ACAMS CAMS Practice Test - Questions Answers, Page 11

Suspicious transaction report (STR) information is confidential and should not be disclosed to anyone outside the compliance function or law enforcement authorities. Providing STR information to the credit department could compromise the integrity of the reporting process and expose the institution to legal risks. The compliance officer should decline to provide the STR information to the credit department and explain the reasons for doing so.

CAMS Certification Package - 6th Edition | ACAMS, Chapter 4: Conducting and Supporting the Investigation Process, page 136

CAMS Certifications: How to Get CAMS Certified | ACAMS, Candidate Handbook, page 16

ACAMS CAMS Certification Video Training Course - Exam-Labs, Video 4.3: Suspicious Transaction Reporting

Exam CAMS: Certified Anti-Money Laundering Specialist (the 6th edition), Practice Test 1,

Precious metals, such as gold and silver, pose a high risk of money laundering because they have some features that make them attractive to criminals.According to the FATF Guidance on the Risk-Based Approach for Dealers in Precious Metals and Stones1, these features include:

Some precious metals can be formed into other objects, making easier to transport. For example, gold can be melted and shaped into jewellery, coins, bars, or other items that can be easily concealed and moved across borders. This makes it difficult for law enforcement and customs authorities to detect and seize the illicit proceeds of crime.

Precious metals have high intrinsic value in a relatively compact form and are easy to convert into currency. For example, gold has a stable and universal value that can be exchanged for cash or other assets in any market. This makes it easy for criminals to store, transfer, and launder their illicit funds without leaving a trace in the formal financial system.

The other two options, C and D, are not as relevant to the risk of money laundering. The value of precious metals is determined by the market forces of supply and demand, and it is not easy to inflate or manipulate it. Precious metals can be used in many high-tech commercial applications, but this does not necessarily make them more valuable or more prone to money laundering.

1: FATF Guidance on the Risk-Based Approach for Dealers in Precious Metals and Stones, 2008, https://www.fatf-gafi.org/en/publications/Fatfrecommendations/Fatfguidanceontherisk-basedapproachfordealersinpreciousmetalsandstones.html

2: Money laundering and terrorist financing risks and vulnerabilities associated with gold, 2015, https://www.fatf-gafi.org/en/publications/Methodsandtrends/Ml-tf-risks-and-vulnerabilities-gold.html

3: The anti-money laundering framework for precious stones and metals dealers in Singapore, 2021, https://www.emerald.com/insight/content/doi/10.1108/JMLC-07-2021-0074/full/html

4: Gold and Money Laundering, 2019, https://www.moneylaunderingnews.com/2019/04/gold-and-money-laundering/

Art and Antiquities: Conduits for Money Laundering and Terrorist Financing

Why Fight the Antiquities Trade?

More recently, groups like Daesh (Islamic State [IS]), al-Qaida, the Taliban and their affiliates have been engaged in ****cultural racketeering and terrorism in Iraq, Syria, Yemen, Afghanistan and elsewhere, converting patrimony into cash for weapons and troops****.

https://www.un.org/press/en/2015/sgsm17427.doc.htm

As Terrorists Diversify Fundraising Tactics, Greater Efforts Needed to Shut Down Illicit Channels, Secretary-General Tells Finance Ministers' Meeting

Terrorists continue to adapt their tactics and diversify their funding sources. Today, Da'esh runs a multi-million-dollar economy in territories under its control. Da'esh terrorists raise money through the oil trade, extortion, undetected cash couriers, kidnapping for ransom, trafficking of humans and arms and racketeering. They loot and sell precious cultural property, shamelessly profiting from the destruction of humanity's common heritage.

The European Union Money Laundering Directives (AMLDs) are issued periodically by the European Parliament to prevent money laundering and terrorist financing and establish a consistent regulatory environment across the EU1.They apply to all member states of the European Union and require them to enact laws and/or regulations to comply with the directives2.The directives are legally binding and set forth minimum standards and obligations for financial institutions and other entities within the member states3.The directives do not set forth non-binding best practices, but rather harmonize the AML/CFT rules and procedures across the EU4.The directives do not have extraterritorial impact and do not apply to states that have diplomatic relations with member states, unless they are part of the European Economic Area (EEA) or have equivalent AML/CFT regimes5.

The Office of Foreign Assets Control (OFAC) is a US agency that administers and enforces economic and trade sanctions based on US foreign policy and national security goals1.OFAC has a list of sanctions programs and country information for various regions and topics, such as Russia, Iran, North Korea, Cuba, and more2. If a charity is headquartered in a country on the OFAC list, it means that the US government has imposed restrictions or prohibitions on transactions or dealings with that country, its government, entities, or individuals. This poses a high risk of violating the sanctions regulations and exposing the bank to legal, regulatory, or reputational consequences. Therefore, the bank may decide to terminate the banking relationship with the charity to avoid such risks.

