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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. UK courts view on 'Suspicion'
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).
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.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
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.

2. Dormant Account
An account that does not show activity other than the posting of interest or account maintenance fees.
Freeze and confiscate terrorist assets.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
It conducts investigations in support of a government's confiscation or seizure efforts.

3. FATF Recommendation 17
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.

4. Distribution Channels (Insurance Industry)
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
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]
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws

5. What is the Serious Organised Crime Agency (SOCA)?
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
www.artloss.com
The FIU of the UK

6. FATF Sepcial Recommendation on Terrorist Financing -- SR Two
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
The FIU of the UK

7. Account Monitoring Order (UK and several other countries)
Canada
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism

8. According to FATF - financial transactions above a designated threshold may include situations where the transaction takes place in a single operation or in several operations...
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]
that appear to be linked
Futures contracts - forwards - swaps or options.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.

9. FATF's designated transactional threshold for Delaers is Precious metals and / or Precious Stones is _____.
As a financial institution service that is very vulnerable to money laundering.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
If provided for money laundering to be an internationally extraditable offense.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.

10. Abusive Squeezes

11. FATF Recommendation 2
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.
Provide mutual legal assistance.
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.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.

12. FATF
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.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
Financial Action Task Force

13. How are 'Predicate Crimes' sometimes identified?

14. What are the three main functions of a 'Transfer Agent'?
Canada
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
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.
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.

15. A 'Cash Letter' can also be referred to as _____.
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 world's largest private DB of stolen art.
Pouch activity.
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.

16. FATF Recommendation 13
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.

17. Who appoints a 'Federal Receiver' (US)?
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
A US Federal Court

18. FATF Recommendation 9
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.
Applied by an authority - it is a special seal which certifies that a document is a true copy of an original. However - it does not and cannot speak to the validity of the document's content.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Direct or indirect advisor on buying and selling futures or commodity options.

19. What was the target of UN Security Council Resolution 1373?
Middle East and North Africa Financial Action Task Force
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.
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
Terrorism and Terrorist Financing

20. FATF Recommendation 40
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.
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
If one needs to transport currency across borders - one needs to have the smallest package possible to avoid detection.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.

21. What does Financial Sector AssessmentProgram (FSAP) do?
Freeze and confiscate terrorist assets.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
An account that does not show activity other than the posting of interest or account maintenance fees.
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. Corporate Bank

23. How is 'Legal Risk' defined by the 2001 Basel Due Diligence Principles?
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.
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.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.

24. FATF Recommendation 29
People who help move the billions of dollars drug traffickers earn around the world.
A co-operative property seller agrees to sell home at a well-below market reported price - then accepts the difference 'under the table'. When launderer later sells house - he recognizes 'gain' and all funds appear legitimate as it sold at market.
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
Take immediate steps to ratify and implement the UN instruments.

25. Portfolio Manager
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.
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.
Freeze and confiscate terrorist assets.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.

26. '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].
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).
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
Stored Value Cards - Mobile Payments - Internet Payments.

27. Characteristics of an 'Open System Stored Value Card'
Money Laundering and Tax Evasion
Competent authorities should have powers of subpoena - search and seizure.
Respondent banks may be used by other banks and customers to conduct transactions through a correspondent account.
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.

28. FATF Recommendation 32
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).
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
www.artloss.com
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization

29. Affidavit
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
Reliable - independent source of documents - data or information.
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.
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.

30. GIABA
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
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]
Intergovernmental Action Group against Money Laundering in Africa
Because it represents funds drawn on the account of a financial institution and not on a particular individual.

31. The 'Art Loss Register'

32. Cash Log

33. FATF Recommendation 31
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
no regulatory power or function
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.

34. USA Patriot Act Section 312 'Offshore Bank'
A market is which securities are bought and sold outside of establisehd securities markets.
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.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.

35. What does FIU do?
Letters Rogatory
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.
Penny Stocks
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.

36. Convertible Bond
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.
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.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.

37. FCPA (US)
Banking services between merchant banks and other financial institutions.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
Foreign Corrupt Practices Act
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.

38. What does an Extradition Treaty specify?
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
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 Sr Management level
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.

39. Commodity
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
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).
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.

40. What is a Private Investment company (PIC)?
Report suspicious transactions linked to terrorism.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
a chain-referral scheme.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.

41. Why is 'Know Your Correspondent Bank' important?
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
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.
Letters Rogatory

42. Why is understanding 'Product Diversion' important to the AML investigator?
Countries should recognize money laundering as an extraditable offense.
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.
Combines funds from various members and users them to trade in futures or options contracts.
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.

43. Operational risks in KYC context relate to...
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
Solicits potential customers and issues the credit cards.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.

44. What is a 'Trust'?
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.
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.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
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.

45. Why does a launderer try to run transactions through a concentration account of a financial institution?
As 'felonies' or 'all offenses in the criminal code'.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
Reliable - independent source of documents - data or information.

46. A public perception that a bank is not able to manage its operational risk effectively can...
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
disrupt or adversely afftect the business of the bank.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.

47. Money Mules
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.
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 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.
Foreign Corrupt Practices Act

48. FATF Recommendation 33
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
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).
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
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.

49. In general terms - EDD requires what of a financial institution?

50. What is a Financial Intelligence Unit?
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
As 'felonies' or 'all offenses in the criminal code'.