CAMS Online Practice Questions and Answers

After an institution files an STR with regard to a particular account, a law enforcement agent requests the institution to keep the account open until advised otherwise by law enforcement.

What steps should the institution take?

A. The institution should close the account in order not to be caught in the middle of a law enforcement investigation

B. The institution should follow the request ofthe law enforcement agent and keep the account open

C. The institution should request a written letter from the law enforcement (agency signed by an appropriate authorized signature

D. The institution should keep the account open only if doing so comportswith the bank's own AML procedures

What is a major money laundering risk associated with a number of prepaid cards as opposed to credit or debit cards?

A. The risk of losing the prepaid cards

B. The inability to load the card with cash

C. The global access to cash through ATMs

D. The anonymous access to funds

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?

A. Perform due diligence on the beneficiary

B. Determine the source of wealth and source of funds

C. Decline the request if the beneficiary is a foreign PEP

D. Decline the request to add a beneficiary due to increased risk

A money service business (MSB) has implemented an automated transaction monitoring system. Upon reviewing an alert, an analyst suspects the activity may be indicative of terrorism financing. Which additional information would indicate the alert should be escalated for further investigation?

A. The use of funds by a non-profit organization is consistent with the purpose for which it was established.

B. The raising of donations takes place in an official, registered manner.

C. Transactions in the name of an entity, a foundation, or association are linked to a trust fund.

D. A customer donates to an organization that is a sanctioned entity.

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. Financial impact on the institution if the account is closed.

B. Procedures to ascertain the potential risk to the organization.

C. Additional Administrative costs of monitoring the account.

D. Total number of accounts the institution closed in the last month.

The Board of Directors for a small private bank has asked the management to no longer apply the identity requirements for high net worth individuals to protect their privacy. Which of the following Financial Action Task =once 40 Recommendations should cause an anti-money laundering specialist the most concern?

A. Financial institutions should not warn their customers when information relating to them is being reported to the competent authorities.

B. Financial institutions should not keep anonymous accounts.

C. Financial institutions should maintain all necessary suspicious transaction report records on transactions, both domestic are international, for at least 5 years.

D. If financial institutions suspect that funds stem from criminal activity, they should be required to close the account.

A country that does not have strong predicate offenses and is lax in prosecuting AML cases could suffer which social/economic consequence?

A. US sanctions

B. Increased organized crime and corruption

C. Reputation risk for the port

D. Loss of tax revenue

The Wolfsberg Group has issued a number of documents since its inception aiming to:

A. provide a standardized process amongst its bank members for combatting money laundering and terrorist financing in private banking.

B. prevent money laundering or terrorist financing by establishing consistent regulatory standards across the EU.

C. provide advice to regulators around the world on the due diligence requirements for politically exposed persons.

D. provide financial institutions with an industry perspective on effective financial crime risk management.

Which is true about Financial Action Task Force (FATF)-Style Regional Bodies (FSRBs)?

A. FSRBs set standards for their member countries that supplement FATF's standards.

B. Tools used by FRSBs include training measures and mutual evaluations of its members.

C. AFATF-member country cannot also be a member of an FSRB.

D. To be a member of an FSRB, a country must have enacted AML and Anti-Terrorist Financing laws.

Which activity associated with new or developing technologies does the FATF recommend FIs pay special attention to?

A. Financial intermediaries performing transactions for customers

B. High volumes of cash transactions

C. Complex or unusually large transactions

D. Non-face to face business relationships or transactions