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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. FATF Recommendation 16
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Dealers in precious metals/stones - trust and company services providers - lawyers - notaries and accountants should all be required to report suspicious activity - but legal privilege cannot be violated.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.

2. 'Coucil of Europe Convention on Laundering - Search - Seizure and Confiscation of the Proceeds from Crime' is known for what?
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.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
As 'felonies' or 'all offenses in the criminal code'.

3. FATF Recommendation 8
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.
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.

4. Short Sale

5. Counter Party
The opposing part of a transaction or trade.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
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 International Monetary Fund (IMF) and the world bank conduct the joint program.

6. FATF Sepcial Recommendation on Terrorist Financing -- SR Seven
The FIU of Russia
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
Strengthen customer identification measures in iternational and domestic wire transfers.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).

7. The IMF estimates that laundered funds compromise ______ of the world's GDP
2% - 5% ($590B - $1.5T)
No.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
Pouch activity.

8. A 'Cash Letter' can also be referred to as _____.
Pouch activity.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
www.artloss.com

9. Characteristics of an 'Open System Stored Value Card'
Placement - Layering - Integration.
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.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
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.

10. Wholesale Banking
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Banking services between merchant banks and other financial institutions.
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.
The FIU of the UK

11. FATF Recommendation 36
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Provide mutual legal assistance.

12. When was the Offshore Group of Banking Supervisors established? What was the impetus behind its establishment?
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

13. Why is 'Know Your Correspondent Bank' important?
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).
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.
Electronic transmissions of funds between financial institutions on behalf of themselves or their customers.
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.

14. What can result from on institution's disregard for the Basel Due Diligence Principle?
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.

15. (Credit card) Acquiring Bank
Real Estate - Insurance Transactions - Trade-Based Money Laundering.
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 criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Processes transactions for merchants who accept credit cards.

16. Nostro

17. FATF Sepcial Recommendation on Terrorist Financing -- SR Nine
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
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.
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.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.

18. What is a 'NCCT'?
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
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.
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.

19. Who are the parties involved in a trust?
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.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
Middle East and North Africa Financial Action Task Force

20. FATF Recommendation 23
Middle East and North Africa Financial Action Task Force
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
Financial institutions should have adequate supervision and regulation. Ensure no criminal element in position on control. Money transfer/exchangers should be registered and subjected to monitoring.

21. FATF Recommendation 40
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Countries should ensure that 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.

22. FATF's designated transactional threshold for Financial Insitutions is _____.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.

23. What is a Private Investment company (PIC)?
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.

24. EAG
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
EurAsian Group
An introducing broker-dealer with an exclusive written agreement with a Futures Commission Merchant (FCM) that obligates the FCM to assume responsibility for the introducing broker's performance.
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.

25. Cash Letter
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).
Financial institutions should have adequate supervision and regulation. Ensure no criminal element in position on control. Money transfer/exchangers should be registered and subjected to monitoring.

26. What is the aim of Joint Money Laundering Steering Group? (UK)
It was the first law in any country to make money laundering a crime.
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
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 promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws

27. Retail Banking
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
When residents are prevented from benefiting from a tax-regime or when non-residents are prevented from accessing the domestic market.
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
Typical mass-market banking where individual customers use local branches of larger commercial banks.

28. Scheme
As a financial institution service that is very vulnerable to money laundering.
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.
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.
Pouch activity.

29. The 'Art Loss Register'

30. How are 'Predicate Crimes' sometimes identified?

31. What are some of the AML dangers of casino junkets?
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
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.

32. Vital Service Providers (VSPs)
Solicits potential customers and issues the credit cards.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
People who help move the billions of dollars drug traffickers earn around the world.

33. (Credit Card) Issuing Bank
Placement - Layering - Integration.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Solicits potential customers and issues the credit cards.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.

34. A notary can issue a Apostille but it must be in a country that signed The Hague Convention (1961) and it must ___________. If the notary doesn't understand - find another one.

35. Who appoints a 'Federal Receiver' (US)?
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.
A US Federal Court
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
Money Laundering and Tax Evasion

36. Underwriting
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
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.

37. Example of use of an Apostille
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
Competent authorities should have powers of subpoena - search and seizure.
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.

38. What does FIU do beyond what FIU does?

39. Penny Stocks
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
Securities with very low marker price - volume and/or liquidity that are traded on a securities exchange or on the OTC markets. They tend to be more volatile than those on the major exchanges.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
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.

40. FATF Recommendation 22

41. Automated Sale
Financial institutions should have adequate supervision and regulation. Ensure no criminal element in position on control. Money transfer/exchangers should be registered and subjected to monitoring.
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.
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.

42. Convertible Preferred
Financial Action Task Force on Money Laundering in South America
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).
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.

43. Apostille

44. Commodity Trading Advisor
Foreign Corrupt Practices Act
Letters Rogatory
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.

45. What was the target of UN Security Council Resolution 1267?
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.
A Correspondent Banking Client who receives Corresponding Banking services from an institution and itself provides Correspondent Banking services to other financial institutions in the same currency as the account it maintains with the institution.
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization

46. 'Commission Rogatoire' known in English as?
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.
Foreign Corrupt Practices Act
Letters Rogatory
The US State Dept issues the report annually.

47. FATF Recommendation 25
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.

48. What is the primary use of a 'Mutual Legal Assistance Treaty'?
bear the mark 'APOSTILLE'
Open and Closed system
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.

49. FATF Recommendation 30
disrupt or adversely afftect the business of the bank.
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
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.

50. Commodity
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
Goods such as food - grains and metals that are usually traded in large amounts on a commodities exchange - usually through future contracts.