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Certified Anti Money Laundering Specialist Cams

Instructions:

Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can study here.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. Example of use of an Apostille
EurAsian Group
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
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.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.

2. Cash Equivalent

3. OCC Office of the Comptroller of the Currency
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.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.

4. FATF Sepcial Recommendation on Terrorist Financing -- SR Two
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.
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
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.
No.

5. Open System Stored Value Card
The US State Dept issues the report annually.
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 transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.

6. What must a financial institution do if they have 'Exempt Accounts'?
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
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.
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.
Direct or indirect advisor on buying and selling futures or commodity options.

7. What is the goal of the Egmont group?

8. Why is 'Know Your Customer's Customer' important?
Respondent banks may be used by other banks and customers to conduct transactions through a correspondent account.
Processes transactions for merchants who accept credit cards.
Canada
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].

9. FATF Recommendation 3
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
Pouch activity.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.

10. What are included in the Wolfsberg AML Principles on Private Banking?
Combines funds from various members and users them to trade in futures or options contracts.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.

11. Nostro

12. Free Look Period
Pouch activity.
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
An account that does not show activity other than the posting of interest or account maintenance fees.

13. The Palemo Convention
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.

14. FATF Recommendation 34
Impose AML requirements on alternative remittance systems.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.

15. What normal business practise makes 'Product Division' possible?
Person who - for compensation - provides advice on securities and investments and manages client assets.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
It conducts investigations in support of a government's confiscation or seizure efforts.
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.

16. FATF Recommendation 38
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.
Harmful or Preferrential Tax Regimes.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
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.

17. What was the effect of the 1988 Vienna Convention as it relates to extradtition?
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
If provided for money laundering to be an internationally extraditable offense.
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
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.

18. FATF Recommendation 27
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.
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.

19. The 'Art Loss Register'

20. 'Competent Authorities' refers to _____.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
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.
Intergovernmental Action Group against Money Laundering in Africa

21. FATF's designated transactional threshold for Casinos (including Internet Casinos) is _____.
Countering the Financing of Terrorism (Counter Terrorist Financing).
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.

22. Short Sale

23. What is a Financial Intelligence Unit?
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
foreign correspondent banks
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.

24. Boiler Room
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
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.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
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.

25. What is important about the US Money Laundering Control Act (MCLA)?
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
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
It was the first law in any country to make money laundering a crime.

26. Foriegn Shell Banks are vehicles for ______ & ______?
As a financial institution service that is very vulnerable to money laundering.
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
Money Laundering and Tax Evasion
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.

27. FATF Recommendation 14
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
The FIU of Russia
Funds transfers - Shell Corporations - Contractual Transactions.

28. FATF Recommendation 10
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
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.
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.

29. Many jurisdictions have legislation to ensure that suspects are not ____?
Reliable - independent source of documents - data or information.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
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.
tipped off that they are being investigated.

30. May a shell bank maintain a correspondent account with a US bank?
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
No.
Review customer files and conduct random sampling of accounts.

31. What was the target of UN Security Council Resolution 1373?
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
Terrorism and Terrorist Financing
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.

32. Convertible Preferred
Take immediate steps to ratify and implement the UN instruments.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.

33. Respondent Bank

34. What the primary objectives of Offshore Group of Banking Supervisors?
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.
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.
A market is which securities are bought and sold outside of establisehd securities markets.

35. Who issues the Internationa Narcotics Control Strategy Report (INCSR) and how often?
The US State Dept issues the report annually.
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.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
Countries should recognize money laundering as an extraditable offense.

36. A 'panzi' scheme is named for whom?
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
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.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.

37. What does a 'Commission Rogatoire' normally specify?
Countries should recognize money laundering as an extraditable offense.
a Sr Management level
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
The nature of the request - the relevant criminal charges in the requesting country - the legal provision under which the request is made - and the information that is sought.

38. What is the Serious Organised Crime Agency (SOCA)?
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
2% - 5% ($590B - $1.5T)
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
The FIU of the UK

39. GAFISUD
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]
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Financial Action Task Force on Money Laundering in South America
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.

40. What is one of the cental stragetic tools required for effective action against money laundering?
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
Confiscation
Futures contracts - forwards - swaps or options.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.

41. A pyramid scheme is also called...
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.
a chain-referral scheme.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
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.

42. FATF Sepcial Recommendation on Terrorist Financing -- SR Eight
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
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.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].

43. Moneyval
The FIU of Russia
Freeze and confiscate terrorist assets.
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism

44. FATF Recommendation 37
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
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.

45. FATF Recommendation 24
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.
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
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.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.

46. FATF Recommendation 11
Stored Value Cards - Mobile Payments - Internet Payments.
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.
Review customer files and conduct random sampling of accounts.
Reliable - independent source of documents - data or information.

47. Investment Adviser
It conducts investigations in support of a government's confiscation or seizure efforts.
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
Person who - for compensation - provides advice on securities and investments and manages client assets.
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.

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

49. A 'Cash Letter' can also be referred to as _____.
The International Monetary Fund (IMF) and the world bank conduct the joint program.
Competent authorities should have powers of subpoena - search and seizure.
Pouch activity.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.

50. How do most governments view Private Banking?
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Strengthen customer identification measures in iternational and domestic wire transfers.
As a financial institution service that is very vulnerable to money laundering.
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.