[PDF]CAMS Certified Anti-Money Laundering Specialist Updated Dumps

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Exam : CAMS


Title : Certified Anti-Money
Laundering Specialist


https://www.passcert.com/CAMS.html


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1.What does designing a country as being of “prime money laundering concern” allow the U.S.
government to do?

A. Obtain transactional information from U.S.-owned subsidiary banks located outside the U.S.

B. Close some or all correspondent or payable-through accounts

C. Ensure the inclusion of that country onto FATF’s Non-Cooperative Country and Territory list

D. Ensure the inclusion of that country into the office of Foreign Asset Control country sanctions programs
Answer: C


2.An employee hears a colleague on the telephone with a customer giving advice on how to ensure that a
suspicious transaction report will not be filed as a result of a future transaction.

What action should the employee take?

A. Report the conversation to the local police

B. Report the conversation to the compliance officer

C. Tell the colleague that it is against policy to give such advice

D. Ignore the situation because the colleague is the relationship manager for that customer

Answer: C


3.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?

A. The customer opened the account with four large checks

B. The customer goes to a different branch to make this transaction

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

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

Answer: D


4.How can a financial institution verify the nature and purpose of a business and its legitimacy?

A. By reviewing a copy of the corporation’s latest audited reports and accounts

B. By undertaking a company search or other commercial inquires to see that the institution has not been,
or is not in the process of being dissolved of terminated

C. By reviewing the company’s website

D. By using an independent information verification process, such as by accessing public and private
databases

Answer: D


5.Which three procedures should a compliance officer looking to revise an institution’s CTF efforts include
in accordance with the Wolfsberg Group’s Statement on the Suppression of the Financing of Terrorism?
A. Consulting applicable lists and taking appropriate actions to determine if customers appear on such
lists

B. Reporting matches from lists of known or suspected terrorists to relevant authorities

C. Maintaining customer information to facilitate timely retrieval of such information

D. Reviewing only original identification documents when verifying customers

Answer: A,B,C


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Explanation:

UNUSUAL CUSTOMER IDENTIFICATION CIRCUMSTANCES

e Customer furnishes unusual or suspicious identification documents or declines to produce originals for
verification."


6.Which method is used to launder money in casinos?

A. Purchase chips with cash and play at a table

B. Purchase chips with cash and redeem for cash

C. Purchase chips with cash and redeem for a check

D. Purchase chips with cash and sell to another person for cash
Answer: C


7.A businessman requests a European private bank to open a numbered or alternate name account.
According to the Basel Committee on Banking Supervision principles, which of the following is the most
important question the banker should ask?

A. Who will control the account?

B. Who will inherit the proceeds in the event of the businessman's death?

C. How much money will be deposited into the account?

D. What account-opening date should | record'!'

Answer: B


8.Why are Money Services Business (MSBs) frequently accused of being high risk for money laundering?
A. AMSB should be used to hide money from a regulated entity

B. MSBs generally charge lower commission rates than banks charge making them attractive to criminals
C. MSBs can route funds to more high risk countries than banks

D. MSBs are subject to regulatory scrutiny which varies greatly from country to country

Answer: B


9.A bank maintains a relationship with a customer who owns a small bakery business.

Which customer action indicates potential money laundering?

A. The customer continually makes regular cash deposits

B. The customer has multiple bank accounts at several locations

C. The customer purchased property insurance that is twice the value of the business

D. The customer recently wired a large amount to a foreign jurisdiction where family is located
Answer: D


10.Which requirement is included in the Fourth European Union Directive on money laundering?

A. It requires obliged entities to consider politically exposed persons as high risk for life

B. It requires obliged entities to conduct enhanced due diligence on all prepaid card holders

C. It requires member countries to maintain registries of the beneficial owners of legal entities

D. It requires member states to enact economic sanctions against countries that do not cooperate with
Financial Action Task Force recommendations

Answer: C

Explanation:


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Reference: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32018L0843&from=EN


11.A suspicious transaction report filed on a car dealer structuring deposits initiates a criminal
investigation. The dealer changes branches and begins placing transactions with a frontline
employee to whom the dealer has given numerous gifts.

This employee handles all of the dealer's structured deposits and does not report the suspicious activity
internally.

The competent authority has advised the anti-money laundering specialist to avoid tipping off the
employee until the investigation is finalized.

What action should the specialist take next?

