Get New 2025 Valid Practice To your CAMS Exam (Updated 865 Questions) [Q195-Q211]

Q195. The anti-money laundering compliance officer for a small money transmitter has several agent locations in the same geographic area in the United States. The customers are immigrants from Country A and the majority of the funds are remitted to Country A.
In a meeting with one of the agents, it is recently discovered that two new customers have been coming in three times a week and sending funds to the same recipient in Country B. Each cash transaction always totals exactly $8,000.
What should alert the agent to possible money laundering activity by the two customers?

They remit funds to the same person

They have been coming in three times a week

It is unusual for customers to remit to Country B

Each of their transactions is just below the cash reporting threshold

Q196. In relationship to life insurance business, the third European Directive states that Member States may allow the identity verification of the beneficiary under the policy after the business relationship has been established, but before which events?

At or before a premium payment has been accepted for the policy purchased

At or before the policy is issued to the beneficiary by the insurance company

At or before the time of payout or before the beneficiary intends to exercise rights vested under the policy

At or before 30 days of the relationship being established under the policy

Q197. Which three methods are commonly used by an accountant to launder money? (Choose three.)

Representing a client court

Understanding income to take a tax loss

Overstating income to hide excess cash

Acting as a conduit for transferring cash between accounts

Acting as a designee for someone who wishes to hide their identity

Q198. What is one of the indicia of a Black Market Peso Exchange?

A wire transfer from a third party not connected with a transaction

A large deposit of pesos converted into U.S. dollars

A transfer of U.S. dollars to Central or South America to be converted into pesos

An illegal entity that exchanges pesos for U.S. dollars for illegal immigrants

Q199. the Financing of Terrorism (CFT)]
Which is an objective of the Financial Action Task Force (FATF)-Style Regional Bodies (FSRBs)?

To issue their own recommendations, considering local typologies, ignoring the FATF 40 recommendations

To work in parallel with FATF by operating on the basis of (mutual, joint, or common) recognition of their work

To enforce implementation of the FATF recommendations amongst its member countries

To work independently from FATF and to be closely involved in improving law enforcement outcomes in their regions

Q200. A typical red flag regarding potential money laundering in connection with an art purchase occurs when a customer:

buys a painting as an anonymous bidder and provides the source of wealth.

asks to pay in installments and pays from two differently named accounts.

asks to pay a large amount in cash without a comprehensible reason.

pays more at an auction for a painting than the estimated maximum price.

Q201. A branch manager for a small community bank has a new customer who deposits for EUR 50,000 checks into one account. Shortly thereafter, the customer goes to another branch and asks to transfer all but EUR 1,500 to three accounts in different foreign jurisdictions.
Which suspicious activity should be the focus of the suspicious transaction report?

The customer opened the account with four large checks

The customer goes to a different branch to make this transaction

The customer transfers almost all of the funds out of the account

The customer asks to transfer funds to accounts in three different foreign jurisdictions

Q202. Which method is used to launder money via wire remittances sent through a bureau de change or money services business?

A customer in country A makes a weekly small wire transfer to the bank account of an individual in country

A customer in country A makes frequent wire transfers to a single customer in country B that are slightly under the legal reporting threshold.

A large number of wire transfers are sent from a large number of senders in country A to a large number of recipients in country B during the period of December 1 to December 15.

A customer in country A receives four small wire transfers from four different individuals located in country B on December 21. The aggregate of the wire transfers falls below the legal reporting threshold.

Q203. Which three stages of money laundering are on-line banking vulnerable to?

Placement

Layering

Integration

Structuring

Q204. the Financing of Terrorism (CFT)]
A compliance officer is conducting a review of the automated transaction monitoring system. What would be most likely to result in a change in the monitoring system parameters?

The local paper runs stories that sully the institution’s reputation in the marketplace

Law enforcement issues a subpoena for a particular customer’s account records

The national Financial intelligence Unit issues new risk indicators

The institution’s creditworthiness thresholds change

An automated transaction monitoring system is a tool that analyzes transactions and customer behavior for signs of money laundering or other financial crimes, and generates alerts when suspicious or unusual activity is detected. The system relies on a set of rules and parameters that define what constitutes normal and abnormal transactions, based on the risk profile and business nature of the financial institution or business.
These rules and parameters need to be periodically reviewed and updated to ensure that they are effective and compliant with the latest regulations and best practices.
One of the factors that would most likely result in a change in the monitoring system parameters is when the national Financial intelligence Unit (FIU) issues new risk indicators. The FIU is a central authority that collects, analyzes, and disseminates financial intelligence related to money laundering, terrorist financing, and other financial crimes. The FIU also provides guidance and feedback to financial institutions and businesses on how to comply with their anti-money laundering (AML) obligations and improve their transaction monitoring systems. The FIU may issue new risk indicators based on its analysis of emerging trends, typologies, and threats in the financial sector, or based on international standards and recommendations.
These risk indicators are intended to help financial institutions and businesses identify and report suspicious transactions more effectively and efficiently.
Therefore, when the FIU issues new risk indicators, the financial institution or business should review its existing monitoring system parameters and adjust them accordingly to reflect the new risks and scenarios. For example, the FIU may issue new risk indicators related to the use of cryptocurrencies, virtual assets, or online platforms for money laundering or terrorist financing. In that case, the financial institution or business should update its monitoring system parameters to include new rules, thresholds, or patterns that capture these activities and generate alerts for further investigation.
:
1: The Complete Guide to Transaction Monitoring: Everything to Know
2: AML Scenarios: Transaction Monitoring Challenges
3: Setting AML Transaction Monitoring Thresholds
4: Automated Transaction Monitoring – Considerations for System Implementation
5: ACAMS (2020). CAMS Certification Package (6th Edition)

Q205. Upon filing a suspicious transaction report, which of the following elements should be the highest anti-money laundering priority in making the decision to keep the account open?

