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. Portfolio Manager
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
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.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.


2. What normal business practise makes 'Product Division' possible?
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
An account that does not show activity other than the posting of interest or account maintenance fees.


3. Where is the Art Loss Register found?
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
www.artloss.com
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.


4. Why is understanding 'Product Diversion' important to the AML investigator?
no regulatory power or function
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.
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.


5. Investment Adviser
Person who - for compensation - provides advice on securities and investments and manages client assets.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
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).
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.


6. Why is 'Know Your Correspondent Bank' important?
Terrorism and Terrorist Financing
The FIU of Russia
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.


7. FATF Recommendation 19
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
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.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.
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.


8. 'Coucil of Europe Convention on Laundering - Search - Seizure and Confiscation of the Proceeds from Crime' is known for what?
Open and Closed system
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
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.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].


9. A public perception that a bank is not able to manage its operational risk effectively can...
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
disrupt or adversely afftect the business of the bank.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.


10. Agent (Insurance Industry)
Refers to where the agent is acting under a contractual arrangement with the insurer to carry out its CDD functions (i.e. the agent is regarded as synonymous with the insurer) [FATF Risk-Based approach - Guidance for the Life Insurance Sector - Oct 0
The 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.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.


11. What is a Private Investment company (PIC)?
Intergovernmental Action Group against Money Laundering in Africa
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
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.
A record that financial institutions must retain for each cash sale of bank checks - drafts - money orders - cashier's checks and traveller's checks between $3 -000 and $10 -000.


12. White-Collar crime

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13. Scheme
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.
An account that does not show activity other than the posting of interest or account maintenance fees.
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 merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.


14. What were recently identified as Emerging Money Laundering risks?
It conducts investigations in support of a government's confiscation or seizure efforts.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Funds transfers - Shell Corporations - Contractual Transactions.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.


15. Structuring is a common technique in jurisdictions that...
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.
have in place compulsory currency reporting requirements.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
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).


16. What is the goal of the Egmont group?

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17. In Emerging Money Laundering Risks - what 3 methods are identified as 'Funds Transfers'?
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
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).
Stored Value Cards - Mobile Payments - Internet Payments.
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.


18. FATF Recommendation 17
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.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.


19. What is the primary use of a 'Mutual Legal Assistance Treaty'?
Middle East and North Africa Financial Action Task Force
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
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.


20. Apostille

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21. US law prohibhits Foriegn Shell Banks from ____?
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
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.


22. Arrest Warrant
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.
no regulatory power or function
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.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.


23. A 'Cash Letter' can also be referred to as _____.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Pouch activity.
Expatriates sending money back to their home country or by other individuals sending money abroad.
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.


24. What is important about the US Money Laundering Control Act (MCLA)?
It was the first law in any country to make money laundering a crime.
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.
Confiscation
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.


25. OCC Office of the Comptroller of the Currency
Combines funds from various members and users them to trade in futures or options contracts.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
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.
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.


26. FATF Recommendation 13
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
It conducts investigations in support of a government's confiscation or seizure efforts.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.


27. Abusive Squeezes

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28. Who issues the Internationa Narcotics Control Strategy Report (INCSR) and how often?
Account established by a domestic banking institution to receive deposits from - make payments on behalf of - or handle other financial transactions for a foreign financial institution - usually in the foreign financial institutions's cureency.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).
The US State Dept issues the report annually.


29. What was the target of UN Security Council Resolution 1267?
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).
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
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.


30. What is the FCPA primarily known for?
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
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.
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).


31. Credit Card Associations
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.


32. What do 'Hedge Funds' attempt to do?
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
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.


33. Affidavit
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
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.
A written statement given under oath before an officer of the court - notary public - or other authorized person. Commonly used as the factual basis for an application for a search - arrest or seizure warrant.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.


34. Open System Stored Value Card
The FIU of the UK
a Sr Management level
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.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.


35. FATF Recommendation 29
Combines funds from various members and users them to trade in futures or options contracts.
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 contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.


36. What was the target of UN Security Council Resolution 1373?
Terrorism and Terrorist Financing
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).
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.


37. FCPA (US)
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
Foreign Corrupt Practices Act
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Open and Closed system


38. FATF Recommendation 20
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 apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
To reduce financial crime - including money laundering and terrorit financing.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.


39. How do 'Hedge Funds' operate?

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40. FATF Recommendation 34
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
Solicits potential customers and issues the credit cards.
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


41. Investigative Log
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.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
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.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.


42. FATF Recommendation 22

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43. FATF's designated transactional threshold for Financial Insitutions is _____.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
www.artloss.com


44. FATF Recommendation 14
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
A market is which securities are bought and sold outside of establisehd securities markets.
The world's largest private DB of stolen art.


45. The USA Patriot Act enacted a number of statutory provisions that bear directly on the procedures US financial institutions must follow in connection with their...
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
May involve movement or large sums of money going cross-border and often through multiple casinos - all by a third party (the operator). Sometime operator does not identify funds owners.
Report suspicious transactions linked to terrorism.
foreign correspondent banks


46. What are the three main functions of a 'Transfer Agent'?
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
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.
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.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.


47. FATF Recommendation 33
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).
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.


48. What is the Federal Service for Financial Monitoring?
The FIU of Russia
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
Competent authorities should have powers of subpoena - search and seizure.
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.


49. Options/Options Contract
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.
that appear to be linked
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Strengthen customer identification measures in iternational and domestic wire transfers.


50. Why is a 'money order' attractive to a money launderer?
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
People who help move the billions of dollars drug traffickers earn around the world.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.