Test your basic knowledge |

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. The Palemo Convention
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Placement - Layering - Integration.

2. Investment Adviser
Harmful or Preferrential Tax Regimes.
Person who - for compensation - provides advice on securities and investments and manages client assets.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
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.

3. What criterion does the US need to enforce its 'Extraterritorial Reach'?

4. Convertible Preferred
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
It analyzes and processes information and disseminates it to appropriate government authorities in support of AML efforts and financial crime investigations.

5. Dematerialization of Securities

6. 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.
Penny Stocks
EurAsian Group
All admininstrative and law enforcemnt authorities concerned wiht combating money laundering and terrorist financing - including the FIU and supervisors.

7. What was the target of UN Security Council Resolution 1373?
Take immediate steps to ratify and implement the UN instruments.
Terrorism and Terrorist Financing
Non-Coperative countries and Territories. Country or territory that has been designated by the FATF as non-cooperative with international AML principles and procedures.
2% - 5% ($590B - $1.5T)

8. FATF Recommendation 33
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.
Combines funds from various members and users them to trade in futures or options contracts.
Countries should ensure that there is adequate - accurate and timely information on the beneficial ownership and control of legal persons.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.

9. FATF Recommendation 15
Impose AML requirements on alternative remittance systems.
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
People who help move the billions of dollars drug traffickers earn around the world.

10. What was the target of UN Security Council Resolution 1267?
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
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.
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.
Helps to identify financial system strengths and vulnerabilities and to reduce the potential for crisis.

11. What do boiler room salespeople typically sell?
It conducts investigations in support of a government's confiscation or seizure efforts.
Letters Rogatory
Penny Stocks
Reliable - independent source of documents - data or information.

12. OCC Office of the Comptroller of the Currency
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
www.artloss.com
that appear to be linked
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.

13. Automated Sale
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.
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
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.

14. Cash Equivalent

15. What is the primary use of a 'Mutual Legal Assistance Treaty'?
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.
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
disrupt or adversely afftect the business of the bank.
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.

16. What is the FCPA primarily known for?
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).
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
A fund - offered by an investment company - that offers shares while investing the capital in diversified securities of other companies.
Casinos - real estate agents - precious metal/stone dealers - lawyers - notaries - accountants and trust & company service providers.

17. What does Financial Sector AssessmentProgram (FSAP) do?
The transfer of physical - hard-copy security certificates to book entry credits of a security holder's interest.
Countries should recognize money laundering as an extraditable offense.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Direct or indirect advisor on buying and selling futures or commodity options.

18. What is a Financial Intelligence Unit?
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
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.
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.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.

19. 'Commission Rogatoire' known in English as?
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.
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.
Letters Rogatory

20. The Vienns Convention
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.
Money Laundering and Tax Evasion
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
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.

21. Who appoints a 'Federal Receiver' (US)?
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
disrupt or adversely afftect the business of the bank.
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 US Federal Court

22. FATF Recommendation 1
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.
Preferred stocks that includes an option for the holder to convert it into common stock at a specified covnersion rate.
They can accrue value as the price of the underlying stock rises.

23. Three stages of money laundering
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
The UN Convention against Transnational Organized Crime [Adopted 12/2000].
Transportation/transfer of funds (even clean) to/from the US - if done to promote unlawful activity - or with knowledge that the funds are illicit - or to conceal/disguise the nature - location - source - ownership - etc. of funds - or to avoid feder
Placement - Layering - Integration.

24. Apostille

25. What do 'Hedge Funds' attempt to do?
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.
It was the first law in any country to make money laundering a crime.
The principal US money laundering law can apply to a non-US citizen if the 'conduct' occurs 'in part' of the US.
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.

26. FATF Recommendation 6
An electronic quotation system that displays quotes of many securities traded over the counter.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.
Any item that a bank is wiling to accept for immediate - provisional credit to a customer's account - instantly increasing the account's balance.
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.

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

28. FATF Recommendation 8
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
Terrorism and Terrorist Financing
As a key tool in detecting suspicious or money laundering activity - it is important because correspondent accounts are often used as conduits to launder criminal proceeds in international settings.
Financial institutions should pay to any threats from new or developing technologies - especially with non f2f relationships.

