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 was the effect of the 1988 Vienna Convention as it relates to extradtition?
If provided for money laundering to be an internationally extraditable offense.
Person who - for compensation - provides advice on securities and investments and manages client assets.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.


2. Transparency International
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
Countering the Financing of Terrorism (Counter Terrorist Financing).
The International Monetary Fund (IMF) and the world bank conduct the joint program.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.


3. Automated Sale
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
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.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
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.


4. Nostro

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5. What is the primary use of a 'Mutual Legal Assistance Treaty'?
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
Strengthen customer identification measures in iternational and domestic wire transfers.
If provided for money laundering to be an internationally extraditable offense.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.


6. Why is understanding 'Product Diversion' important to the AML investigator?
Solicits potential customers and issues the credit cards.
Confiscation
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
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.


7. Money Mules
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Foreign Corrupt Practices Act
Canada
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.


8. FATF Sepcial Recommendation on Terrorist Financing -- SR Two
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
Urge investors to buy 'house stocks' - stocks that the firm buys and sells as a market maker or has in its inventory. Oftentimes - they are running a 'pump-and-dumo' scheme.
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]
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.


9. Futures Commission Merchant (FCM)
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
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.
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
Stored Value Cards - Mobile Payments - Internet Payments.


10. 'Competent Authorities' refers to _____.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
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]
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
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.


11. FATF Recommendation 27
Solicits potential customers and issues the credit cards.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.


12. What is one of the cental stragetic tools required for effective action against money laundering?
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
a Sr Management level
Confiscation
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.


13. FCPA (US)
Foreign Corrupt Practices Act
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
Middle East and North Africa Financial Action Task Force
Harmful or Preferrential Tax Regimes.


14. Retail Banking
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.
Typical mass-market banking where individual customers use local branches of larger commercial banks.
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


15. Moneyval
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
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
Countries should recognize money laundering as an extraditable offense.
Freeze and confiscate terrorist assets.


16. How does the Egmont group help its members?
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.
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.
Banking services between merchant banks and other financial institutions.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.


17. EAG
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
EurAsian Group
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.


18. Abusive Squeezes

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19. In Emerging Money Laundering Risks - what 3 areas are associated with 'Contractual Transactions'?
Real Estate - Insurance Transactions - Trade-Based Money Laundering.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.


20. FATF Recommendation 40
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
Foreign Corrupt Practices Act
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
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.


21. Agent (Insurance Industry)
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
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
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.


22. Distribution Channels (Insurance Industry)
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
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.
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]
They can accrue value as the price of the underlying stock rises.


23. FATF Recommendation 7

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24. What is the Serious Organised Crime Agency (SOCA)?
Letters Rogatory
The FIU of the UK
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.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.


25. FATF Recommendation 37
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.
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
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.


26. The IMF estimates that laundered funds compromise ______ of the world's GDP
2% - 5% ($590B - $1.5T)
a chain-referral scheme.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.


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

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28. When is a jurisdiction considered to be 'ring-fenced'?
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
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.
An electronic quotation system that displays quotes of many securities traded over the counter.


29. FATF Recommendation 31
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
They can accrue value as the price of the underlying stock rises.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.


30. What does a 'Commission Rogatoire' normally specify?
It conducts investigations in support of a government's confiscation or seizure efforts.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
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.


31. May a shell bank maintain a correspondent account with a US bank?
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Financial Action Task Force
Confiscation
No.


32. FATF Recommendation 2
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
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.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.


33. Downstream Correspondent Clearer
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.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
Money Laundering and Tax Evasion
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.


34. FATF Sepcial Recommendation on Terrorist Financing -- SR Nine
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).
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
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.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.


35. SRO (Self-Regulatory Organizations)
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
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.
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.


36. What is a 'Trust'?
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.
The US State Dept issues the report annually.
Direct or indirect advisor on buying and selling futures or commodity options.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.


37. FATF Recommendation 3
no regulatory power or function
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.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
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.


38. MENAFATF
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Futures contracts - forwards - swaps or options.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Middle East and North Africa Financial Action Task Force


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

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40. 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.
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.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
The FIU of Russia


41. Why do companies export their goods at prices far below those in their home country?
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.


42. Structuring is a common technique in jurisdictions that...
have in place compulsory currency reporting requirements.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
Review customer files and conduct random sampling of accounts.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].


43. Counter Party
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.
The opposing part of a transaction or trade.
a Sr Management level
The world's largest private DB of stolen art.


44. What does the 'SEC' (US Securities and Exchange Commission) do?
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.


45. Market Manipulation
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
A US Federal Court
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]
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.


46. 'Coucil of Europe Convention on Laundering - Search - Seizure and Confiscation of the Proceeds from Crime' is known for what?
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
2% - 5% ($590B - $1.5T)
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.


47. What does an Extradition Treaty specify?
Expatriates sending money back to their home country or by other individuals sending money abroad.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.
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.
Countries should recognize money laundering as an extraditable offense.


48. What is the Wolfsberg group?
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
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


49. FATF Recommendation 20
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
tipped off that they are being investigated.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.


50. Apostille

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