A. Recommend the immediate termination of the employee.

B. Advise that the dealer's accounts should be closed.

C. Consult with senior management and the legal advisor.

D. Inform the institution's regulatory agency of the situation.

Answer: D


12.What are two requirements with respect to supporting documentation that is used to identify potentially
suspicious activity, according to Financial Action Task Force? (Choose two.)

A. It must be retained for at least five years

B. It must be retained for at least seven years

C. It must be kept in a manner so that it can be provided promptly

D. It must only be released to the government through a subpoena process

Answer: A,C

Explanation:

Reference:

https://www. fatf-gafi.org/media/fatf/documents/recommendations/pdfs/FATF %20Recommendations%202
012.pdf


13.In general, what is an element that a financial institution or business does not have to specifically
address in an anti-money laundering program?

A. Asystem of internal policies, procedures and controls

B. A designated compliance officer with day-to-day oversight over the AML program

C. An ongoing employee training program

D. A description of its OFAC program to address government watch list screening

Answer: D


14.A politically exposed person (PEP) maintains an account at a bank. Last month a money laundering
analyst filed a suspicious transaction report about unusual wire deposits originated by unknown
individuals in the home country of the official.

To whom should this situation be escalated?

A. The board of directors

B. The line of business executive

C. The bank’s anti-money laundering officer

D. The Financial Action Task Force’s PEP Hotline


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Answer: C


15.The branch manager notices that a number of customers come in weekly and always use the same
teller to process their deposits. The manager notices that the customers and the teller, who are from the
same ethnic group, are speaking in a foreign language and every once in a while the customers from local
ethnic restaurants will bring the teller lunch. The commercial customers that visit the teller generally
deposit the same amount of cash each time they come in.

How should the branch manager respond to this activity?

A. Transfer the teller to another branch

B. Conduct further investigation before taking any other action

C. Encourage the teller to bring in more business from the ethnic community

D. Suggest to the teller to send the customers to other tellers to avoid the opportunity for collusion
Answer: B


16.When should the anti-money laundering risk assessment be updated?

A. Every two years

B. After a merger or acquisition

C. When the board of directors changes

D. When instructed to by the Financial Action Task Force

Answer: B

Explanation:

Evaluating the risk scoring model and conducting the risk assessment itself may need to be performed
annually, every eighteen to twenty-four months, before the launch of a new product, or when an
acquisition of another financial institution occurs.

Reference:
https:/Awww.wolfsberg-principles.com/sites/default/files/wb/pdfs/faqs/17.%20Wolfsberg-Risk-Assessment
-FAQs-2015.pdf (10)


17.A compliance officer at an insurance company has been reviewing the transaction activity of several
clients.

Which transaction is considered a red flag for potential money laundering?

A. A client paid the quarterly life insurance premium using money orders from two different banks.

B. A client from a high-risk jurisdiction recently purchased property insurance for a real-estate
development.

C. Acorporation owns several affiliates and recently opened separate group life insurance policies for
each of the affiliates.

D. A client established a $100,000 charitable annuity with a non-profit organization that provides health
and safety assistance internationally.

Answer: A

Explanation:

https://www.naic.org/documents/committees_d_antifraud_meetingcc_faqsinsurance_ 10310 5.pdf


18.When creating an anti-money laundering program for a foreign bank with branches in the United
States, which of the following are included among the four minimum elements required under the USA


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PATRIOT Act?

1. The development of a Know Your Customer program.
2. An ongoing employee training program.

3. The designation of a compliance officer.

4. An independent audit function to test the program.

A. 1, 2, and 3 only

B. 1, 2, and 4 only

C. 1, 3, and 4 only

D. 2, 3, and 4 only

Answer: B


19.What is the currency threshold under the European Union Fourth Anti-Money Laundering Directive?
A. 3,000 Euros

B. 5,000 Euros

C. 10,000 Euros

D. 15,000 Euros

Answer: C

Explanation:

Reference: https:/Awww.acams.org/aml-resources/eu-fourth-aml-directive/


20.An offshore company is owned by four equal partners that reside in separate jurisdictions. One partner
presents an authenticated power of attorney apparently executed by the remaining three partners in his
favor and requests that a bank account be opened on behalf of all partners. He needs this done quickly
because there is a large deposit pending. The account-opening officer contacts the bank's anti-money
laundering officer for advice.

