Test your basic knowledge |

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. Credit Card Associations
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
A market is which securities are bought and sold outside of establisehd securities markets.
that appear to be linked

2. Cash Equivalent

3. EAG
It conducts investigations in support of a government's confiscation or seizure efforts.
EurAsian Group
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
foreign correspondent banks

4. What do 'Hedge Funds' attempt to do?
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Futures contracts - forwards - swaps or options.

5. What can result from on institution's disregard for the Basel Due Diligence Principle?
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.
Confiscation
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.

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

7. Legal Arrangements (Insurance Industry)
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
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.
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]
Dealers in precious metals/stones - trust and company services providers - lawyers - notaries and accountants should all be required to report suspicious activity - but legal privilege cannot be violated.

8. Short Sale

9. In what country is the Egmont Group Secretariat now located?
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.
Canada
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Contract issued by an insurance company under which an investor provides the insurer with funds (a lump-sum or series of payments). The insurer then agrees to make periodic payments to the investor starting the immediately or in the future.

10. Common types of 'Derivatives'
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Futures contracts - forwards - swaps or options.
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.

11. CFT
bear the mark 'APOSTILLE'
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
Countering the Financing of Terrorism (Counter Terrorist Financing).

12. '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].
Futures contracts - forwards - swaps or options.
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.
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

13. Why is 'refining' critical to a money launderer's efforts?
If one needs to transport currency across borders - one needs to have the smallest package possible to avoid detection.
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
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.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).

14. Express Trust
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
Intergovernmental Action Group against Money Laundering in Africa
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.

15. FATF Sepcial Recommendation on Terrorist Financing -- SR Eight
Impose AML requirements on alternative remittance systems.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
Processes transactions for merchants who accept credit cards.

16. What does the 'SEC' (US Securities and Exchange Commission) do?
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.

17. FCPA (US)
Foreign Corrupt Practices Act
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
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.
Funds transfers - Shell Corporations - Contractual Transactions.

18. What is meant by 'Know Your Customer's customer'?
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
A market is which securities are bought and sold outside of establisehd securities markets.

19. Arrest Warrant
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 detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
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.

20. FATF Recommendation 18
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.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
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.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.

21. What is a Financial Intelligence Unit?
Harmful or Preferrential Tax Regimes.
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.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.

22. FATF Recommendation 38
People who help move the billions of dollars drug traffickers earn around the world.
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.
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.

23. Corporate Bank

24. Many jurisdictions have legislation to ensure that suspects are not ____?
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
tipped off that they are being investigated.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.

25. FATF Sepcial Recommendation on Terrorist Financing -- SR One
Take immediate steps to ratify and implement the UN instruments.
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.
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
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).

26. Fraud
They can accrue value as the price of the underlying stock rises.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.

27. FATF Recommendation 39
A US Federal Court
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 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.
Countries should recognize money laundering as an extraditable offense.

28. Dormant Account
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
Combines funds from various members and users them to trade in futures or options contracts.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
An account that does not show activity other than the posting of interest or account maintenance fees.

29. FATF Recommendation 26
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
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.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
Terrorism and Terrorist Financing

30. Open System Stored Value Card
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.
Financial Action Task Force
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.

31. FATF Recommendation 37
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
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).
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.

32. Commodity
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
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.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.

33. Cash Log

34. How are 'Predicate Crimes' sometimes identified?

35. Why is 'Know Your Correspondent Bank' important?
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.
Confiscation
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
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.

36. FATF Recommendations examples of non-financial businesses and professions
EurAsian Group
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.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.

37. In Emerging Money Laundering Risks - what 3 methods are identified as 'Funds Transfers'?
Competent authorities should have powers of subpoena - search and seizure.
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.
Stored Value Cards - Mobile Payments - Internet Payments.
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.

38. Respondent Bank

39. Automated Sale
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
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.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.

40. 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]
They can accrue value as the price of the underlying stock rises.
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
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.

41. FATF Recommendation 1
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
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.

42. Examples of White-collar crime
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
They pool investors' money and invest those funds in financial instruments in an effort to turn a profit. They typically issue securities in 'private offerings' that are usually not required to be registered with sa securities or financial regulator.
A 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.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

43. (Credit Card) Third-Party processor
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
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.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.

44. What are the three main functions of a 'Transfer Agent'?
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.
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).
If provided for money laundering to be an internationally extraditable offense.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].

45. UK courts view on 'Suspicion'
2% - 5% ($590B - $1.5T)
that appear to be linked
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
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.

46. A notary can issue a Apostille but it must be in a country that signed The Hague Convention (1961) and it must ___________. If the notary doesn't understand - find another one.

47. Who are the parties involved in a trust?
Provide mutual legal assistance.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
If provided for money laundering to be an internationally extraditable offense.

48. Cash Letter
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.

49. What does an Extradition Treaty specify?
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.
An electronic quotation system that displays quotes of many securities traded over the counter.
As 'felonies' or 'all offenses in the criminal code'.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.

50. How is 'Legal Risk' defined by the 2001 Basel Due Diligence Principles?
Competent authorities should have powers of subpoena - search and seizure.
Review customer files and conduct random sampling of accounts.
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.
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.