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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. OCC Office of the Comptroller of the Currency
Banking services between merchant banks and other financial institutions.
Represents a profession and is made up of member professionals; has a role in regulating the persons who are qualified to enter and who practise the profession; performs cetain supervisory or monitoring type function.
The world's largest private DB of stolen art.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.

2. (Credit Card) Issuing Bank
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Solicits potential customers and issues the credit cards.

3. What is meant by 'Know Your Correspondent Bank'?

4. What is a 'NCCT'?
Real Estate - Insurance Transactions - Trade-Based Money Laundering.
Intergovernmental Action Group against Money Laundering in Africa
Reliable - independent source of documents - data or information.
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.

5. FATF Recommendation 17
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
have in place compulsory currency reporting requirements.
disrupt or adversely afftect the business of the bank.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.

6. GAFISUD
Financial Action Task Force on Money Laundering in South America
Strengthen customer identification measures in iternational and domestic wire transfers.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.

7. How do 'Hedge Funds' operate?

8. What is the goal of FSAP?
Impose AML requirements on alternative remittance systems.
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.
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
Banking services between merchant banks and other financial institutions.

9. UK courts view on 'Suspicion'
Harmful or Preferrential Tax Regimes.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
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.
Review customer files and conduct random sampling of accounts.

10. MENAFATF
Middle East and North Africa Financial Action Task Force
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
Direct money of Criminal A is sent to foreign bank account of company B. Investment company C is formed as A's country. A is appointed as director of C. C borrows money from B and buys building which is rented to 3rd parties. with rent - C pays off B
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.

11. What does Financial Sector AssessmentProgram (FSAP) do?
A trust clearly created by the settlor - usually in the form of a document - such as a written deed or trust.
The FIU of Russia
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.

12. FATF Recommendation 30
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
Direct or indirect advisor on buying and selling futures or commodity options.
that appear to be linked
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.

13. FATF Recommendation 26
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.

14. USA Patriot Act Section 312 'Offshore Bank'
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.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
no regulatory power or function

15. Arrest Warrant
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.
a chain-referral scheme.
A record that financial institutions must retain for each cash sale of bank checks - drafts - money orders - cashier's checks and traveller's checks between $3 -000 and $10 -000.
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.

16. Dormant Account
An account that does not show activity other than the posting of interest or account maintenance fees.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.
The sale of a stock that the investor does not own. To do so - a securities intermediary 'loans' the stock to the investor - which comes from the intermediary's own inventory - another client's margin account or another intermediary.

17. 'Competent Authorities' refers to _____.
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
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.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
Terrorism and Terrorist Financing

18. Who appoints a 'Federal Receiver' (US)?
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
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.
A US Federal Court
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.

19. FATF Recommendation 34
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
Assess any international correspondent's bank nature - ownership - management - reputation - supervision and AML & Terrorist Financing controls. Also. document relationship responsibilities.

20. EAG
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
Direct or indirect advisor on buying and selling futures or commodity options.
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
EurAsian Group

21. Cash Equivalent

22. What was the target of UN Security Council Resolution 1373?
Terrorism and Terrorist Financing
www.artloss.com
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.
Direct or indirect advisor on buying and selling futures or commodity options.

23. Variable Annuity
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
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.
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 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.

24. FATF Recommendation 9
EurAsian Group
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.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Open and Closed system

25. What normal business practise makes 'Product Division' possible?
Real Estate - Insurance Transactions - Trade-Based Money Laundering.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
Person who - for compensation - provides advice on securities and investments and manages client assets.

26. OTC markets Over-The-Counter
They can accrue value as the price of the underlying stock rises.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
A market is which securities are bought and sold outside of establisehd securities markets.
Real Estate - Insurance Transactions - Trade-Based Money Laundering.

27. How is 'Legal Risk' defined by the 2001 Basel Due Diligence Principles?
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.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
The FIU of the UK
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.

28. Underwriting
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.
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.
Confiscation
Provide mutual legal assistance.

29. FATF Recommendation 33
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
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.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.

30. Why is it imperative to have a strong Know Your Employee program?
In many major money laundering operations - it is not unusual to find a complicit employee in financial institution.
As a financial institution service that is very vulnerable to money laundering.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
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.

31. FATF Recommendation 39
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.
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.
Countries should recognize money laundering as an extraditable offense.

32. FATF Recommendation 31
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
bear the mark 'APOSTILLE'
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.

33. Convertible Bond
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.
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]
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.
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.

34. Convertible Preferred
Letters Rogatory
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.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.

35. (Credit Card) Third-Party processor
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
tipped off that they are being investigated.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).

36. Who appear to be predominant users of hawalas and other alternative remittance systems?
Expatriates sending money back to their home country or by other individuals sending money abroad.
EurAsian Group
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.

37. Free Look Period
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
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.
A contractual provision that allows the contract owner the right to return the contract within a specified period for a refund.
Financial institutions should NOT keep any anonymous or fictionally named accounts - plus they should undertake customer due diligence measures.

38. FATF Sepcial Recommendation on Terrorist Financing -- SR Nine
It conducts investigations in support of a government's confiscation or seizure efforts.
Strengthen customer identification measures in iternational and domestic wire transfers.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.

39. FATF Recommendation 1
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Designated non-financial businesses and professions should be subject to regulatory and supervisory measures. Casinos should prevent criminal ownership - operations or management.
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
have in place compulsory currency reporting requirements.

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

41. FATF Recommendation 20
Countries should apply Recommendations to any business or profession that poses a money laundering or terrorist financing risk.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
Review customer files and conduct random sampling of accounts.
no regulatory power or function

42. Commodity Pool Operator
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
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.
EurAsian Group
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.

43. FATF Recommendation 25
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.

44. US law prohibhits Foriegn Shell Banks from ____?
Direct or indirect advisor on buying and selling futures or commodity options.
Strengthen customer identification measures in iternational and domestic wire transfers.
Person who - for compensation - provides advice on securities and investments and manages client assets.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)

45. Credit Card Associations
The International Monetary Fund (IMF) and the world bank conduct the joint program.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.

46. As considered by UN and OECD - these are jurisdictions that have no or low tax rates - and do not attract real business or foreign investment
Harmful or Preferrential Tax Regimes.
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.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
A record that financial institutions must retain for each cash sale of bank checks - drafts - money orders - cashier's checks and traveller's checks between $3 -000 and $10 -000.

47. What is a Private Investment company (PIC)?
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
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.
A corporation - often established in an offshore jurisdiction with tight secrecy laws to protect the financial privacy of its owners.
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.

48. Investigative Log
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Countries should have effective criminal - civil and administrative sanctions for money laundering or terrorist financing violations.
The US State Dept issues the report annually.
A US Federal Court

49. FATF Recommendation 14
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).
Terrorism and Terrorist Financing
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
Open and Closed system

50. FATF Recommendation 4
Countries should ensure that secrecy laws do NOT inhibit implementation of these Recommendations.
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.
The US State Dept issues the report annually.
Review customer files and conduct random sampling of accounts.