Certified Anti Money Laundering Specialist Cams

Instructions:

• Answer 50 questions in 15 minutes.
• If you are not ready to take this test, you can study here.
• Match each statement with the correct term.
• Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. What is important about the US Money Laundering Control Act (MCLA)?
bear the mark 'APOSTILLE'
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
It was the first law in any country to make money laundering a crime.


2. What is a Financial Intelligence Unit?
As a key tool in detecting suspicious or money laundering activity - it is important because correspondent accounts are often used as conduits to launder criminal proceeds in international settings.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Solicits potential customers and issues the credit cards.
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.


3. 'Kiting' via credit card
The FIU of the UK
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
The nature of the request - the relevant criminal charges in the requesting country - the legal provision under which the request is made - and the information that is sought.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.


4. Credit Card Associations
Expanding/Systemising the exchange of financial intelligence - improving expertise/capabilities of their personnel - fostering better communication by applying new technologies and sharing financial crimes investigations information.
Funds transfers - Shell Corporations - Contractual Transactions.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.


5. 'Competent Authorities' refers to _____.
no regulatory power or function
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.


6. FATF Recommendation 5
They can accrue value as the price of the underlying stock rises.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.


7. Why does a launderer try to run transactions through a concentration account of a financial institution?
Financial institutions should have adequate supervision and regulation. Ensure no criminal element in position on control. Money transfer/exchangers should be registered and subjected to monitoring.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.


8. 'Closed-end Mutual Fund' (Or Comany)

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9. What does theInternationa Narcotics Control Strategy Report (INCSR) entail?
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
Harmful or Preferrential Tax Regimes.
To reduce financial crime - including money laundering and terrorit financing.
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.


10. FATF Recommendation 27
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
Passed in 1977 - the US law is primarily known for its anti-bribery provisions (it also applies to foreign companies with stocks covered by the Securities and Exchange Act of 1934).


11. What is meant by 'Know Your Customer's customer'?
Penny Stocks
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
A co-operative property seller agrees to sell home at a well-below market reported price - then accepts the difference 'under the table'. When launderer later sells house - he recognizes 'gain' and all funds appear legitimate as it sold at market.
The FIU of Russia


12. FATF Recommendation 32
The US State Dept issues the report annually.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
It was the first law in any country to make money laundering a crime.


13. US law prohibhits Foriegn Shell Banks from ____?
bear the mark 'APOSTILLE'
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
The world's largest private DB of stolen art.


14. FATF Recommendations examples of non-financial businesses and professions
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
bear the mark 'APOSTILLE'
Court order directing a law enforcement officer to seize and detain a particular person and require them to provide an answer to a compliant or otherqise appear in court.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.


15. The USA Patriot Act enacted a number of statutory provisions that bear directly on the procedures US financial institutions must follow in connection with their...
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Financial institutions may rely upon intermediaries to perform certain CDD elements provided the intermediary is supervised and regulated. However - ultimate responsibility remains with the financial institution.
foreign correspondent banks
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.


16. Foriegn Shell Banks are vehicles for ______ & ______?
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
Money Laundering and Tax Evasion
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.


17. What does the principal US money laundering law look for before implementing its 'Extraterritorial Reach'?
Transportation/transfer of funds (even clean) to/from the US - if done to promote unlawful activity - or with knowledge that the funds are illicit - or to conceal/disguise the nature - location - source - ownership - etc. of funds - or to avoid feder
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Represents a profession and is made up of member professionals; has a role in regulating the persons who are qualified to enter and who practise the profession; performs cetain supervisory or monitoring type function.
It one wants to open a bank account overseas - but do it through the mail - the bank may need to be assured that the copy of the passport is correct. The Apostille mark can assure this.


18. Transparency International
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
bear the mark 'APOSTILLE'
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.


19. FATF
Financial Action Task Force
Court order directing a law enforcement officer to seize and detain a particular person and require them to provide an answer to a compliant or otherqise appear in court.
Harmful or Preferrential Tax Regimes.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.


20. What is private investment company also known as?
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Funds transfers - Shell Corporations - Contractual Transactions.
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
While it is normally known as a Personal Investment Company (PIC) - in some jurisdictions - the international business company or exempt company is also the same.


21. FATF Sepcial Recommendation on Terrorist Financing -- SR Nine
that appear to be linked
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
Transportation/transfer of funds (even clean) to/from the US - if done to promote unlawful activity - or with knowledge that the funds are illicit - or to conceal/disguise the nature - location - source - ownership - etc. of funds - or to avoid feder
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].


22. What is the primary use of a 'Mutual Legal Assistance Treaty'?
They pool investors' money and invest those funds in financial instruments in an effort to turn a profit. They typically issue securities in 'private offerings' that are usually not required to be registered with sa securities or financial regulator.
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.


23. What are included in the Wolfsberg AML Principles on Private Banking?
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.


24. FATF Recommendation 18
Countries should not allow shell banks. Financial institutions should not have correspondent banking relationships with shell banks or banks that allow shell banks to do business through their accounts.
Placement - Layering - Integration.
Combines funds from various members and users them to trade in futures or options contracts.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.


25. How are 'Predicate Crimes' sometimes identified?

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26. Where is the Art Loss Register found?
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
www.artloss.com
A record that financial institutions must retain for each cash sale of bank checks - drafts - money orders - cashier's checks and traveller's checks between $3 -000 and $10 -000.
No.


