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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. What do 'Hedge Funds' attempt to do?
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
It was the first law in any country to make money laundering a crime.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.

2. Free Look Period
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
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
Financial Action Task Force on Money Laundering in South America
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.

3. Example of use of an Apostille
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.
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.
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
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).

4. Penny Stocks
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
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.
Open and Closed system

5. 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
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
Pouch activity.
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.
Harmful or Preferrential Tax Regimes.

6. Portfolio Manager
Countries should recognize money laundering as an extraditable offense.
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.
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
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'

7. Underwriting
They can accrue value as the price of the underlying stock rises.
Strengthen customer identification measures in iternational and domestic wire transfers.
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.
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.

8. When was the Offshore Group of Banking Supervisors established? What was the impetus behind its establishment?
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.

9. 'Introducing Broker-Dealers in Commodities' (IB-C)

10. May a shell bank maintain a correspondent account with a US bank?
No.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Financial Action Task Force on Money Laundering in South America
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.

11. Basel's 'CDD for Banks' states that the decision to open an account for a PEP should be taken at...
a Sr Management level
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.
Review customer files and conduct random sampling of accounts.
foreign correspondent banks

12. FATF Recommendation 27
The FIU of Russia
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
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.

13. What does Financial Sector AssessmentProgram (FSAP) do?
Funds transfers - Shell Corporations - Contractual Transactions.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
As a financial institution service that is very vulnerable to money laundering.

14. What is the Federal Service for Financial Monitoring?
A US Federal Court
The FIU of Russia
Money Laundering and Tax Evasion
The FIU of the UK

15. FATF Recommendation 36
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
Provide mutual legal assistance.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.

16. Where is the Art Loss Register found?
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
bear the mark 'APOSTILLE'
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
www.artloss.com

17. US law prohibhits Foriegn Shell Banks from ____?
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Confiscation
Expatriates sending money back to their home country or by other individuals sending money abroad.

18. FATF Recommendation 20
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
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.

19. FATF Recommendation 39
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.
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.
Countries should recognize money laundering as an extraditable offense.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.

20. Examples of VSP's
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.

21. Who are the parties involved in a trust?
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.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
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.

22. Automated Sale
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.
that appear to be linked
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.

23. How is 'Legal Risk' defined by the 2001 Basel Due Diligence Principles?
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
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.
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.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).

24. Identification data
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.
Reliable - independent source of documents - data or information.
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.

25. What are included in the Wolfsberg AML Principles on Private Banking?
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
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.
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'

26. FATF Recommendation 33
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
a chain-referral scheme.
a Sr Management level
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.

27. FATF Recommendation 22

28. What is the significance of 'Non-Financial Trades and Businesses' in realtion to Money Laundering?
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
Processes transactions for merchants who accept credit cards.
Letters Rogatory
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).

29. Options/Options Contract
Letters Rogatory
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
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).
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.

30. FATF Recommendation 6
EurAsian Group
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
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'.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.

31. Commodity
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
Countering the Financing of Terrorism (Counter Terrorist Financing).

32. FATF Recommendation 5
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
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.

33. Investigative Log
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
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.
Review customer files and conduct random sampling of accounts.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.

34. Retail Banking
As 'felonies' or 'all offenses in the criminal code'.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
EurAsian Group
Typical mass-market banking where individual customers use local branches of larger commercial banks.

35. What do boiler room salespeople typically sell?
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
Penny Stocks
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
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]

36. Characteristics of an 'Open System Stored Value Card'
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
Often co-branded by financial institution; may have VISA or MasterCard logos; can be reloadable; usually can access ATMs for withdrawls globally; non-customers can buy them.
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.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.

37. When is a jurisdiction considered to be 'ring-fenced'?
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
Placement - Layering - Integration.
Corporate bond that includes an option for the holder to convert it into other securities after a specified period at the discretion of the bondholder.
Impose AML requirements on alternative remittance systems.

38. FATF Recommendations examples of non-financial businesses and professions
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
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
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.

39. Margin
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
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.
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.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.

40. Common types of 'Derivatives'
2% - 5% ($590B - $1.5T)
Strengthen customer identification measures in iternational and domestic wire transfers.
Futures contracts - forwards - swaps or options.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.

41. Why is understanding 'Product Diversion' important to the AML investigator?
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
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.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
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.

42. FATF Recommendation 35
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
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.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
People who help move the billions of dollars drug traffickers earn around the world.

43. What tend to be the markings of Private Banking transactions?
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
An electronic quotation system that displays quotes of many securities traded over the counter.
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.

44. FATF Recommendation 29
Person who - for compensation - provides advice on securities and investments and manages client assets.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
Placement - Layering - Integration.

45. What do boiler room salespeople typically do?

46. The Joint Money Laundering Steering Group (UK) has published a series of AML Guidance Notes for different sectors of the financial community. But - As a group of trade associations - it has...
As a financial institution service that is very vulnerable to money laundering.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
no regulatory power or function
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.

47. What does an Extradition Treaty specify?
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
As a financial institution service that is very vulnerable to money laundering.
no regulatory power or function
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.

48. Cash Equivalent

49. What does FIU do?
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
EurAsian Group
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
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).

50. What is a 'NCCT'?
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
Solicits potential customers and issues the credit cards.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
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.