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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. Should one ever file a Suspicious Transaction Report (STR/SAR) based on a person's profile?

2. (Credit Card) Third-Party processor
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
Take immediate steps to ratify and implement the UN instruments.
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 prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.

3. Express Trust
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
Direct or indirect advisor on buying and selling futures or commodity options.

4. A 'panzi' scheme is named for whom?
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
Direct or indirect advisor on buying and selling futures or commodity options.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
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.

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

6. OTC markets Over-The-Counter
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
A market is which securities are bought and sold outside of establisehd securities markets.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

7. FATF Sepcial Recommendation on Terrorist Financing -- SR Nine
Stored Value Cards - Mobile Payments - Internet Payments.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
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.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.

8. What is private investment company also known as?
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
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.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
Freeze and confiscate terrorist assets.

9. In what country is the Egmont Group Secretariat now located?
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
Canada
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.

10. Agent (Insurance Industry)
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
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.
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

11. FATF Recommendation 35
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
Terrorism and Terrorist Financing

12. Market Manipulation
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.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
A deliberate attempt to interfere with the free and fair operation of the market and create artificial - false or misleading appearances with respect to the price of - or market for a security - commodity or currency.
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.

13. Distribution Channels (Insurance Industry)
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.
bear the mark 'APOSTILLE'
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]
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.

14. Variable Annuity
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.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Take immediate steps to ratify and implement the UN instruments.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.

15. FATF Recommendation 14
The US State Dept issues the report annually.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.

16. What is meant by 'Know Your Customer's customer'?
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
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.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
Respondent banks may be used by other banks and customers to conduct transactions through a correspondent account.

17. Under the US Bank Secrecy Act - SAR filings are confidential and the institutions employees cannot ____?

18. Three stages of money laundering
Use of electronic clearing houses to facilitate electronic transfers of money that complete transactions between two parties where the buyer receives securities - goods - services etc. in exchange for the money.
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
The FIU of the UK
Placement - Layering - Integration.

19. What do 'Hedge Funds' attempt to do?
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
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.
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.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.

20. 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...
foreign correspondent banks
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 trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.

21. Automated Sale
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.
Use of electronic clearing houses to facilitate electronic transfers of money that complete transactions between two parties where the buyer receives securities - goods - services etc. in exchange for the money.
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.
Provide mutual legal assistance.

22. What is a Financial Intelligence Unit?
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.
If provided for money laundering to be an internationally extraditable offense.
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.

23. FATF Recommendation 40
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
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.
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
They can accrue value as the price of the underlying stock rises.

24. FATF Recommendation 25
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
They can accrue value as the price of the underlying stock rises.

25. FCPA (US)
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
To reduce financial crime - including money laundering and terrorit financing.
Foreign Corrupt Practices Act

26. What is one of the cental stragetic tools required for effective action against money laundering?
Funds transfers - Shell Corporations - Contractual Transactions.
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
Confiscation
'Tip Off' a customer that a report has been filed. Failure to maintain confidentiality is a violation of law.

27. FATF Recommendation 24
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
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.
Foreign Corrupt Practices Act
Direct or indirect advisor on buying and selling futures or commodity options.

28. (Stock) Warrants
Person who - for compensation - provides advice on securities and investments and manages client assets.
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.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
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.

29. Legal Arrangements (Insurance Industry)
Direct or indirect advisor on buying and selling futures or commodity 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.
Refers to express trusts or other similar legal arrangements - such as fiducie - treuhand and fideicomiso [FATF Risk-Based approach - Guidance for the Life Insurance Sector - Oct 09]
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.

30. FATF Recommendation 26
Penny Stocks
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
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.

31. Cash Letter
have in place compulsory currency reporting requirements.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
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.

32. What is the FCPA primarily known for?
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).
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).
Solicits potential customers and issues the credit cards.
It conducts investigations in support of a government's confiscation or seizure efforts.

33. Cash Equivalent

34. 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...
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
Processes transactions for merchants who accept credit cards.
that appear to be linked
They can accrue value as the price of the underlying stock rises.

35. FATF Recommendation 33
no regulatory power or function
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).
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.

36. FATF Recommendation 4
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
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.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
The opposing part of a transaction or trade.

37. Cash Log

38. Corporate Bank

39. Commodity Pool Operator
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
People who help move the billions of dollars drug traffickers earn around the world.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.

40. May a shell bank maintain a correspondent account with a US bank?
that appear to be linked
Funds transfers - Shell Corporations - Contractual Transactions.
No.
Intergovernmental Action Group against Money Laundering in Africa

41. Why does a launderer try to run transactions through a concentration account of a financial institution?
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
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.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.

42. What is the goal of FSAP?
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
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
no regulatory power or function
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.

43. Investigative Log
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Refers to express trusts or other similar legal arrangements - such as fiducie - treuhand and fideicomiso [FATF Risk-Based approach - Guidance for the Life Insurance Sector - Oct 09]
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).

44. What does theInternationa Narcotics Control Strategy Report (INCSR) entail?
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
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.

45. Bust-out
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
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

46. FATF's designated transactional threshold for Casinos (including Internet Casinos) is _____.
Solicits potential customers and issues the credit cards.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
EurAsian Group
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

47. 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.
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.
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.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.

48. FATF Sepcial Recommendation on Terrorist Financing -- SR One
Provide mutual legal assistance.
Take immediate steps to ratify and implement the UN instruments.
that appear to be linked
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.

49. In Emerging Money Laundering Risks - what 3 areas are associated with 'Contractual Transactions'?
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
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.
no regulatory power or function
Real Estate - Insurance Transactions - Trade-Based Money Laundering.

50. Derivatives
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
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.