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.)

The customer is issuing a number of wires to several relatively high-risk jurisdictions

The customer's account has had a large volume of activity, but the month-end balance is usually low

The customer has had a long-standing account at the bank

The customer in on the exempt list for currency transaction reporting requirements

The customer is issuing a number of wires to several relatively high-risk jurisdictions

The customer's account has had a large volume of activity, but the month-end balance is usually low

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.)

Compare the wire transaction as it enters and after it leaves the bank

Check for suspicious phrases usually used to conceal originator or beneficiary identity

Compare the wire transaction as it enters and after it leaves the bank

Check for suspicious phrases usually used to conceal originator or beneficiary identity

Identify large incoming wire transactions received on behalf of a foreign client with no explicit reason

Identify wire transaction activity to or from a financial institution located in a higher risk jurisdiction

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?

Large cash transaction reporting procedures

Results of recent risk assessments

Large cash transaction reporting procedures

The financial institution's surprise cash audit policy

Past check fraud losses incurred by the financial institution

Which red flag indicates high potential for money laundering in a real estate purchase?

The purchaser had a previous bankruptcy

The purchaser owns a cash intensive business

The purchaser is not a resident where the property is located

A compliance officer at a small community bank has been asked to review existing customer onboarding policies and procedures to ensure they adequately address anti-money laundering risks.How should customer due diligence be implemented?

As an ongoing activity that may vary commensurate with the risk profile of the customer

With an annual compliance review and approval of customers

With a one-time event conducted at initial customer onboarding

As an ongoing activity that may vary commensurate with the risk profile of the customer

As applicable to customers that pose higher money laundering or terrorist financing risk

A bank compliance officer discovers cash deposit activity inconsistent with the expected and historical cash activity within the personal accounts of the chairman of the board. The cash activity appears structured to avoid the local legal filing requirements for large cash transactions, and a suspicious transaction report (STR)was filed.How should the compliance officer report the filing of the STR to the board of directors without revealing the existence of the filing to the subject?

Follow the financial institution's established STR reporting policy

Inform the legal counsel of the bank

Follow the financial institution's established STR reporting policy

Notify the financial institution's regulator to disclose the activity

The compliance officer and the chief executive officer should jointly interview the chairman

Under which two circumstances may law enforcement be given access to a financial institution customer's financial records? (Choose two.)

If law enforcement serves a legal summons or subpoena

If law enforcement has circumstantial evidence to suspect money laundering

If the person is named in a suspicious transaction report

If law enforcement serves a legal summons or subpoena

If the investigation of a customer is made public in the media

If law enforcement has circumstantial evidence to suspect money laundering

What must be materially true regarding transactions for United States (U.S.) sanctions laws to have jurisdiction?

Transactions are processed by a U.S. person

Transactions are traced to illegal proceeds

Transactions are processed by a U.S. person

Transactions are stripped of beneficial owner information

Transactions are identified as proceeds of foreign corruption

How does the Financial Acton Task Force (FATF) communicate its findings regarding jurisdictions with strategic anti-money laundering / Counter Financing of Terrorism deficiencies?

By issuing two formal documents three times per year

By issuing documentation to the private sector

By issuing two formal documents three times per year

By issuing informal communication to FATF members

By issuing four formal documents to the deficient jurisdictions

A corporate services provider in a European Union (EU) country has a prospect from an African country who deals in oil and gas. The prospect intends to develop an oil terminal in his home country with a $75 million dollar loan secured by a third party, which is a trust formed in a Caribbean island with a holding company based in a European secrecy haven. A young lady is presented as an ultimate beneficial owner who has gained her wealth through a fitness studio in her home country.What are two red flags that could indicate money laundering or financing terrorism? (Choose two.)

The guarantor company's ownership structure is overly complex

The ultimate beneficial owner is young lady who has gained her wealth through a small business

A loan worth $75 million with a third-party guarantor

The guarantor company's ownership structure is overly complex

The prospect wishes to have a corporate structure with a holding company in EU country

The ultimate beneficial owner is young lady who has gained her wealth through a small business

The anti-money laundering compliance officer for a small money transmitter has several agent locations in the same geographic area in the United States. The customers are immigrants from Country A and the majority of the funds are remitted to Country A.In a meeting with one of the agents, it is recently discovered that two new customers have been coming in three times a week and sending funds to the same recipient in Country B. Each cash transaction always totals exactly $8,000.What should alert the agent to possible money laundering activity by the two customers?

Each of their transactions is just below the cash reporting threshold

They remit funds to the same person

They have been coming in three times a week

It is unusual for customers to remit to Country B

Each of their transactions is just below the cash reporting threshold

A bank receives an anonymous tip from an employee about another employee through its confidential hotline.Which activity warrants further review?

