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) Acquiring Bank
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
The opposing part of a transaction or trade.
Processes transactions for merchants who accept credit cards.
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.

2. FATF
Financial Action Task Force
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
An electronic quotation system that displays quotes of many securities traded over the counter.
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.

3. Pink Sheets
To reduce financial crime - including money laundering and terrorit financing.
An electronic quotation system that displays quotes of many securities traded over the counter.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
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.

4. What is meant by 'Know Your Customer's customer'?
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
Financial Action Task Force
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.

5. FATF Recommendation 13
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.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
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.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.

6. 'Open-end Mutual Fund' (or Company)

7. OTC markets Over-The-Counter
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.
A market is which securities are bought and sold outside of establisehd securities markets.
no regulatory power or function
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.

8. In what country is the Egmont Group Secretariat now located?
Canada
Person who - for compensation - provides advice on securities and investments and manages client assets.
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
Take immediate steps to ratify and implement the UN instruments.

9. Futures Commission Merchant (FCM)
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
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
Impose AML requirements on alternative remittance systems.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.

10. How is 'Identity theft' often accomplished?
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.

11. Mutual Fund
2% - 5% ($590B - $1.5T)
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
People who help move the billions of dollars drug traffickers earn around the world.

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].
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
Expatriates sending money back to their home country or by other individuals sending money abroad.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.

13. Portfolio Manager
Canada
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'.
Direct or indirect advisor on buying and selling futures or commodity options.
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.

14. Basel's 'CDD for Banks' states that the decision to open an account for a PEP should be taken at...
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
Respondent banks may be used by other banks and customers to conduct transactions through a correspondent account.
a Sr Management level
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.

15. Investment Adviser
Person who - for compensation - provides advice on securities and investments and manages client assets.
disrupt or adversely afftect the business of the bank.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.

16. EAG
EurAsian Group
www.artloss.com
Banking services between merchant banks and other financial institutions.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].

17. Wire Transfers
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
Provide mutual legal assistance.

18. What is a Financial Intelligence Unit?
Take immediate steps to ratify and implement the UN instruments.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.

19. FATF Recommendation 9
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
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.
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
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.

20. FATF Recommendation 23
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
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'.
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.
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.

21. What is the goal of the Egmont group?

22. What is the goal of FSAP?
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
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
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.

23. Open System Stored Value Card
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
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.
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

24. Reverse Flip

25. How does the Egmont group help its members?
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
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.
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.
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.

26. Convertible Preferred
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Freeze and confiscate terrorist assets.
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

27. 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.
The FIU of Russia
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
Financial Action Task Force on Money Laundering in South America

28. FCPA (US)
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.
Foreign Corrupt Practices Act
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
As 'felonies' or 'all offenses in the criminal code'.

29. FATF Recommendation 39
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
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
Countries should recognize money laundering as an extraditable offense.
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.

30. How do 'Hedge Funds' operate?

31. Commodity Pool
Combines funds from various members and users them to trade in futures or options contracts.
The FIU of Russia
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 world's largest private DB of stolen art.

32. What is the primary use of a 'Mutual Legal Assistance Treaty'?
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.
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.
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.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.

33. FATF Sepcial Recommendation on Terrorist Financing -- SR Five

34. FATF Recommendation 35
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
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 merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.

35. A public perception that a bank is not able to manage its operational risk effectively can...
disrupt or adversely afftect the business of the bank.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
Money Laundering and Tax Evasion
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 Recommendation 18
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'
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 electronic quotation system that displays quotes of many securities traded over the counter.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.

37. FATF Recommendation 19
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.
Terrorism and Terrorist Financing
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.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.

38. Apostille

39. FATF Recommendation 36
Provide mutual legal assistance.
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
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.
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]

40. FATF Recommendation 5
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
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 UN Convention against Transnational Organized Crime [Adopted 12/2000].
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data

41. GAFISUD
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
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
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
Financial Action Task Force on Money Laundering in South America

42. What is one of the Financial Service Authority's (UK) tasks?
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
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.
To reduce financial crime - including money laundering and terrorit financing.
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.

43. 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.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Futures contracts - forwards - swaps or options.
Freeze and confiscate terrorist assets.

44. What is the significance of 'Non-Financial Trades and Businesses' in realtion to Money Laundering?
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
To reduce financial crime - including money laundering and terrorit financing.
Person who - for compensation - provides advice on securities and investments and manages client assets.

45. 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.
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'.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.

46. What criterion does the US need to enforce its 'Extraterritorial Reach'?

47. Structuring is a common technique in jurisdictions that...
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
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.
People who help move the billions of dollars drug traffickers earn around the world.
have in place compulsory currency reporting requirements.

48. FATF Recommendation 30
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
A fund setup by an investment trust that issues a fixed number of shares to its investors. As such - the market price of the shares fluctuates - often selling at a premium or discount to the fund's net asset value (NAV).
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.

49. FATF Recommendation 6
Respondent banks may be used by other banks and customers to conduct transactions through a correspondent account.
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.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
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.

50. Credit Card Associations
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.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
Banking services between merchant banks and other financial institutions.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.