27. Abusive Squeezes

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28. What is a 'NCCT'?
High-speed matching of known or suspected patterns in very large DB's using recognition algorithms.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.


29. FATF Sepcial Recommendation on Terrorist Financing -- SR Three
Freeze and confiscate terrorist assets.
Stored Value Cards - Mobile Payments - Internet Payments.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.


30. FATF Recommendation 10
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.


31. FATF Sepcial Recommendation on Terrorist Financing -- SR Six
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).
Impose AML requirements on alternative remittance systems.


32. Free Look Period
A contractual arrangement whereby the trustee manages the property for the benefit of the beneficiary in accordance with the contractual terms set by the grantor.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
A professional responsible for the securities portfolio of an individual or institutional investor. In return for a fee - the manager has the responsibility of choosing and managing assets.


33. FATF Recommendation 3
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
Direct money of Criminal A is sent to foreign bank account of company B. Investment company C is formed as A's country. A is appointed as director of C. C borrows money from B and buys building which is rented to 3rd parties. with rent - C pays off B


34. Account Monitoring Order (UK and several other countries)
The FIU of the UK
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Competent authorities should have powers of subpoena - search and seizure.
A degree of satisfaction not necessarily amounting to belief but extending beyond specualtionas to whether an event has occured or not. Though suspicion requires a lesser factual basis than a belief - it must be built upon some foundation.


35. FATF Recommendation 26
Competent authorities should have powers of subpoena - search and seizure.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
Refers to dishonest broker-dealers who set up a group of high pressure salespeople who use banks of telephones to make cold calls to as many potential investors as possible.


36. Market Manipulation
A contractual arrangement whereby the trustee manages the property for the benefit of the beneficiary in accordance with the contractual terms set by the grantor.
A deliberate attempt to interfere with the free and fair operation of the market and create artificial - false or misleading appearances with respect to the price of - or market for a security - commodity or currency.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
A Correspondent Banking Client who receives Corresponding Banking services from an institution and itself provides Correspondent Banking services to other financial institutions in the same currency as the account it maintains with the institution.


37. A notary can issue a Apostille but it must be in a country that signed The Hague Convention (1961) and it must ___________. If the notary doesn't understand - find another one.

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38. What is a 'Trust'?
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
Procedures used to determine the beneficial owners of a correspondent bank and the type of activity that wil be 'normal and expected' for the bank.
A contractual arrangement whereby the trustee manages the property for the benefit of the beneficiary in accordance with the contractual terms set by the grantor.


39. A 'panzi' scheme is named for whom?
Intergovernmental Action Group against Money Laundering in Africa
Charles Ponzi - an Italian immigrant to the US who spent 10 years in jail for a scheme that defrauded 40 -000 people out of $15 million.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
The US State Dept issues the report annually.


40. FATF Recommendation 33
The International Monetary Fund (IMF) and the world bank conduct the joint program.
a chain-referral scheme.
A contractual arrangement whereby the trustee manages the property for the benefit of the beneficiary in accordance with the contractual terms set by the grantor.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.


41. Examples of VSP's
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.


42. Affidavit
A written statement given under oath before an officer of the court - notary public - or other authorized person. Commonly used as the factual basis for an application for a search - arrest or seizure warrant.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
The right - but not the obligation - to buy or sell a set amount of something - such as a share or commodity - at a set price after a set expiration date.
To provide a forum for FIU's (Financial Intelligence Unit) to improve support to their respective national AML progrmans and development protocols for the sharing of information.


43. What were recently identified as Emerging Money Laundering risks?
Financial Action Task Force on Money Laundering in South America
A contractual arrangement whereby the trustee manages the property for the benefit of the beneficiary in accordance with the contractual terms set by the grantor.
Funds transfers - Shell Corporations - Contractual Transactions.
have in place compulsory currency reporting requirements.


44. Boiler Room
A written statement given under oath before an officer of the court - notary public - or other authorized person. Commonly used as the factual basis for an application for a search - arrest or seizure warrant.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
FATF principles should apply to all branches and subsidiaries of a financial institution - even those abroad. Inability to do should re reported to parent institution's regulatory/supervisory authority.
Refers to dishonest broker-dealers who set up a group of high pressure salespeople who use banks of telephones to make cold calls to as many potential investors as possible.


45. What is one of the Financial Service Authority's (UK) tasks?
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
To reduce financial crime - including money laundering and terrorit financing.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.


46. Who appoints a 'Federal Receiver' (US)?
As a financial institution service that is very vulnerable to money laundering.
Futures contracts - forwards - swaps or options.
www.artloss.com
A US Federal Court


47. Nostro

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48. FATF Recommendation 19
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.
www.artloss.com
Direct money of Criminal A is sent to foreign bank account of company B. Investment company C is formed as A's country. A is appointed as director of C. C borrows money from B and buys building which is rented to 3rd parties. with rent - C pays off B
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.


49. Why is 'Know Your Customer's Customer' important?
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
Provide mutual legal assistance.
A US Federal Court
Respondent banks may be used by other banks and customers to conduct transactions through a correspondent account.


50. What are some of the AML dangers of casino junkets?
If one needs to transport currency across borders - one needs to have the smallest package possible to avoid detection.
May involve movement or large sums of money going cross-border and often through multiple casinos - all by a third party (the operator). Sometime operator does not identify funds owners.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.