29. A public perception that a bank is not able to manage its operational risk effectively can...
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
disrupt or adversely afftect the business of the bank.
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.
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. OTC markets Over-The-Counter
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
A market is which securities are bought and sold outside of establisehd securities markets.
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].

31. FATF Sepcial Recommendation on Terrorist Financing -- SR Nine
Middle East and North Africa Financial Action Task Force
Have measures in place to detect the physical corss-border transportation of currency and bearer negotiable instruments - including a declaration system.
They can accrue value as the price of the underlying stock rises.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.

32. What normal business practise makes 'Product Division' possible?
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
USD/EUR 3 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

33. FATF Sepcial Recommendation on Terrorist Financing -- SR Eight
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.
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.
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.
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.

34. Arrest Warrant
Countries should ensure that their competent authorities provide the widest possible range of international cooperation to their foreign counterparts.
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.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
Countering the Financing of Terrorism (Counter Terrorist Financing).

35. Foriegn Shell Banks are vehicles for ______ & ______?
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.
Money Laundering and Tax Evasion
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
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.

36. FATF Recommendation 35
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
Freeze and confiscate terrorist assets.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.

37. What can result from on institution's disregard for the Basel Due Diligence Principle?
Customer makes payments on account with bad checks - then takes cash advances before they clear - thereby expanding his credit.
The financial institution can become subject to lawsuits from the failure to observe mandatory KYC standards or from the failure to practise due diligence.
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).
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.

38. When was the Offshore Group of Banking Supervisors established? What was the impetus behind its establishment?
A firm or person that solicits or accepts orders on futures contracts or commodity options and accepts funds for their execution.
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
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.
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws

39. In what country is the Egmont Group Secretariat now located?
To promulgate good practices in countering money laundering and to give practical assistance in interpreting the UK Money Laundering Regulations and laws
Canada
Supervisors should have powers to monitor and ensure compliance - including the ability to compel production of information and to impose sanctions.
The right - but not the obligation - to buy or sell a set amount of something - such as a share or commodity - at a set price after a set expiration date.

40. What is the Serious Organised Crime Agency (SOCA)?
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]
The FIU of the UK
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
Person who - for compensation - provides advice on securities and investments and manages client assets.

41. May a shell bank maintain a correspondent account with a US bank?
Financial Action Task Force
No.
The FIU of Russia
Competent authorities should have powers of subpoena - search and seizure.

42. Moneyval
An arrangement whereby an investor pays for part of a securities purchase and borrows the rest from a securities intermediary.
The US State Dept issues the report annually.
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
Provide mutual legal assistance.

43. FATF Recommendation 3
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
Countries should enable their competent authorities to freeze - seize and confiscate laundered property or proceeds.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.

44. FATF Recommendation 31
EurAsian Group
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.
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.
Countries should ensure policy makers - the FIU - law enforcement and supervisors have effective mechanisms to enable cooperation.

45. Reverse Flip

46. FATF Recommendation 10
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data
Market participants intentionally restrict a security's liquidity. May lead to increased profits when the security's price rises due to the lack of 'supply'.
Stored Value Cards - Mobile Payments - Internet Payments.
a Sr Management level

47. Agent (Insurance Industry)
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
Placement - Layering - Integration.
Transportation/transfer of funds (even clean) to/from the US - if done to promote unlawful activity - or with knowledge that the funds are illicit - or to conceal/disguise the nature - location - source - ownership - etc. of funds - or to avoid feder
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.

48. Why do companies export their goods at prices far below those in their home country?
To create new overseas markets - dispose of excess goods - or otherwise recover their costs.
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.
Competent authorities should provide guidelines in applying national AML/CFT measures - especially for detecting and reporting suspicious activity.
Berlin- based - non-governmental organization with goal of improving government accountability and curbing national and international corruption.

49. 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
Futures contracts - forwards - swaps or options.
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
Harmful or Preferrential Tax Regimes.
Penny Stocks

50. What must a financial institution do if they have 'Exempt Accounts'?
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
Foreign Corrupt Practices Act
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).
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.