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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
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.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
People who help move the billions of dollars drug traffickers earn around the world.
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.

2. GAFISUD
Stored Value Cards - Mobile Payments - Internet Payments.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
Financial Action Task Force on Money Laundering in South America

3. Portfolio Manager
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.
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.
Person who - for compensation - provides advice on securities and investments and manages client assets.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.

4. What is the significance of 'Non-Financial Trades and Businesses' in realtion to Money Laundering?
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
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.
Penny Stocks
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).

5. Guaranteed Introducing Broker

6. Short Sale

7. The 'Art Loss Register'

8. Respondent Bank

9. FATF Recommendation 24
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
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.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.

10. Account Monitoring Order (UK and several other countries)
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
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.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
The world's largest private DB of stolen art.

11. Commodity
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
An electronic quotation system that displays quotes of many securities traded over the counter.
Expatriates sending money back to their home country or by other individuals sending money abroad.
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'

12. FATF Recommendation 34
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
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.
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.

13. FATF Recommendation 33
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
Firm or person that solicits and accepts commodity futures orders from customers but does not accept funds. Two types of IB_C's: Guaranteed and Independent.
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.

14. FATF Recommendation 10
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
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.
Money Laundering and Tax Evasion
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.

15. Credit Card Associations
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].

16. Underwriting
Money Laundering and Tax Evasion
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
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.
Funds transfers - Shell Corporations - Contractual Transactions.

17. FATF Recommendation 3
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
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.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
Strengthen customer identification measures in iternational and domestic wire transfers.

18. How is 'Identity theft' often accomplished?
As 'felonies' or 'all offenses in the criminal code'.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
To reduce financial crime - including money laundering and terrorit financing.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.

19. Reverse Flip

20. How do most governments view Private Banking?
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.
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.
a Sr Management level
As a financial institution service that is very vulnerable to money laundering.

21. Money Mules
Letters Rogatory
They can accrue value as the price of the underlying stock rises.
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.
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.

22. FATF Recommendation 35
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
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.

23. FATF Recommendation 5
To reduce financial crime - including money laundering and terrorit financing.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].

24. What is private investment company also known as?
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.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
a chain-referral scheme.
Pouch activity.

25. What is the primary use of a 'Mutual Legal Assistance Treaty'?
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
Intergovernmental Action Group against Money Laundering in Africa
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
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.

26. What the primary objectives of Offshore Group of Banking Supervisors?
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.
a chain-referral scheme.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.

27. FATF Recommendation 39
Countries should recognize money laundering as an extraditable offense.
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
Review customer files and conduct random sampling of accounts.
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'.

28. Commodity Pool
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
High-speed matching of known or suspected patterns in very large DB's using recognition algorithms.
Combines funds from various members and users them to trade in futures or options contracts.
Impose AML requirements on alternative remittance systems.

29. What does FIU do beyond what FIU does?

30. 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.
2% - 5% ($590B - $1.5T)
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.
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

31. 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...
Processes transactions for merchants who accept credit cards.
Stored Value Cards - Mobile Payments - Internet Payments.
that appear to be linked
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.

32. Retail Banking
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
Typical mass-market banking where individual customers use local branches of larger commercial banks.

33. FATF Recommendation 12
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
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.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism

34. FATF Recommendation 17
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
The US State Dept issues the report annually.
Financial Action Task Force on Money Laundering in South America

35. What is the aim of Joint Money Laundering Steering Group? (UK)
The opposing part of a transaction or trade.
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.
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.

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

37. What is one of the cental stragetic tools required for effective action against money laundering?
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.
Confiscation
no regulatory power or function

38. Distribution Channels (Insurance Industry)
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]
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.
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Expatriates sending money back to their home country or by other individuals sending money abroad.

39. FATF Sepcial Recommendation on Terrorist Financing -- SR Three
The International Monetary Fund (IMF) and the world bank conduct the joint program.
Freeze and confiscate terrorist assets.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
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.

40. A public perception that a bank is not able to manage its operational risk effectively can...
No.
disrupt or adversely afftect the business of the bank.
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.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.

41. 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.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)

42. Nostro

43. What is the goal of FSAP?
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
a Sr Management level
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.

44. Common types of 'Derivatives'
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
Harmful or Preferrential Tax Regimes.
www.artloss.com
Futures contracts - forwards - swaps or options.

45. What are the two types of Stored Value Cards?
Open and Closed system
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Funds transfers - Shell Corporations - Contractual Transactions.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.

46. What was the effect of the 1988 Vienna Convention as it relates to extradtition?
Strengthen customer identification measures in iternational and domestic wire transfers.
If provided for money laundering to be an internationally extraditable offense.
As 'felonies' or 'all offenses in the criminal code'.
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.

47. Boiler Room
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 knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
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).

48. Abusive Squeezes

49. FATF Sepcial Recommendation on Terrorist Financing -- SR Seven
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Strengthen customer identification measures in iternational and domestic wire transfers.
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.

50. Investigative Log
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.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.