ACAMS CAMS - Certified Anti-Money Laundering Specialist (CAMS7 the 7th edition)

Lawyers, accountants, and TCSPs are considered gatekeepers because they serve as an entry point to the financial system and act as a first line of defense in preventing illicit funds from being integrated into the legitimate economy through their services and professional expertise.

Before opening for business, a bank must have independent compliance testing to ensure controls are functioning, qualified staff who understand AML/CFT requirements, and documented policies and procedures to guide day-to-day compliance. These are foundational elements of an effective AML/CFT framework.

E-commerce platforms face KYC challenges due to a global and diverse customer base, making due diligence complex, while criminals may exploit identity fraud to pass KYC checks and facilitate layering in money laundering schemes. These factors increase the financial crime risks for such businesses.

Effective AML programs promote aculture of compliance, which includes an environment where staff are empowered to raise concerns, challenge decisions, and continuously improve through cross-functional learning.Providing effective challengeis a supervisory expectation and best practice in institutions that value AML governance integrity.

While AML officer authority (option B) supports oversight, it is not as impactful on daily operational effectiveness as fostering a challenging and adaptive compliance culture.

Tax evasion is the deliberate and illegal act of not paying taxes that are legally owed. It is a criminal offense that can have serious consequences, including penalties, fines, and imprisonment.

In anEnterprise-Wide Risk Assessment (EWRA),residual riskis the level of risk that remains after applying mitigating controls to theinherent risk(the risk present before controls are applied).

In this scenario, theinherent risk is highdue to the nature of private banking—high net worth clients,cross-border transactions,complex ownership structures, andhigh-value financial products. However, the institution has implementedrobust CDD and EDD, as well asadvanced transaction monitoring systems.

According to the CAMS Study Guide – 6th Edition, wheneffective and properly implemented controlsare in place, they cansignificantly reducethe residual risk—even in high-risk business areas like private banking. However, no control framework caneliminate all riskentirely.

Option Ais correct: Controls can significantly reduce the residual risk when strong, effective systems and procedures are in place.

Option Bis partially true but suggests inadequacy, which is not indicated here.

Option Cincorrectly assumes residual risk cannot be lowered even with controls.

Option Dis incorrect because residual riskcannot be eliminated entirely.

The remote gambling sector presents unique money laundering and terrorist financing risks due to its online, non-face-to-face nature, as recognized in FATF and national regulatory guidance.

A major risk is that customers are not physically present for identification, which increases impersonation and identity fraud risks and requires robust digital onboarding controls.

Another significant risk is the use of anonymous prepaid cards or other anonymous payment methods. These instruments reduce traceability and can be used to introduce illicit funds into gambling platforms with limited customer identification.

Additionally, numerous low-level transactions may indicate structuring behavior designed to avoid enhanced due diligence thresholds and monitoring controls. This tactic allows criminals to layer transactions while appearing consistent with normal gambling behavior.

Large cash deposits are less relevant in remote gambling, as transactions are typically electronic. Betting beyond affordability may indicate problem gambling but is not, by itself, a core AML risk indicator.

The review should prioritize politically exposed persons (PEPs) risk, as state ownership increases the likelihood of political connections, and anti-bribery and corruption risk, since such environments may have higher exposure to corrupt practices and misuse of influence.