indicator warrants further escalation to the compliance officer?
Which is a FATF characteristic used to assess a country's effectiveness of its AML regime?
Money laundering can cause which consequences for a financial institution? (Select Two.)
Which is the first valid step in the Mutual Legal Assistance Treaties (MLAT) international cooperation process?
A customer runs an export business for agricultural products. There has been steady growth over the years from sales to the Caribbean region. A sudden increase is noted in this customer's account balances during the last month.
On what grounds should an anti-money laundering specialist prepare a suspicious transaction report?
What is a primary responsibility of a financial intelligence unit?
Which information should be gathered as part of enhanced due diligence (EDD) for a high-risk customer?
A financial institution opens a mortgage loan for a customer. During a subsequent internal review of the loan, it was noted that the appraisal used to support the loan was performed by an appraiser who was not on the institution's approved appraiser list. This exception was approved by the senior loan underwriter. The reviewer, who had examined other loans from the same general area, noted that the value on the loan appeared significantly higher than on other comparable properties. Which of the following should the anti-money laundering specialist recommend next?
The most important anti-money laundering issue associated with on-line banking is accurately
Which are the requirements of the Filth AML Directive of the EU? {Select Two.)
Which reputations risk consequence could a financial entity face for violating AML laws?
Why should a financial institution (Fl) require an update of its AML risk assessment?
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.)
Which type of sanctions are most likely to be used in order to avoid escalating violent conflicts and/or proliferation of weapons?
Which principles of the Egmont Group of Financial Intelligence Units (Fills) are aimed at maximizing cooperation between FlUs to more effectively combat money laundering? (Select Two.)
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?
A compliance officer of a financial institution is reviewing a payment for sanctions compliance between two parties in Europe and Asia. The payment is in Euros and involves the provision of services to a company located in a jurisdiction subject to Office of Foreign Assets Control secondary sanctions. Which factor is most important in determining the compliance officer's response?
An account officer who maintains an excellent relationship with the finance manager for a correspondent bank customer learns that many records for the correspondent bank have been requested by law enforcement. In the interest of maintaining a good relationship with the customer, the account officer sets up a meeting to discuss the legal request with the customer. The account officer intends to discuss points related to the investigation during this meeting. Which of the following should an anti-money laundering specialist recommend?
Based on studies executed by the Organization for Economic Cooperation and Development (OECD), which occupations are particularly vulnerable to the use of false identities and identity theft?
A large cash deposit most likely reflects money laundering when it is
1. from a customer who has never conducted a transaction in cash before.
2. transacted in segments smaller than the reporting thresholds at various times during the day.
3. followed by an immediate wire transfer to an offshore secrecy haven.
4. by a customer who operates a cash-based business.
Potential indicators of money laundering associated with Trust and Company Service Providers include: (Select Two.)
Which of the following is considered a shell bank as defined by the USA PATRIOT Act?
The recommended way lot a financial institution to respond to a request from a law enforcement agency is to:
According to the Basel Committee's principles on customer due diligence, a bank should:
Which constitute red flags in connection with a company involved in illegal logging? (Select Three.)
The most effective tool used to detect structured transactions is
Which are red flags indicating potential engagement of a bank employee in money laundering? (Select Two.)
Once a financial institution has reported suspicious transactions on a valued customer, it should cooperate with competent authorities by
A new business opened an account at a bank. After a month of activity, the account is referred to AML Investigations for potential human trafficking activity. Which red flags most likely triggered the referral? (Select Two.)
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?
One of the red flags of microstructuring is:
Historically, which of the following vehicles is most often used to hide beneficial ownership?
How should law enforcement obtain documentation from an institution when suspicious activity was identified? (Choose two.)
What correspondent banking risk factor increases the risk for a Correspondent Bank?
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 7.52 million USD. Shortly thereafter, the client's father became president of Country B During a routine client review two years later, it was identified that the client's wealth had grown to 510 million USD. Which are two red flags that indicate money laundering or financial terrorism? (Select Two.)
What national agency is responsible for analyzing and assessing the information it receives to substantiate possible existence of money laundering or terrorist financing activities?
How does the Egmont Group assist financial intelligence unit members to accomplish their goals? (Select Three.)
What reputational risk consequence could a financial entity face for violating AML laws?
A prospective client walks into an accounting firm wanting to incorporate a company. The accountant feels uncomfortable after the meeting. Which two of the accountant's observations warrant escalation to the compliance officer? (Select Two.)
According to Basel Committee on Banking Supervision guidelines, which of the following statements best describes the relationship between the internal audit function and compliance?
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?
Under the Wolfsberg Correspondent Banking Principles, which action is considered an enhanced due diligence obligation to correspondent banking clients that present greater risks?
According to the Basel Committee on Banking Supervision, banks should deal with high-risk customers by: