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Certified Anti Money Laundering Specialist Cams

Instructions:

Answer 50 questions in 15 minutes.
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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. Examples of White-collar crime
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
The FIU of Russia
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.
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.

2. What is private investment company also known as?
Stored Value Cards - Mobile Payments - Internet Payments.
The exempt accounts must be documented and the financial institution that secures the exemptions must still monitor their financial transactions.
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 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. GAFISUD
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.
Review customer files and conduct random sampling of accounts.
Financial Action Task Force on Money Laundering in South America
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.

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

5. Retail Banking
Typical mass-market banking where individual customers use local branches of larger commercial banks.
The UN Convention against Illicit Trafficking in Narcotic drugs and Pyshotropic substances [Adopted 12/88].
Provide the widest possible range of assistance to other countries' law enforcement and regulatory authorities for terrorist financing investigations.
It conducts investigations in support of a government's confiscation or seizure efforts.

6. What is the Wolfsberg group?
An association of global financial institutions that issues guidelines is such areas as correspondent banking - private banking - terrorist financing etc.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Provide mutual legal assistance.
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]

7. Characteristics of an 'Open System Stored Value Card'
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.
have in place compulsory currency reporting requirements.
Money Laundering - bribery - health care - tax - bankruptcy - securities or environmental frauds etc.
Type of foreign bank that is incorporated in the host country but is considered to be owned by a foreign parent bank. It only needs to operarted under the host country's regulations.

8. What is the goal of the Egmont group?

9. Operational risks in KYC context relate to...
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
Competent authorities should have powers of subpoena - search and seizure.
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
They are businesses such as ariplane - automobile and boat dealers - lawyers - jewelers - real estate brokers and others that are subjec to BSA regulations (US).

10. FCPA (US)
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
They can accrue value as the price of the underlying stock rises.
Countries should take immediate steps to become party to and implement fully the relevant international conventions related to AML and CFT efforts.
Foreign Corrupt Practices Act

11. Who appoints a 'Federal Receiver' (US)?
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
A US Federal Court
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
Reliable - independent source of documents - data or information.

12. Fraud
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
The FIU of Russia
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.

13. FATF Recommendation 26
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.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)
Countries should establish national centers to receive and disseminate AML/CFT information and have access to law enforcement and others.
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

14. A 'Cash Letter' can also be referred to as _____.
An electronic quotation system that displays quotes of many securities traded over the counter.
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]
Pouch activity.
2% - 5% ($590B - $1.5T)

15. EAG
To profit all kinds of markets by pursuing leveraging and other speculative investment practises thay may increase the risk of investment loss.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
Maintaining correspondent accoutnts at US Financial Institutions (USA Patriot Act)
EurAsian Group

16. FATF Recommendation 21
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
Should give special attention to relationships or transactions of people - companies or financial institutions from countries showing little regard for these Recommendations.
The US State Dept issues the report annually.
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.

17. FATF Recommendation 14
Foreign Corrupt Practices Act
With respect to STR/SAR reporting - financial institutions should be afforded safe harbor - yet barred from any unauthorized disclosures.
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
Countries should have a central authority to collect suspicious activity and international currency reports. Should have secure - computerized data base.

18. Examples of VSP's
Criminalize the financing of terrorism - terrorist acts and terrorist organisations.
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
Financial institutions should be required - by law or regulation - to report suspicious activity to their national FIU.
A detailed report on the narcotics trade and a lengthy narrative on the status of the related money laundering issues in most nations.

19. What tend to be the markings of Private Banking transactions?
Typical mass-market banking where individual customers use local branches of larger commercial banks.
Confidentiality - complex beneficial ownership arrangements - offshore investment vehicles - tax shelters and credit extension services.
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]
People who help move the billions of dollars drug traffickers earn around the world.

20. 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).
A prepaid card that is linked to the global funds network - which can allow for worldwide ATM with-drawls and purchases with many merchants.
Review customer files and conduct random sampling of accounts.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.

21. 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.
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.
tipped off that they are being investigated.
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).

22. FATF Recommendation 11
Intentional misrepresentation - concealment or omission of the truth for the purpose of deception or manipulation to ther detriment of a person or organization.
To take additional steps of examination and caution in identifying their customers and confirming that the customers' activities and funds are legitimate.
Letters Rogatory
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.

23. What does Financial Sector AssessmentProgram (FSAP) do?
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
Respondent banks may be used by other banks and customers to conduct transactions through a correspondent account.
The grantor (the owner of the property) - a beneficiary and the trustee (the manager of the property).
that appear to be linked

24. Cash Log

25. FATF Recommendation 10
Firm that contracts with issuing or acquiring banks to provide transaction processing and other credit-card related services for the banks.
Large companies often export their branded products at wholesale prices far below those at which those products are offered in that country.
bear the mark 'APOSTILLE'
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data

26. FATF Recommendation 27
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.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.
USD/EUR 15 -000 (Interpretive Note to Reommendations 5 - 12 and 16)

27. FATF Recommendation 34
A market is which securities are bought and sold outside of establisehd securities markets.
Because they are accounts through which funds are transferred and commingled without personally identifying the originator.
Countries should ensure that there is adequate - accurate and timely information on express trusts - including information on the settlor - trustee and beneficiaries.
Record retention: 5 years - data to recreate any individual transaction; 5 years after relationship ends - all customer identification data

28. Counter Party
Council of European committee of Experts on the Evaluation of AML measures and the Financing of Terrorism
Financial institutions should have AML/CFT programs that include approved policies - employee screenings & ongoing training and an audit function to test it all.
Countries should maintain comprehensive statistics to gauge effectiveness of their AML and CTF efforts.
The opposing part of a transaction or trade.

29. FATF Sepcial Recommendation on Terrorist Financing -- SR Six
It was the first law in any country to make money laundering a crime.
Attorneys - accountants - broker-dealers - communication and transportation providers - bankers and other financial service providers - concealment trap (hiding places) builders etc.
Impose AML requirements on alternative remittance systems.
Countries should designate law enforcement authorities with AML/CFT responsibilities and allow them special investigative techniques.

30. FATF Recommendation 37
Render mutual legal assistance notwithstanding the absence of dual criminality. Where dual criminality is required - classification should not be an issue.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
Countering the Financing of Terrorism (Counter Terrorist Financing).
Procedures used to determine the identities of the account holders of a respondent bank in a correspondent banking relationship.

31. Derivatives
Financial Action Task Force on Money Laundering in South America
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.
Financial instrument whose price is realted to the underlying commodity - currency - economic variable - financial istrument or security.
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.

32. Commodity Pool Operator
that appear to be linked
Operator or solicitor of funds for a commodity pool - which combines funds from members and trades futures or options contracts.
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.
Money Laundering and Tax Evasion

33. What does FIU do beyond what FIU does?

34. Basel committee's 'Customer Due Diligence for Banks' when verifying a unit's compliance with KYC policies and procedures - the home country supervisors or auditors should do what?
Confiscation
Through the use of experts - the program optimizes expert resources - reduces duplication of efforts and provides uniform advice in financial sector work.
An account that does not show activity other than the posting of interest or account maintenance fees.
Review customer files and conduct random sampling of accounts.

35. FATF Recommendation 30
Competent authorities should be provided with adequate financial - human and technological resources. Personnel should be of high integrity.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
By acquiring personal information about the victim (e.g: DOB - address - CC numbers) through stealth and misrepresentations.
Funds transfers - Shell Corporations - Contractual Transactions.

36. FATF Recommendation 36
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
An intelligence gathering law enforcement or regulatory body that receives financial information form covered financial institutions - businesses and persons in tis respective country.
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
Provide mutual legal assistance.

37. Wholesale Banking
weakness in the implementation of bank programs - ineffective control procedures and failure to practice due diligence.
Banking services between merchant banks and other financial institutions.
Confiscation
PEP accounts need to be identified - approved by senior management - and have ongoing enhanced monitoring. Sources of Wealth and funds must also be established.

38. 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...
that appear to be linked
To allow for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial assistance in the respective countries.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
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.

39. 'Coucil of Europe Convention on Laundering - Search - Seizure and Confiscation of the Proceeds from Crime' is known for what?
Countries should ensure that knowledge can be inferred. Additionally - legal persons should be subject to theses laws.
Extending the offense of money laundering to include money laundering associated with all serious offenses - not only with drug trafficking [Adopted 9/90].
A federal regulator in the US - responsible for auditing risk and compliance measuers of federally chartered banks.
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.

40. FATF Recommendation 23
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.
A contemporaneous record of the steps - observations - evidence - findings and decisions of an investigation.
General recommendations for client acceptance - updating client files - practices when identifying unusual or suspicious activity - monitoring - control responsibilities - reporting - education and records retention.
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.

41. Many jurisdictions have legislation to ensure that suspects are not ____?
The US State Dept issues the report annually.
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.
2% - 5% ($590B - $1.5T)
tipped off that they are being investigated.

42. How does 'Product Diversion' work?
The world's largest private DB of stolen art.
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.
Futures contracts - forwards - swaps or options.
A merchant submits a saled transaction on his personal bankcard account to ontain cash advances through their business.

43. FATF Recommendation 12
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.
The CDD and record-keeping requirements (of Rec 5 - 6 - 8 & 11) apply to non-financial businesses and professions.
Countries should recognize money laundering as an extraditable offense.
Ensure that entities - in particular non-profit organizations - cannot be misused to finance terrorism.

44. FATF Recommendation 38
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.
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).
Under what authority? Among other things - it regulates brokers and dealers - under authority of the Securities Exchange Act of 1934.
The International Monetary Fund (IMF) and the world bank conduct the joint program.

45. Affidavit
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.
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.
Review customer files and conduct random sampling of accounts.
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.

46. Guaranteed Introducing Broker

47. Apostille

48. What is a 'Trust'?
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.
Because it represents funds drawn on the account of a financial institution and not on a particular individual.
Normally seen as non-violent or involving 'business-related' schemes rather than violent or threat or violence crimes.
Ad interbank transmittal form - resembling a deposit slip - used to accompany cash and cash equivalent items sent from one bank to another.

49. FATF Recommendation 1
Adopted in 1999 - it imposed sanctions on Taliban-controlled Afghanistan for its support of Osama Bin Laden and the Al-Qaeda organization
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.
Entities such as American Express - Master Card and VISA - which license member banks to issue bankcards - authorize merchants to accept those cards - or both.
Countries should criminalize money laundering and apply it to all serious offenses - even if committed in another country.

50. What does an Extradition Treaty specify?
October 1980. The instigation of Basel Committee on Banking supervision (with which the group maintains close contact).
The terms of such exchanges - the persons subject to being exchanged - and the crimes for which exchanges will be permitted.
An order from government authority requiring a financial institution to provide transaction information on a suspect account for a specified period of time.
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