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. FATF Recommendation 31
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.
The International Monetary Fund (IMF) and the world bank conduct the joint program.


2. Agent (Insurance Industry)
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
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
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.


3. FATF Recommendation 5
Person who - for compensation - provides advice on securities and investments and manages client assets.
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).
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.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.


4. What is the FCPA primarily known for?
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
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).
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.


5. FATF Recommendation 23
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
If provided for money laundering to be an internationally extraditable offense.
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.
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.


6. FATF Recommendation 22

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7. Investment Adviser
Person who - for compensation - provides advice on securities and investments and manages client assets.
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.
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.


8. Moneyval
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
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
disrupt or adversely afftect the business of the bank.


9. What does Financial Sector AssessmentProgram (FSAP) do?
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
High-speed matching of known or suspected patterns in very large DB's using recognition algorithms.
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.
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.


10. UK courts view on 'Suspicion'
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
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.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
Pouch activity.


11. What does an Extradition Treaty specify?
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
An account that does not show activity other than the posting of interest or account maintenance fees.
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.


12. What criterion does the US need to enforce its 'Extraterritorial Reach'?

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13. FATF Recommendations examples of non-financial businesses and professions
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.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
The International Monetary Fund (IMF) and the world bank conduct the joint program.


14. 'Commission Rogatoire' known in English as?
Harmful or Preferrential Tax Regimes.
Letters Rogatory
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.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.


15. Affidavit
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
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.
Take immediate steps to ratify and implement the UN instruments.
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.


16. FATF Sepcial Recommendation on Terrorist Financing -- SR Two
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
A market is which securities are bought and sold outside of establisehd securities markets.
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 detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.


17. What are the two types of Stored Value Cards?
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
Open and Closed system
foreign correspondent banks
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).


18. (Credit Card) Third-Party processor
The International Monetary Fund (IMF) and the world bank conduct the joint program.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.


19. What do boiler room salespeople typically sell?
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Penny Stocks
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
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.


20. Options/Options Contract
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.
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.
Processes transactions for merchants who accept credit cards.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.


21. Scheme
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
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.
Foreign Corrupt Practices Act


22. USA Patriot Act Section 312 'Offshore Bank'
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.
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data


23. What were recently identified as Emerging Money Laundering risks?
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
Funds transfers - Shell Corporations - Contractual Transactions.
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.
Penny Stocks


24. Fraud
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.


25. Who issues the Internationa Narcotics Control Strategy Report (INCSR) and how often?
The US State Dept issues the report annually.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
a Sr Management level


26. FATF Recommendation 28
The International Monetary Fund (IMF) and the world bank conduct the joint program.
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).
Competent authorities should have powers of subpoena - search and seizure.
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.


27. Respondent Bank

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28. Distribution Channels (Insurance Industry)
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
tipped off that they are being investigated.
Intergovernmental Action Group against Money Laundering in Africa
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]


29. FATF Recommendation 16
An account that does not show activity other than the posting of interest or account maintenance fees.
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.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.


30. 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.
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.


31. In what country is the Egmont Group Secretariat now located?
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.
Canada
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.


32. How is 'Identity theft' often accomplished?
As a financial institution service that is very vulnerable to money laundering.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.


33. A 'panzi' scheme is named for whom?
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
Person who - for compensation - provides advice on securities and investments and manages client assets.
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.


34. Apostille

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35. FATF Recommendation 14
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
An electronic quotation system that displays quotes of many securities traded over the counter.


36. 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.
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.
a chain-referral scheme.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.


37. Portfolio Manager
disrupt or adversely afftect the business of the bank.
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.
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.
Processes transactions for merchants who accept credit cards.


38. Retail Banking
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
Typical mass-market banking where individual customers use local branches of larger commercial banks.
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.
Freeze and confiscate terrorist assets.


39. 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 grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.


40. MENAFATF
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
Middle East and North Africa Financial Action Task Force
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
a Sr Management level


41. Wire Transfers
The FIU of the UK
The opposing part of a transaction or trade.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
a chain-referral scheme.


42. How does 'Product Diversion' work?
Financial Action Task Force
Product is purchsed with terms that it is going to foreign country A. While in transit - the product is diverted back to originating country or to another foreign market where the greatly discounted price provides for extreme profits.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.


43. What is one of the Financial Service Authority's (UK) tasks?
An account that does not show activity other than the posting of interest or account maintenance fees.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Report suspicious transactions linked to terrorism.
To reduce financial crime - including money laundering and terrorit financing.


44. Variable Annuity
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
Contract issued by an insurance company under which an investor provides the insurer with funds (a lump-sum or series of payments). The insurer then agrees to make periodic payments to the investor starting the immediately or in the future.
Real Estate - Insurance Transactions - Trade-Based Money Laundering.
Placement - Layering - Integration.


45. FATF's designated transactional threshold for Financial Insitutions is _____.
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.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
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)


46. EAG
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.
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
EurAsian Group
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.


47. Investigative Log
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Stored Value Cards - Mobile Payments - Internet Payments.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.


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

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49. FATF Recommendation 20
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws


50. What was the target of UN Security Council Resolution 1267?
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
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.