A teller distributes bank brochures to customers who regularly conduct cash transactions below reporting limits

A mortgage officer works with home loan applicants to resolve adverse credit issues

An employee in bookkeeping accepts funds transfer requests from customers via telephone

An employee in accounting works with customers to help understand how to reduce service charges

A teller distributes bank brochures to customers who regularly conduct cash transactions below reporting limits

A bank located in New York has identified suspicious transactions at a correspondent bank in ChinA. For one of the international customers, the correspondent bank is not following agreed upon protocols.Which factor indicates that the bank should terminate the relationship?

The correspondent bank has opened branches in a country on the Office of Foreign Assets Control list.

The compliance officer at the correspondent bank is currently being investigated due to bribery allegations.

The correspondent bank has recently exceeded acceptable limits in the primary banks' recently developed risk model.

The primary institution has requested transactional details from the correspondent bank to aide in their investigation.

Which two channels can be utilized during a cross-border money laundering investigation to assist in gathering information according to Financial Action Task Force? (Choose two.)

Contacting existing liaison officers in the foreign jurisdiction

Exchanging information between national law enforcement agencies

Contacting existing liaison officers in the foreign jurisdiction

Exchanging information between national law enforcement agencies

Contacting the potential suspect or their family members to request information

Submitting only formal requests for information to a financial intelligence unit

During a law enforcement investigative interview regarding potential money laundering, the suspect starts making assertions and statements that the investigator believes are false.How should the investigator respond?

Ask question of a material nature about the suspected false statements without revealing the suspected deception

Inform the suspect that deception is obvious and continue the interview

Advise the suspect that the interview will be terminated if there is suspicion of deception

Direct the interview in another direction until there is better rapport before returning back to the troubling question

Ask question of a material nature about the suspected false statements without revealing the suspected deception

A customer has held an account at a bank and has lived locally for over 25 years. Historically he has come into the bank monthly to deposit a $1,500 retirement check from the company where he worked. He is well known at the bank and often brings the staff cookies. Over the past four months, he has come into the bank every Monday, Wednesday, and Thursday to make $3,000 cash deposits into his account. A review of his account shows that an $8,500 check made out to cash clears his account each week. The bank has decided to file a suspicious transaction report (STR).What is the important fact to include in the STR?

The recent change in the timing of deposits and withdrawals in the account

The customer's work history and the amount of his monthly retirement check

The fact that the account holder is well known to the bank staff

The fact that the customer has lived in the area and has banked at this bank for 25 years

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?

Instruct the compliance officer to develop a plan to remediate the institution's anti-money laundering program

Terminate the compliance officer and staff

Purchase and install a new suspicious activity monitoring system

Hire an attorney with instructions to protest the enforcement action

Instruct the compliance officer to develop a plan to remediate the institution's anti-money laundering program

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?

Decline to provide the suspicious transaction report information to the credit department

Provide the suspicious transaction report information to the credit department

Decline to provide the suspicious transaction report information to the credit department

Seek approval from the board of directors to disclose the suspicious transaction report information

Contact the credit department manager to determine how the suspicious transaction report information can be provided

Which two aspects of precious metals pose the highest risk of money laundering? (Choose two.)

Some precious metals can be formed into other objects, making easier to transport

Precious metals have high intrinsic value in a relatively compact form and are easy to convert into currency

Some precious metals can be formed into other objects, making easier to transport

Precious metals have high intrinsic value in a relatively compact form and are easy to convert into currency

The value of precious metals can be inflated easily, making it easy to increase the amount of money laundered

Precious metals can be readily used in many high-tech commercial applications, making them all the more valuable

Which two methods have terrorist groups used to diversify their revenue stream and to fund their operations?(Choose two.)

Engaging in wire transfer activity

Which two statements are true regarding the European Union Money Laundering Directives? (Choose two.)

They apply to member states of the European Union

They require member states to enact laws and/or regulations to comply with the directives

They apply to member states of the European Union

They require member states to enact laws and/or regulations to comply with the directives

They set forth non-binding best practices for financial institutions within the member states

They have extraterritorial impact and apply to states that have diplomatic relations with member states

A compliance officer was recently reviewing transactional data for an international charity and found transactions that present a higher risk.Which reason is cause for terminating the banking relationship?

The charity is headquartered in a country on the Office of Foreign Assets Control list

The charity has had a high a high turnover rate of official positions

The charity has several incoming international funds transfers

The flow of funds both in and out are complex and hard to trace

The charity is headquartered in a country on the Office of Foreign Assets Control list

Which action does the Financial Action Task Force (FATF) recommend be taken against jurisdictions that have strategic deficiencies?

