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. OCC Office of the Comptroller of the Currency
A US Federal Court
foreign correspondent banks
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.


2. The Vienns Convention
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Futures contracts - forwards - swaps or options.


3. FATF Recommendation 10
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
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
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.
A US Federal Court


4. Reverse Flip

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5. Who appoints a 'Federal Receiver' (US)?
A US Federal Court
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
If provided for money laundering to be an internationally extraditable offense.
a Sr Management level


6. How is 'Legal Risk' defined by the 2001 Basel Due Diligence Principles?
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.
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.
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
They can accrue value as the price of the underlying stock rises.


7. FATF
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
Financial Action Task Force
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
The US State Dept issues the report annually.


8. MENAFATF
Reliable - independent source of documents - data or information.
Middle East and North Africa Financial Action Task Force
www.artloss.com
It conducts investigations in support of a government's confiscation or seizure efforts.


9. SRO (Self-Regulatory Organizations)
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]
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
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.
To reduce financial crime - including money laundering and terrorit financing.


10. FATF Recommendation 1
No.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
The FIU of the UK


11. FATF Recommendation 38
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.
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
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.
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.


12. Nostro

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13. Examples of White-collar crime
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
A US Federal Court
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
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.


14. FATF Sepcial Recommendation on Terrorist Financing -- SR One
Competent authorities should have powers of subpoena - search and seizure.
Take immediate steps to ratify and implement the UN instruments.
FATF principles should apply to all branches and subsidiaries of a financial institution - even those abroad. Inability to do should re reported to parent institution's regulatory/supervisory authority.
If provided for money laundering to be an internationally extraditable offense.


15. May a shell bank maintain a correspondent account with a US bank?
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
No.
Combines funds from various members and users them to trade in futures or options contracts.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.


16. Guaranteed Introducing Broker

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17. Cash Log

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18. What were recently identified as Emerging Money Laundering risks?
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
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.
Funds transfers - Shell Corporations - Contractual Transactions.


19. 'Loan Back' method. Give example of how it works.

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20. FATF Recommendation 19
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.


21. What does the principal US money laundering law look for before implementing its 'Extraterritorial Reach'?
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).
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
If provided for money laundering to be an internationally extraditable offense.


22. In what country is the Egmont Group Secretariat now located?
a Sr Management level
An account that does not show activity other than the posting of interest or account maintenance fees.
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.
Canada


23. FATF Recommendation 2
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.


24. Scheme
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.
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.
Financial Action Task Force on Money Laundering in South America
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.


25. The 'Art Loss Register'

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26. USA Patriot Act Section 312 'Offshore Bank'
To reduce financial crime - including money laundering and terrorit financing.
Urge investors to buy 'house stocks' - stocks that the firm buys and sells as a market maker or has in its inventory. Oftentimes - they are running a 'pump-and-dumo' scheme.
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 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.


27. Where is the Art Loss Register found?
www.artloss.com
An account that does not show activity other than the posting of interest or account maintenance fees.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
Open and Closed system


28. What are the three main functions of a 'Transfer Agent'?
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
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.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.


29. FATF Recommendation 14
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.
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
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.
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.


30. 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
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
Stored Value Cards - Mobile Payments - Internet Payments.
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.
Harmful or Preferrential Tax Regimes.


31. Behaviour detection

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32. FATF Recommendation 35
An account that does not show activity other than the posting of interest or account maintenance fees.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
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
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.


33. FATF Sepcial Recommendation on Terrorist Financing -- SR Eight
Freeze and confiscate terrorist assets.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
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.
2% - 5% ($590B - $1.5T)


34. Counter Party
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
The opposing part of a transaction or trade.
Foreign Corrupt Practices Act


35. FATF Recommendation 39
Countries should recognize money laundering as an extraditable offense.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.


36. Mutual Fund
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
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.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.


37. How do most governments view Private Banking?
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
Financial Action Task Force on Money Laundering in South America
As a financial institution service that is very vulnerable to money laundering.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.


38. EAG
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
Countering the Financing of Terrorism (Counter Terrorist Financing).
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
EurAsian Group


39. What does an Extradition Treaty specify?
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.
Intergovernmental Action Group against Money Laundering in Africa
Money Laundering and Tax Evasion
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.


40. Commodity
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.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.


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

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42. Who conducts the Financial Sector Assessment Program (FSAP)?
The International Monetary Fund (IMF) and the world bank conduct the joint program.
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).
Futures contracts - forwards - swaps or options.
Confiscation


43. A public perception that a bank is not able to manage its operational risk effectively can...
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.
EurAsian Group
disrupt or adversely afftect the business of the bank.
Penny Stocks


44. Characteristics of an 'Open System Stored Value Card'
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.
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
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.
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.


45. Moneyval
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.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.


46. Many jurisdictions have legislation to ensure that suspects are not ____?
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
tipped off that they are being investigated.


47. The IMF estimates that laundered funds compromise ______ of the world's GDP
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
2% - 5% ($590B - $1.5T)
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
www.artloss.com


48. What must a financial institution do if they have 'Exempt Accounts'?
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 exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
www.artloss.com
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.


49. CFT
As a financial institution service that is very vulnerable to money laundering.
Countering the Financing of Terrorism (Counter Terrorist Financing).
As 'felonies' or 'all offenses in the criminal code'.
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.


50. FATF Recommendation 26
It conducts investigations in support of a government's confiscation or seizure efforts.
Stored Value Cards - Mobile Payments - Internet Payments.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.