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

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Total 313 questions

An internal audit team is reviewing the anti-financial crime (AFC) program of its firm.

Which of the following attributes of the third line of defense would be most critical to ensure unbiased and effective oversight?

A.

Consistency of approach

B.

Periodic training of the function

C.

Qualification of the team

D.

Independent testing

The role of FATF-style regional bodies (FSRBs) is to; (Select Three.)

A.

identify and address the current financial crime trends through the issuance of typologies originating in members outside of their FSRB's Jurisdiction.

B.

provide AM L/C FT technical assistance needed by members in their FSRB junsdiction.

C.

coordinate technical assistance for members in their FSRB jurisdiction

D.

set and amend the FATF 40 Recommendations for members in their FSRB jurisdiction.

E.

identify and address any gaps in the AML/CFT policies for members outside of their FSRB jurisdiction.

F.

offer mutual evaluation and follow-up processes for members in their FSRB Jurisdiction.

A large international bank's chief compliance officer (CCO) is exploring ways to enhance the bank's ability to identify suspicious activities by using intelligence data more effectively. One potential solution is to engage in public-private partnerships (PPPs) to leverage shared intelligence and enhance collaboration with government agencies.

The bank considers joining a PPP initiative with the local Financial Intelligence Unit (FIU) and other financial institutions to improve its access to relevant data and intelligence. The CCO understands that while PPPs can provide significant benefits, such as improved risk detection and enhanced information sharing, there are also potential limitations, including data privacy concerns and differing priorities between public and private sector partners.

Which approach would best maximize the benefits of PPPs for the bank while mitigating the limitations associated with data sharing and intelligence?

A.

Engage in the PPP without strict data sharing protocols, allowing for open and unrestricted flow of information between the bank, FIUs, and other financial institutions

B.

Rely solely on the intelligence provided by government agencies through the PPP because they have the most comprehensive data on suspicious activities

C.

Establish a clear framework within the PPP that outlines data privacy protections and ensures that information sharing complies with legal and regulatory requirements in all jurisdictions involved

D.

Prioritize the bank’s internal data sources over external intelligence from PPPs, as internal data is easier to control and does not present data privacy challenges

The manager of a bank's KYC team discovers that a high-risk customer's activity was not reviewed last quarter as the bank's internal schedule required.

What should the KYC team manager do?

A.

Submit a referral to file a suspicious activity report (SAR)

B.

Evaluate the KYC review process to understand why the review did not occur as required and take corrective action as necessary

C.

Contact the customer's relationship manager to suspend account access until the periodic KYC review is completed

D.

Remove the customer from the bank's high-risk list

Which strategies are most effective for prioritizing resources within an anti-financial crime (AFC) program using a risk-based approach (RBA)? (Choose two.)

A.

Prioritizing resources towards lower-risk areas to reduce workload

B.

Regularly reassessing risks to adjust resource allocation

C.

Allocating more resources to areas with higher financial crime risk

D.

Providing equal resources to all departments to maintain consistency

E.

Using a fixed resource allocation plan without adjustments

At a high level, the risk assessment process involves identifying and rating the inherent risks associated with customers, products, countries, and delivery channels, and then:

A.

comparing these risks with industry benchmarks to determine the residual risk.

B.

implementing new controls to eliminate all risks

C.

rating the effectiveness of the related controls in order to calculate the residual risk.

D.

documenting the historical risk incidents for future reference.

Which of the following measures can help maintain the independence of BSA/AML compliance staff to ensure effective compliance controls?

A.

Establishing BSA/AML compliance staff reporting to the management of the business line in the first line of defense

B.

Ensuring BSA/AML compliance staff is primarily outsourced

C.

Providing BSA/AML compliance staff a reporting line to compliance or other second line of defense internal control function

D.

Providing BSA/AML compliance staff with a reporting line to the chief financial officer

According to FinCEN, which red flags within a bank account may, taken together, be indications of modern slavery, human trafficking, and exploitation? (Select Two.)

A.

Incoming fund transfers from third-party payment processors, with limited originator information

B.

Transactional activity with a registered virtual currency exchange

C.

Large amounts of cash payments to migrant agricultural workers

D.

Frequent payments for online advertisements or non-local classified ads

Criminals may misuse financial statements prepared by accountants to hide illicit assets.

Which of the following scenarios poses the greatest risk of financial statement manipulation by criminals?

A.

A lack of professional body oversight or required use of accounting and auditing standards in the country of incorporation of the entity

B.

Criminals posing as individuals seeking financial advice to place assets out of reach to avoid future liabilities

C.

Incomplete records being provided during bookkeeping, making them difficult to audit

D.

Accountants being used as intermediaries to introduce criminals to financial institutions

Which red flags apply to trade-based money laundering (TBML) schemes? (Choose three.)

A.

Use of wire transfers

B.

Loitering

C.

Instructions or involvement from third parties

D.

Amended letters of credit without reasonable justification

E.

Non-standard settlement arrangements