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 18
May involve movement or large sums of money going cross-border and often through multiple casinos - all by a third party (the operator). Sometime operator does not identify funds owners.
Countries should not allow shell banks. Financial institutions should not have correspondent banking relationships with shell banks or banks that allow shell banks to do business through their accounts.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
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.


2. Investigative Log
Impose AML requirements on alternative remittance systems.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.


3. Legal Arrangements (Insurance Industry)
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
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]


4. FATF Recommendation 4
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.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
Harmful or Preferrential Tax Regimes.


5. Margin
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
Middle East and North Africa Financial Action Task Force
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.


6. Transparency International
Financial Action Task Force
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
The world's largest private DB of stolen art.


7. What is one of the Financial Service Authority's (UK) tasks?
To reduce financial crime - including money laundering and terrorit financing.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
An introducing broker-dealer with an exclusive written agreement with a Futures Commission Merchant (FCM) that obligates the FCM to assume responsibility for the introducing broker's performance.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.


8. FATF Recommendation 25
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
Terrorism and Terrorist Financing


9. What is the aim of Joint Money Laundering Steering Group? (UK)
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
Middle East and North Africa Financial Action Task Force
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws


10. What tend to be the markings of Private Banking transactions?
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
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.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
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.


11. Free Look Period
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).
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.


12. FATF Recommendation 39
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.
disrupt or adversely afftect the business of the bank.
An account that does not show activity other than the posting of interest or account maintenance fees.
Countries should recognize money laundering as an extraditable offense.


13. Express Trust
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
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 CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.


14. What does FIU do beyond what FIU does?

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15. What does FIU do?
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.
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.
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
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.


16. How does 'Product Diversion' work?
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.
no regulatory power or function
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.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.


17. Why is 'Know Your Correspondent Bank' important?
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.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
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.


18. Agent (Insurance Industry)
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
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.
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
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.


19. USA Patriot Act Section 312 'Offshore Bank'
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
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 there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.


20. Abusive Squeezes

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21. FATF Recommendation 34
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.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.


22. Mutual Fund
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.
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
www.artloss.com


23. How does the Egmont group help its members?
Person who - for compensation - provides advice on securities and investments and manages client assets.
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
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.
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.


24. Who conducts the Financial Sector Assessment Program (FSAP)?
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
Middle East and North Africa Financial Action Task Force
The FIU of the UK
The International Monetary Fund (IMF) and the world bank conduct the joint program.


25. Cash Letter
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws


26. What is one of the cental stragetic tools required for effective action against money laundering?
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Confiscation
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.
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.


27. 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?
Funds transfers - Shell Corporations - Contractual Transactions.
Review customer files and conduct random sampling of accounts.
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.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].


28. FATF Recommendation 36
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
Provide mutual legal assistance.


29. Cash Equivalent

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30. What can result from on institution's disregard for the Basel Due Diligence Principle?
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
a chain-referral scheme.
that appear to be linked
Banking services between merchant banks and other financial institutions.


31. How are 'Predicate Crimes' sometimes identified?

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32. (Stock) Warrants
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
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.
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.
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.


33. 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.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.
No.


34. FATF's designated transactional threshold for Delaers is Precious metals and / or Precious Stones is _____.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Reliable - independent source of documents - data or information.
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.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)


35. Nostro

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36. MENAFATF
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
that appear to be linked
Middle East and North Africa Financial Action Task Force


37. Identification data
They can accrue value as the price of the underlying stock rises.
Reliable - independent source of documents - data or information.
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.
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.


38. 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.
May involve movement or large sums of money going cross-border and often through multiple casinos - all by a third party (the operator). Sometime operator does not identify funds owners.
The FIU of Russia
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.


39. (Credit Card) Issuing Bank
Typical mass-market banking where individual customers use local branches of larger commercial banks.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Solicits potential customers and issues the credit cards.
The FIU of the UK


40. What is private investment company also known as?
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
The US State Dept issues the report annually.
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.
www.artloss.com


41. Commodity
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
Report suspicious transactions linked to terrorism.
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.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.


42. Arrest Warrant
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
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.
Take immediate steps to ratify and implement the UN instruments.
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)


43. A 'panzi' scheme is named for whom?
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.
Pouch activity.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
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.


44. FATF Recommendation 33
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
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 ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.


45. Who issues the Internationa Narcotics Control Strategy Report (INCSR) and how often?
The US State Dept issues the report annually.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
Placement - Layering - Integration.
Letters Rogatory


46. Basel's 'CDD for Banks' states that the decision to open an account for a PEP should be taken at...
High-speed matching of known or suspected patterns in very large DB's using recognition algorithms.
a Sr Management level
It conducts investigations in support of a government's confiscation or seizure efforts.
Strengthen customer identification measures in iternational and domestic wire transfers.


47. 'Closed-end Mutual Fund' (Or Comany)

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48. Examples of White-collar crime
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.
An electronic quotation system that displays quotes of many securities traded over the counter.
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
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.


49. US law prohibhits Foriegn Shell Banks from ____?
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
Countering the Financing of Terrorism (Counter Terrorist Financing).
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.
To reduce financial crime - including money laundering and terrorit financing.


50. How do 'Hedge Funds' operate?

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