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 does theInternationa Narcotics Control Strategy Report (INCSR) entail?
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
A US Federal Court


2. The Palemo Convention
Harmful or Preferrential Tax Regimes.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
People who help move the billions of dollars drug traffickers earn around the world.
Banking services between merchant banks and other financial institutions.


3. What is important about the US Money Laundering Control Act (MCLA)?
It was the first law in any country to make money laundering a crime.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
foreign correspondent banks
The sale of a stock that the investor does not own. To do so - a securities intermediary 'loans' the stock to the investor - which comes from the intermediary's own inventory - another client's margin account or another intermediary.


4. How do 'Hedge Funds' operate?

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5. Basel committee's 'Customer Due Diligence for Banks' when verifying a unit's compliance with KYC policies and procedures - the home country supervisors or auditors should do what?
Review customer files and conduct random sampling of accounts.
The process of agreeing to purchase a new issue of securities from an issuer and distribute it to investors. The underwriter makes a profit between the price paid to the issuer and the public offering price.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
Report suspicious transactions linked to terrorism.


6. Bust-out
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
a Sr Management level
The UN Convention against Transnational Organized Crime [Adopted 12/2000].


7. 'Loan Back' method. Give example of how it works.

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8. Commodity
Financial Action Task Force on Money Laundering in South America
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.


9. Convertible Bond
Corporate bond that includes an option for the holder to convert it into other securities after a specified period at the discretion of the bondholder.
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
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
Pouch activity.


10. What do boiler room salespeople typically do?

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11. Nostro

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12. FATF Sepcial Recommendation on Terrorist Financing -- SR Eight
If provided for money laundering to be an internationally extraditable offense.
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).
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
Expatriates sending money back to their home country or by other individuals sending money abroad.


13. How does the Egmont group help its members?
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
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.
A market is which securities are bought and sold outside of establisehd securities markets.
Market participants intentionally restrict a security's liquidity. May lead to increased profits when the security's price rises due to the lack of 'supply'.


14. Vital Service Providers (VSPs)
Foreign Corrupt Practices Act
People who help move the billions of dollars drug traffickers earn around the world.
Provide mutual legal assistance.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).


15. When was the Offshore Group of Banking Supervisors established? What was the impetus behind its establishment?
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.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
The world's largest private DB of stolen art.
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.


16. A public perception that a bank is not able to manage its operational risk effectively can...
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.
A bank whose license has conditions that prohibhit the licensed entity from conducting banking activities with the citizens - or with the local currency - of the country that issued that license.
Use of electronic clearing houses to facilitate electronic transfers of money that complete transactions between two parties where the buyer receives securities - goods - services etc. in exchange for the money.
disrupt or adversely afftect the business of the bank.


17. Dematerialization of Securities

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18. As considered by UN and OECD - these are jurisdictions that have no or low tax rates - and do not attract real business or foreign investment
Harmful or Preferrential Tax Regimes.
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.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)


19. (Credit Card) Third-Party processor
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.
Harmful or Preferrential Tax Regimes.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.


20. Commodity Trading Advisor
Direct or indirect advisor on buying and selling futures or commodity options.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
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.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.


21. FATF Recommendation 22

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22. Who conducts the Financial Sector Assessment Program (FSAP)?
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
Banking services between merchant banks and other financial institutions.
To promote the effective supervision of banks in their jurisdictions; to further international cooperation in the supervision between the Offshore Banking Supervisors - and with Basel committee member nations and other banking supervisors.
The International Monetary Fund (IMF) and the world bank conduct the joint program.


23. Who appear to be predominant users of hawalas and other alternative remittance systems?
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
Penny Stocks
Expatriates sending money back to their home country or by other individuals sending money abroad.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.


24. FATF Recommendation 38
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.
Take expeditious action to requests by foreign countries to identify - freeze - seize and confiscate property that is proceeds of money laundering or a predicate crime.
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.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.


25. FATF Recommendation 24
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Stored Value Cards - Mobile Payments - Internet Payments.
The FIU of the UK
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.


26. FATF Recommendation 35
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.


27. Margin
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.
Canada
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.


28. The Joint Money Laundering Steering Group (UK) has published a series of AML Guidance Notes for different sectors of the financial community. But - As a group of trade associations - it has...
The world's largest private DB of stolen art.
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
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.
no regulatory power or function


29. Moneyval
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
www.artloss.com
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism


30. What does FIU do?
It was the first law in any country to make money laundering a crime.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
Corporate bond that includes an option for the holder to convert it into other securities after a specified period at the discretion of the bondholder.


31. Three stages of money laundering
Placement - Layering - Integration.
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
bear the mark 'APOSTILLE'


32. How are 'Predicate Crimes' sometimes identified?

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33. Affidavit
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
that appear to be linked
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.
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.


34. FATF Recommendation 3
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
Financial Action Task Force on Money Laundering in South America
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]


35. 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]
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
Canada
Solicits potential customers and issues the credit cards.


36. How is 'Identity theft' often accomplished?
The US State Dept issues the report annually.
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.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.


37. FATF
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
It was the first law in any country to make money laundering a crime.
Financial Action Task Force
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.


38. Account Monitoring Order (UK and several other countries)
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
Funds transfers - Shell Corporations - Contractual Transactions.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
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.


39. Examples of White-collar crime
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.


40. OTC markets Over-The-Counter
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.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
A market is which securities are bought and sold outside of establisehd securities markets.
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.


41. What was the effect of the 1988 Vienna Convention as it relates to extradtition?
Take expeditious action to requests by foreign countries to identify - freeze - seize and confiscate property that is proceeds of money laundering or a predicate crime.
Expatriates sending money back to their home country or by other individuals sending money abroad.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
If provided for money laundering to be an internationally extraditable offense.


42. Boiler Room
The FIU of Russia
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
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.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.


43. GAFISUD
Financial Action Task Force on Money Laundering in South America
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
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.
that appear to be linked


44. Why does a launderer try to run transactions through a concentration account of a financial institution?
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.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.


45. In Emerging Money Laundering Risks - what 3 methods are identified as 'Funds Transfers'?
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.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
Stored Value Cards - Mobile Payments - Internet Payments.
www.artloss.com


46. In what country is the Egmont Group Secretariat now located?
Canada
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.
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.
An electronic quotation system that displays quotes of many securities traded over the counter.


47. FATF Recommendation 18
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
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.
The possibility that lawsuits adverse judgements or contracts that turn out to be unenforceable can disrupt or adversely affect the operatinos or condition of a financial siutation.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.


48. FATF Recommendation 19
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
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.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.


49. EAG
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
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.
EurAsian Group
Strengthen customer identification measures in iternational and domestic wire transfers.


50. 'Kiting' via credit card
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.
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
Take expeditious action to requests by foreign countries to identify - freeze - seize and confiscate property that is proceeds of money laundering or a predicate crime.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.