The other options are not sufficient reasons to terminate the banking relationship, as they may not indicate illegal or suspicious activities by the charity. A high turnover rate of official positions may be due to various factors, such as organizational changes, staff turnover, or personal reasons. It does not necessarily imply that the charity is involved in money laundering or terrorist financing. However, the bank should verify the identity and authority of the new officials and update the customer due diligence information accordingly. The charity may have several incoming international funds transfers because it receives donations or grants from different sources or countries. This is not unusual for an international charity, as long as the funds are consistent with its stated purpose and activities. The bank should monitor the transactions and report any anomalies or red flags to the relevant authorities. The flow of funds both in and out may be complex and hard to trace because the charity operates in multiple jurisdictions or sectors, or has a decentralized or layered structure. This may increase the risk of money laundering or terrorist financing, but it does not necessarily mean that the charity is engaged in such activities. The bank should conduct enhanced due diligence and ongoing monitoring of the charity's transactions and beneficiaries, and apply a risk-based approach to mitigate the potential risks.

'Countries can be subject to comprehensive or targeted sanctions. Comprehensive sanctions prohibit virtually all transactions with a specific country. Targeted sanctions prohibit transac-tions with specified industries, entities or individuals listed on OFAC's Specially Designated Nationals and Blocked Parties List. Failure to comply may result in criminal and civil penalties. FATF also maintains a list of jurisdictions identified as high-risk and noncooperative, whose AML/CFT regimes have strategic deficiencies and are not at international standards. As a result, FATF calls on its members to implement COUNTERMEASURES against the jurisdiction, such as financial institutions applying enhanced due diligence to business relationships and transactions with natural and legal persons from the identified jurisdiction in an attempt to persuade the jurisdiction to improve its AML/CFT regime.'

The correct answer is A and C. Law enforcement should determine who are the signatories on the account and examine the flow of money from the company to the individual in an effort to determine if it is legitimate. These steps would help to identify the source and destination of the funds, the purpose and nature of the transactions, and the possible involvement of money laundering or other financial crimes. Asking the bank for the history of the multi-level marketing company (B) may not be relevant or useful, as the company may have a legitimate business model or a false front. Examining possible Suspicious Activity Report information received from the local Financial Intelligence Units (D) may be helpful, but it is not a necessary step, as the bank may not have filed any reports or the reports may not contain sufficient information.

ACAMS CAMS Certification Video Training Course1, Module 4: Conducting or Supporting the Investigation Process, Lesson 1: Investigating Techniques for Law Enforcement

ACAMS CAMS Certification Study Guide2, Chapter 4: Conducting or Supporting the Investigation Process, Section 4.1: Investigating Techniques for Law Enforcement, pp. 125-126

The correct answer is B, because it describes a method of money laundering known asstructuringorsmurfing. This is when a customer or a group of customers break down large amounts of illicit funds into smaller transactions that are below the reporting threshold, and then send them to another customer or entity, often in another country. This way, they avoid triggering any suspicion or regulatory reporting by the bureau de change or money services business (MSB) that processes the wire transfers. Structuring or smurfing is a common technique used by money launderers to move funds across borders and disguise their origin and destination.

The other options are not necessarily indicative of money laundering, although they may require further investigation depending on the circumstances and the risk profile of the customers and countries involved. Option A describes a regular and small wire transfer that may be legitimate, such as a remittance to a family member or a friend. Option C describes a large volume of wire transfers that may be related to a seasonal or business activity, such as a holiday or a trade event. Option D describes a series of small wire transfers that may be coincidental or random, and do not necessarily add up to a significant amount.

ACAMS CAMS Certification Video Training Course - 6th Edition1

Exam CAMS: Certified Anti-Money Laundering Specialist (the 6th edition)2

ACAMS CAMS Study Guide - 6th Edition, Chapter 2, pages 36-37

: https://www.acams.org/wp-content/uploads/2019/09/ACAMS-CAMS-Study-Guide-6th-Edition-Chapter-2.pdf

The financial institution should perform further investigation to verify the legitimacy of the tour guide's explanation and the source of funds. If the investigation reveals any suspicious or unusual activity, such as inconsistent cash flow patterns, involvement of high-risk customers or jurisdictions, or indications of money laundering or terrorist financing, the financial institution should report the activity to the authorities and consider terminating the relationship. The financial institution should also document the investigation and its findings, and update the customer's risk profile accordingly. References: CAMS Study Guide - 6th Edition, Chapter 4, page 112 CAMS Certification Exam Outline, Domain 1, Task 1.2, Skill 1.2.2 ACAMS MoneyLaundering.com, Article: ''How to Conduct Effective Customer Due Diligence''