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. FATF Recommendation 7

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


2. 'Introducing Broker-Dealers in Commodities' (IB-C)

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


3. FATF Recommendation 1
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
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.
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


4. (Credit Card) Issuing Bank
The US State Dept issues the report annually.
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.
Solicits potential customers and issues the credit cards.


5. FATF Recommendation 28
Strengthen customer identification measures in iternational and domestic wire transfers.
Competent authorities should have powers of subpoena - search and seizure.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)


6. FATF Recommendation 14
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Expatriates sending money back to their home country or by other individuals sending money abroad.
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.


7. What normal business practise makes 'Product Division' possible?
Pouch activity.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
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.
Real Estate - Insurance Transactions - Trade-Based Money Laundering.


8. Who are the parties involved in a trust?
bear the mark 'APOSTILLE'
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
EurAsian Group
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).


9. The IMF estimates that laundered funds compromise ______ of the world's GDP
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
2% - 5% ($590B - $1.5T)
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).


10. What does a 'Commission Rogatoire' normally specify?
Letters Rogatory
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.
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.


11. 'Competent Authorities' refers to _____.
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.
A security that offers the owner the right to subscribe for ordinary shares of a company at a fixed date - usually at a fixed price. Equivalent to stock options.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.


12. The 'Art Loss Register'

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


13. Commodity Pool Operator
Report suspicious transactions linked to terrorism.
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
Foreign Corrupt Practices Act
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.


14. FATF Recommendation 40
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
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.


15. Who issues the Internationa Narcotics Control Strategy Report (INCSR) and how often?
Dealers in precious metals/stones - trust and company services providers - lawyers - notaries and accountants should all be required to report suspicious activity - but legal privilege cannot be violated.
Review customer files and conduct random sampling of accounts.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
The US State Dept issues the report annually.


16. FATF Recommendation 15
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.
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
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.


17. What is the Wolfsberg group?
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Issue and cancel securities certificates to reflect chagnes in ownership - act as an intermediary for the issuing company - and hanlde lost - stolen or destroyed certificates.
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.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.


18. FATF Recommendation 39
A security that offers the owner the right to subscribe for ordinary shares of a company at a fixed date - usually at a fixed price. Equivalent to stock options.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
Countries should recognize money laundering as an extraditable offense.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.


19. 'Coucil of Europe Convention on Laundering - Search - Seizure and Confiscation of the Proceeds from Crime' is known for what?
A US Federal Court
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
Refers to where the agent is acting under a contractual arrangement with the insurer to carry out its CDD functions (i.e. the agent is regarded as synonymous with the insurer) [FATF Risk-Based approach - Guidance for the Life Insurance Sector - Oct 0
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).


20. Who appoints a 'Federal Receiver' (US)?
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
Harmful or Preferrential Tax Regimes.
A US Federal Court
Countering the Financing of Terrorism (Counter Terrorist Financing).


21. Credit Card Associations
Applied by an authority - it is a special seal which certifies that a document is a true copy of an original. However - it does not and cannot speak to the validity of the document's content.
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.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.


22. What do boiler room salespeople typically sell?
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
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.
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
Penny Stocks


23. Dematerialization of Securities

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


24. OCC Office of the Comptroller of the Currency
Reliable - independent source of documents - data or information.
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 federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
An introducing broker-dealer with an exclusive written agreement with a Futures Commission Merchant (FCM) that obligates the FCM to assume responsibility for the introducing broker's performance.


25. Pink Sheets
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
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
Quite simply - a plan. While in the US - this term is often associated with a nefarious plan - it should NOT be assumed to be evil - especially as it may appear on the ACAMS exam.
An electronic quotation system that displays quotes of many securities traded over the counter.


26. Arrest Warrant
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.
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
Processes transactions for merchants who accept credit cards.
Money Laundering and Tax Evasion


27. What was the target of UN Security Council Resolution 1267?
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
Confiscation
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
2% - 5% ($590B - $1.5T)


28. FATF Recommendation 17
a Sr Management level
A person who tranfers stolen money (or merchandise) from one country to another - often as a result of online scams. Transfers - can be done electronically - via mail or courier service or in person.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
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.