Financial impact on the institution if the account is closed.

Procedures to ascertain the potential risk to the organization.

Additional Administrative costs of monitoring the account.

Total number of accounts the institution closed in the last month.

Q206. What are three potential issues for foreign financial institutions maintaining correspondent accounts with U.S.
banks under the Patriot Act? Choose 3 answers

Cancellation of correspondent banking relationships

Forfeiture of funds in a U.S. interbank account

Prohibition of correspondent accounts for shell banks

U.S. residents maintaining private banking accounts

The Patriot Act, enacted in 2001, introduced several provisions to enhance the anti-money laundering and counter-terrorist financing (AML/CFT) measures for U.S. banks and their foreign correspondent relationships.
Some of the potential issues for foreign financial institutions (FFIs) maintaining correspondent accounts with
U.S. banks under the Patriot Act are:
* Cancellation of correspondent banking relationships: The Patriot Act requires U.S. banks to conduct due diligence and enhanced due diligence on their foreign correspondent accounts, and to terminate any account that poses a significant risk of money laundering or terrorist financing. This may result in the cancellation of correspondent banking relationships with FFIs that do not meet the U.S. standards or cooperate with the U.S. authorities. The loss of correspondent banking relationships may affect the FFIs’ ability to access the U.S. financial system and provide services to their customers.
* Forfeiture of funds in a U.S. interbank account: The Patriot Act authorizes the U.S. government to seize and forfeit any funds in a U.S. interbank account that are involved in or traceable to money laundering or terrorist financing activities. This means that FFIs may face the riskof losing their funds in a U.S.
interbank account if they or their customers are suspected or accused of engaging in illicit activities.
The forfeiture of funds may have significant financial and reputational consequences for the FFIs and their customers.
* Prohibition of correspondent accounts for shell banks: The Patriot Act prohibits U.S. banks from establishing or maintaining correspondent accounts for shell banks, which are banks that have no physical presence in any country and are not affiliated with a regulated financial group. This means that FFIs that are shell banks or have relationships with shell banks cannot access the U.S. financial system through correspondent accounts. The prohibition of correspondent accounts for shell banks aims to prevent the use of shell banks as vehicles for money laundering and terrorist financing.
CAMS Study Guide, 6th Edition, Chapter 4: Compliance Standards for Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT), pp. 81-841 USA PATRIOT Act, Title III: International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001, Sections 312, 319, and 3132 Wolfsberg Anti-Money Laundering Principles for Correspondent Banking, October 2014, pp. 3-43 Reference:http://www.ffiec.gov/bsa_aml_infobase/pages_manual/olm_027.htm

Q207. What does the Basel Committee’s Customer Due Diligence for Banks paper suggest that a bank needs to have in place when establishing an account for a corporate business entity?

An understanding of the structure of the company

A policy requiring all identified beneficial owners to undergo a national police check

A process to ensure that the approval of senior management is obtained prior to opening the account

A fee structure that reflects the banks’ costs in monitoring the risks associated with entity’s business activities

Q208. According to Basel Committee on Banking Supervision’s Customer Due Diligence for Banks, which of the following should provide an evaluation of a bank’s policies and procedures independent from its management?

The credit risk department

The Board

A peer institution

The compliance function

Q209. A non-U.S. bank asks its U.S. correspondent whether there is risk of having funds seized in their correspondent account if a customer is involved in a predicate offense.The correspondent bank’s reply should be,

“No, only U.S. accounts for U.S. citizens can be seized and forfeited by the competent authority.”

“No, only correspondent accounts of U.S. banks can be seized and forfeited by govern-ment agencies.”

“Yes, if it is suspected that money laundering has occurred solely in the U.S.”

“Yes, also if the customer’s account is used in a country other than the U.S. by suspected money launderers.”

Q210. A bank maintains a number of United States (U.S.) dollar correspondent accounts for foreign financial institutions. Upon a routine review of a U.S. dollar correspondent account owned by Foreign Bank A, a number of transactions appear to have been originated by Foreign Bank B outside the expected activity for this account. These transactions appear suspicious and a suspicious transaction report was filed by the compliance officer.
Which step should the compliance officer take?

File a report with the appropriate tax authorities in the jurisdictions of Foreign Bank A and Foreign Bank B

Notify senior management of the money laundering risks by allowing Foreign Bank A to maintain its U.S. dollar correspondent account

Notify Foreign Bank A of the discovery and seek documentation supporting Foreign Bank A was collusive and a willing partner with Foreign Bank B in the activity

Notify other U.S. financial institutions who maintain U.S. dollar correspondent accounts for Foreign Bank A and Foreign Bank B in an effort to shut down the activity

Q211. What do Financial Action Task Force (FATF)-style regional bodies do for their members to help combat money laundering and terrorist financing?

They provide technical assistance to members in implementing FATF recommendations

They assist member countries in penalizing entities that violate FATF standards and recommendations

They work with members on areas of concern outside of anti-money laundering and terrorist financing

They supervise member country financial institutions relating to anti-money laundering and terrorist financing