Which of the following should the anti-money laundering officer advise as an initial step?

A. Verify the identity of all the partners.

B. Verify the source of the deposit.

C. File a suspicious transaction report with the appropriate Financial Intelligence Unit.

D. File a suspicious transaction report with the Egmont Group.

Answer: C


21.What is a major economic consequence of money laundering through the use of front companies?
A. Placing more emphasis on manufacturing

B. Weakening of the legitimate private sector

C. Creating a more competitive pricing environment

D. Aligning management principles between criminal enterprises and legitimate businesses

Answer: B

Explanation:

Undermining the Legitimate Private Sector: One of the most serious microeconomic effects of money
laundering is felt in the private sector. Money launderers are known to use front companies: businesses
that appear legitimate and engage in legitimate business but are in fact controlled by criminals who
commingle the proceeds of illicit activity with legitimate funds to hide the ill-gotten gains. These front
companies have a competitive advantage over legitimate firms as they have access to substantial illicit


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funds, allowing them to subsidize products and services sold at below market rates. This makes it difficult
for legitimate businesses to compete against front companies. Clearly, the management principles of
these criminal enterprises are not consistent with traditional free market principles, which results in further
negative macroeconomic effects

Reference: http://people.exeter.ac.uk/watupman/undergrad/rtb/effects2.htm


22.Findings from a regulatory examination report states that the job descriptions of personnel outside of
the compliance department do not include references to anti-money laundering responsibilities.

Which action should the firm take?

A. Update all job descriptions to include anti-money laundering responsibilities

B. Respond that only compliance personnel have anti-money laundering responsibilities

C. Send an email to all staff stating that personnel must observe the anti-money laundering policy

D. Reply that a description of anti-money laundering responsibilities is included in the annual training
Answer: D


23.A compliance officer learns from an Information Technology (IT) source of a potential new financial
service being discussed by the new product approval committee.

What is the correct next course of action?

A. Request that the new product approval committee include the compliance officer.

B. Go to the board of directors and try to shut the new service down immediately because the committee
did not communicate with the compliance officer.

C. Get as much information as possible from the source so that potential risks can be researched and a
report prepared and presented to the head of marketing.

D. Start initial research into potential risks but wait until notified that the service has been approved by the
committee before initiating extensive research.

Answer: A


24.According to the Financial Action Task Force 40 Recommendations, Designated Non-Financial
Businesses and Professionals include which entities?

A. Commodities traders

B. Money services businesses

C. Hawala operators

D. Real estate agents

Answer: D

Explanation:

Reference:

http://www. fatf-gafi.org/media/fatf/documents/recommendations/pdfs/FATF %20Recommendations%20(a
pproved%20F ebruary%202012)%20reprint%20May%202012%20web%20version.pdf (page19, DNFBPs:
customer due diligence, bulleted point (b))


25.Which of the following provides anti-money laundering specialists information related to money
laundering trends?

1. Egmont Group's 100 Cases

2. Financial Action Task Force Typologies


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3. FinCEN's SAR Activity Review
4. The Wolfsberg Principles

A. 1, 2, and 3 only

B. 1, 2, and 4 only

C. 1, 3, and 4 only

D. 2, 3, and 4 only

Answer: C


26.Transfers of money over the last 6 months to a corporation in a jurisdiction with strict secrecy laws
triggered an alert.

Which of the following should cause the most suspicion of money laundering?

A. The jurisdiction is a known tax haven.

B. The company has bearer shares.

C. The corporation director is a European citizen.

D. No financial statements have been filed for 3 years.

Answer: A


27.In many jurisdictions, financial institutions are prohibited from hiring a person who has been convicted
of what type of offense?

A. Kidnapping

B. Offenses involving dishonesty

C. Driving while under the influence

D. Protests of government action

Answer: B

Explanation:

Reference: http:/Awww.capitol.hawaii.gov/hrscurrent/vol07_ch0346-0398/HRS0378/HRS_0378-0003.htm
(See 9th point)


28.Which three methods are commonly used by an accountant to launder money? (Choose three.)
A. Representing a client court

B. Understanding income to take a tax loss

C. Overstating income to hide excess cash

D. Acting as a conduit for transferring cash between accounts

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

Answer: C,D,E

Explanation:

https://www.ojp.gov/pdffiles 1/Digitization/119840NCJRS. pdf
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