29. SRO (Self-Regulatory Organizations)
Harmful or Preferrential Tax Regimes.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
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.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.


30. Commodity
The world's largest private DB of stolen art.
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
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.


31. FATF Recommendation 9
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.
Their financial institution may - wittingly or unwittingly - handle the proceeds of this crime while believing it is serving a legitimate client with major account balances.
Combines funds from various members and users them to trade in futures or options contracts.
Urge investors to buy 'house stocks' - stocks that the firm buys and sells as a market maker or has in its inventory. Oftentimes - they are running a 'pump-and-dumo' scheme.


32. The Palemo Convention
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
Issue and cancel securities certificates to reflect chagnes in ownership - act as an intermediary for the issuing company - and hanlde lost - stolen or destroyed certificates.
Often co-branded by financial institution; may have VISA or MasterCard logos; can be reloadable; usually can access ATMs for withdrawls globally; non-customers can buy them.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].


33. 'Commission Rogatoire' known in English as?
bear the mark 'APOSTILLE'
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
Letters Rogatory
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.


34. White-Collar crime

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


35. FATF Sepcial Recommendation on Terrorist Financing -- SR Seven
Strengthen customer identification measures in iternational and domestic wire transfers.
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
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
Real Estate - Insurance Transactions - Trade-Based Money Laundering.


36. What are some of the AML dangers of casino junkets?
Dealers in precious metals/stones - trust and company services providers - lawyers - notaries and accountants should all be required to report suspicious activity - but legal privilege cannot be violated.
Pouch activity.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
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.


37. FATF Sepcial Recommendation on Terrorist Financing -- SR Eight
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
Processes transactions for merchants who accept credit cards.
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.


38. CFT
Financial institutions should pay special attention to (and examine & document) complex - unusual large transactions - and all transactions which have no apparent economic or lawful purpose.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
have in place compulsory currency reporting requirements.
Countering the Financing of Terrorism (Counter Terrorist Financing).


39. What is the significance of 'Non-Financial Trades and Businesses' in realtion to Money Laundering?
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
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.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).


40. FATF Recommendation 10
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Countering the Financing of Terrorism (Counter Terrorist Financing).
Confiscation


41. Legal Arrangements (Insurance Industry)
Refers to express trusts or other similar legal arrangements - such as fiducie - treuhand and fideicomiso [FATF Risk-Based approach - Guidance for the Life Insurance Sector - Oct 09]
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
A fund setup by an investment trust that issues a fixed number of shares to its investors. As such - the market price of the shares fluctuates - often selling at a premium or discount to the fund's net asset value (NAV).
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.


42. Penny Stocks
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
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.
Securities with very low marker price - volume and/or liquidity that are traded on a securities exchange or on the OTC markets. They tend to be more volatile than those on the major exchanges.
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.


43. Boiler Room
Harmful or Preferrential Tax Regimes.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
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.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.


44. What is important about the US Money Laundering Control Act (MCLA)?
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
It was the first law in any country to make money laundering a crime.
Foreign Corrupt Practices Act
An account that does not show activity other than the posting of interest or account maintenance fees.


45. Should one ever file a Suspicious Transaction Report (STR/SAR) based on a person's profile?

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


46. FATF Recommendation 29
It conducts investigations in support of a government's confiscation or seizure efforts.
Money Laundering and Tax Evasion
that appear to be linked
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.


47. What do boiler room salespeople typically do?

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


48. Wholesale Banking
The International Monetary Fund (IMF) and the world bank conduct the joint program.
Banking services between merchant banks and other financial institutions.
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.


49. Many jurisdictions have legislation to ensure that suspects are not ____?
tipped off that they are being investigated.
Provide mutual legal assistance.
Confiscation
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.


50. FATF Sepcial Recommendation on Terrorist Financing -- SR One
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Take immediate steps to ratify and implement the UN instruments.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.
Person who - for compensation - provides advice on securities and investments and manages client assets.