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. Under the US Bank Secrecy Act - SAR filings are confidential and the institutions employees cannot ____?

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


2. How does the Egmont group help its members?
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.
Report suspicious transactions linked to terrorism.
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
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.


3. Open System Stored Value Card
The opposing part of a transaction or trade.
bear the mark 'APOSTILLE'
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.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.


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

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


5. FATF Recommendation 28
A fund setup by an investment trust in which the number of shares can fluctuate as investors' move in and out the fund. Share prices moves in direct proportion of the net asset value of the underlying investments (no premium or discount).
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
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.
Competent authorities should have powers of subpoena - search and seizure.


6. FATF Recommendation 27
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
They can accrue value as the price of the underlying stock rises.


7. FATF Recommendation 13
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.


8. Counter Party
The opposing part of a transaction or trade.
It conducts investigations in support of a government's confiscation or seizure efforts.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
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.


9. FATF Recommendation 29
Money Laundering and Tax Evasion
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
The FIU of the UK
The means through which the insurance products and services are provided to a customer [FATF Risk-Based approach - Guidance for the Life Insurance Sector - Oct 09]


10. Express Trust
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.


11. MENAFATF
Take immediate steps to ratify and implement the UN instruments.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
Middle East and North Africa Financial Action Task Force


12. 'Commission Rogatoire' known in English as?
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.
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.
have in place compulsory currency reporting requirements.
Letters Rogatory


13. Cash Log

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


14. A 'Cash Letter' can also be referred to as _____.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.
The FIU of the UK
Pouch activity.


15. Transparency International
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
Banking services between merchant banks and other financial institutions.
Review customer files and conduct random sampling of 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.


16. (Credit card) Acquiring Bank
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
Canada
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
Processes transactions for merchants who accept credit cards.


17. What was the target of UN Security Council Resolution 1267?
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
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.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.


18. Characteristics of an 'Open System Stored Value Card'
The International Monetary Fund (IMF) and the world bank conduct the joint program.
Type of foreign bank that is incorporated in the host country but is considered to be owned by a foreign parent bank. It only needs to operarted under the host country's regulations.
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.
Countries should recognize money laundering as an extraditable offense.


19. Many jurisdictions have legislation to ensure that suspects are not ____?
tipped off that they are being investigated.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
a chain-referral scheme.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.


20. Examples of White-collar crime
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
2% - 5% ($590B - $1.5T)
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
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.


21. FATF Recommendation 36
Provide mutual legal assistance.
Freeze and confiscate terrorist assets.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.


22. Pink Sheets
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
An electronic quotation system that displays quotes of many securities traded over the counter.
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.


23. EAG
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.
EurAsian Group
disrupt or adversely afftect the business of the bank.
a chain-referral scheme.


24. What is the goal of FSAP?
Money Laundering and Tax Evasion
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
Middle East and North Africa Financial Action Task Force
Placement - Layering - Integration.


25. FATF Recommendation 34
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
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.
High-speed matching of known or suspected patterns in very large DB's using recognition algorithms.


26. Examples of VSP's
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
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.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.


27. FATF Sepcial Recommendation on Terrorist Financing -- SR Eight
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
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.
Confiscation
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.


28. Commodity
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
Intergovernmental Action Group against Money Laundering in Africa
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
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.


29. US law prohibhits Foriegn Shell Banks from ____?
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
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.


30. What are the two types of Stored Value Cards?
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Open and Closed system
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.


31. 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.

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


32. (Credit Card) Issuing Bank
The world's largest private DB of stolen art.
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.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Solicits potential customers and issues the credit cards.


33. Commodity Trading Advisor
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
Direct or indirect advisor on buying and selling futures or commodity options.
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.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].


34. Corporate Bank

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


35. Why is it imperative to have a strong Know Your Employee program?
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
Penny Stocks
Absolutely NOT. If the decision is based purely on profile - then you are discriminating. you need to file such reports on the ACTIVITY especially if it differs from the 'normal and expected' as reflected in the customer profile.
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.


36. White-Collar crime

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


37. In general terms - EDD requires what of a financial institution?

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


38. (Credit Card) Third-Party processor
A bank which uses the services of another bank - such as check clearing - wire transfers - etc. The bank providing the service is the 'Correspondent Bank'
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
Strengthen customer identification measures in iternational and domestic wire transfers.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.


39. What is the Serious Organised Crime Agency (SOCA)?
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Open and Closed system
Real Estate - Insurance Transactions - Trade-Based Money Laundering.
The FIU of the UK


40. Investment Adviser
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
Solicits potential customers and issues the credit cards.
Person who - for compensation - provides advice on securities and investments and manages client assets.
disrupt or adversely afftect the business of the bank.


41. FATF Recommendation 10
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
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.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.


42. What is meant by 'Know Your Correspondent Bank'?

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


43. Cash Equivalent

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


44. Convertible Preferred
Account established by a domestic banking institution to receive deposits from - make payments on behalf of - or handle other financial transactions for a foreign financial institution - usually in the foreign financial institutions's cureency.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.


45. Futures Commission Merchant (FCM)
It was the first law in any country to make money laundering a crime.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
High-speed matching of known or suspected patterns in very large DB's using recognition algorithms.


46. FATF Sepcial Recommendation on Terrorist Financing -- SR Three
Freeze and confiscate terrorist assets.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.


47. Who appear to be predominant users of hawalas and other alternative remittance systems?
Financial Action Task Force on Money Laundering in South America
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
Expatriates sending money back to their home country or by other individuals sending money abroad.


48. What does the principal US money laundering law look for before implementing its 'Extraterritorial Reach'?
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.
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
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.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.


49. According to FATF - financial transactions above a designated threshold may include situations where the transaction takes place in a single operation or in several operations...
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.
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
that appear to be linked
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.


50. What does the 'SEC' (US Securities and Exchange Commission) do?
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.