Add the jurisdiction to the United Nations' list of sanctioned jurisdictions

Create an action plan to address the deficiencies without the support of the FATF

A client opens a bank account for a multi-level marketing company. The debits and credits of the account are numerous and very involved. Further, there are a lot of international transactions. Also, funds are being tunneled from the company to the client's personal account in another jurisdiction.Which two steps should law enforcement take in investigating this matter? (Choose two.)

Determine who are the signatories on the account

Examine the flow of money from the company to the individual in an effort to determine if it is legitimate

Determine who are the signatories on the account

Ask the bank for the history of this multi-level marketing company

Examine the flow of money from the company to the individual in an effort to determine if it is legitimate

Examine possible Suspicious Activity Report information received from the local Financial Intelligence Units

Which method is used to launder money via wire remittances sent through a bureau de change or money services business?

A customer in country A makes frequent wire transfers to a single customer in country B that are slightly under the legal reporting threshold.

A customer in country A makes a weekly small wire transfer to the bank account of an individual in country B.

A customer in country A makes frequent wire transfers to a single customer in country B that are slightly under the legal reporting threshold.

A large number of wire transfers are sent from a large number of senders in country A to a large number of recipients in country B during the period of December 1 to December 15.

A customer in country A receives four small wire transfers from four different individuals located in country B on December 21. The aggregate of the wire transfers falls below the legal reporting threshold.

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 QUESTIO N N O :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?

Perform further investigation, it appropriate report the activity to the authorities and consider terminating the relationship

Immediately terminate the relationship

Schedule a periodic review of activity

Perform further investigation, it appropriate report the activity to the authorities and consider terminating the relationship

Perform further investigation, if appropriate report the activity to the authorities and place a limit on future transactions

A bank employee recently opened an account for a new restaurant. Daily cash deposits over a three-month period are close to $9,500.What are two red flags that indicate possible money laundering or terrorist financing? (Choose two.)

The daily cash deposits are so close in amount

The new account demonstrates a steady flow of income

The restaurant is located in a different city

The daily cash deposits are so close in amount

It is a new account that has daily cash deposits

The new account demonstrates a steady flow of income

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.)

The transactions are to, or go through, a blocked entity

Those that are by, or on behalf of, a blocked individual or entity

Those that are in connection with a transaction in which a blocked individual or entity has an interest

The transactions are to, or go through, a blocked entity

Those that are by, or on behalf of, a blocked individual or entity

Those that are by or on behalf of a blocked individual and a licensed entity

Those that are in connection with a transaction in which a blocked individual or entity has an interest

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?

No, screening should occur promptly after list updates

Yes, this is recommended by the international guidance

No, it is necessary to screen and perform enhanced due diligence on new relationships

Yes, screening all existing customer relationships ensures the institutions is not dealing with a sanctioned individual or entity

What are two requirements of United States financial institutions when conducting business with an international institution as a result of the USA PATRIOT Act? (Choose two.)

Performing enhanced due diligence on shell banks

Performing due diligence on correspondent accounts

Performing enhanced due diligence on shell banks

Performing due diligence on correspondent accounts

Visiting the head office of the international financial institution

Complying with Special Measures issued under the USA PATRIOT Act

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?

Only if the U.S. bank is involved in the funds transfer

Only if a U.S. person or entity is the ultimate beneficiary

Only if a non-U.S. person or entity is the ultimate beneficiary

Only if the U.S. bank's correspondent informs it of the involvement of the designated party

A law enforcement agent calls a bank anti-money laundering investigator for supporting information about a suspicious transaction report that was filed the previous month.How should the investigator respond?

Refer the agent to the bank's compliance officer

Send the information to an address provided by the agent

Share the requested information during the telephone call

Require a search warrant before releasing the information

A client is a wholesale auto business that operates as a used car lot. The client regularly ships vehicles internationally. In a four-month period, the client received wires totaling $ 1,250,000 from a dealer in Benin inWest AfricA. All wires originated from Benin and were in increments of $50,000.Account debits made to the account were payable to various transport companies. All incoming checks reference various vehicles purchased. Dock shipping receipts produced by the client to support account activity identify the vehicles but cannot easily be tied to the wires receives.What is the suspicious behavior?

Wires received are in large, even dollar amounts

The dock shipping receipts match the vehicles

Vehicles are regularly shipped internationally

Wires received are in large, even dollar amounts

Account debits are payable to transport companies

ACAMS CAMS Practice Test 3 - Free Online Exam Prep & Questions

Question 1 / 40

Which method is used to launder money in casinos?

Purchase chips with cash and play at a table

Purchase chips with cash and redeem for cash

Purchase chips with cash and redeem for a check

Purchase chips with cash and sell to another person for cash

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