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NEW QUESTION # 54
An EU bank account received 1.8 million EUR from a Swiss bank. The EU bank determines the originator was indicted by U.S. law enforcement, arrested in Switzerland, and extradited for alleged insider trading.
Which is the best reason the EU bank should file a SAR/STR?
- A. Insider trading is a predicate offense in the U.S. and Switzerland.
- B. The events raise concerns that the payment represents proceeds from insider trading.
- C. The Swiss bank filed a SAR/STR with the Money Laundering Reporting Office Switzerland.
- D. The originator was indicted by U.S. law enforcement.
Answer: B
Explanation:
Explanation
The best reason the EU bank should file a SAR/STR is that the events raise concerns that the payment represents proceeds from insider trading, which is a form of market abuse and a predicate offense for money laundering in many jurisdictions. The fact that the originator was indicted by U.S. law enforcement, arrested in Switzerland, and extradited for alleged insider trading indicates that there is a strong suspicion that the funds are derived from criminal activity. The other options are not sufficient reasons to file a SAR/STR, as they do not directly relate to the nature or source of the funds.
References: [Financial Action Task Force Report on Money Laundering and Terrorist Financing Risks and Vulnerabilities Associated with Gold], page 17 : [Leading Complex Investigations Certificate], page 12
NEW QUESTION # 55
A financial institution (Fl) banks a money transmitter business (MTB) located in Miami. The MTB regularly initiates wire transfers with the ultimate beneficiary in Cuba and legally sells travel packages to Cuba. The wire transfers for money remittances comply with the country's economic sanctions policies. A Fl investigator on the sanctions team reviews each wire transfer to ensure compliance with sanctions and to monitor transfer details.
An airline located in Cuba, unrelated to the business, legally sells airline tickets in Cuba to Cuban citizens wanting to travel outside of Cuba. The airline tickets are purchased using Cuban currency (CUC).
The MTB wants 100,000 USD worth of CUC. Purchasing CUC from a Cuban bank includes a 4% fee. The MTB contacts the airline to ask if the airline will trade its CUC for USD at a lower exchange fee than the Cuban bank. The airline agrees to a 1% fee. The MTB initiates a wire transfer to the airline which appears as normal activity in the monitoring system because of the business' travel package sales.
Which investigative actions should the investigator take concerning the 100.000 USD wire transfer? (Select Three.)
- A. Review regulations applicable to foreign currency trading transactions.
- B. Review the wire transfer protocols for this customer.
- C. Recommend a plan for the Fl's management to restrict the account relationship.
- D. Review a sampling of wire transfers initiated by travel companies with Cuba travel packages.
- E. Gather all account activity for Fl clients that purchased packages from the airline.
- F. Locate and review licenses, registrations, and account operating agreements associated with the MTB account.
Answer: A,B,F
Explanation:
Explanation
The investigator should take the following investigative actions concerning the 100,000 USD wire transfer:
Review the wire transfer protocols for this customer. This will help the investigator to determine if the wire transfer is consistent with the customer's normal business activity and risk profile, or if it deviates from the established patterns or thresholds.
Review regulations applicable to foreign currency trading transactions. This will help the investigator to assess if the wire transfer violates any laws or regulations related to currency exchange, such as reporting requirements, licensing requirements, or sanctions compliance.
Locate and review licenses, registrations, and account operating agreements associated with the MTB account. This will help the investigator to verify if the MTB has the necessary authorization and documentation to conduct currency exchange transactions and if it has disclosed this activity to the FI.
References: Advanced CAMS-FCI Study Guide, pages 32-33.
NEW QUESTION # 56
Which test should be included in a bank's Office of Foreign Assets Control sanctions screening audit program?
- A. Reviewing wire transfer screening processes to ensure that potential name hits are investigated promptly
- B. Ensuring that all clients with foreign identification are subject to enhanced due diligence
- C. Looking at copies of suspicious activity reports filed with regulators to ensure completeness
- D. Examining Human Resources processes for conducting criminal background checks on executives
Answer: B
Explanation:
Explanation
The OFAC sanctions screening audit program should include the requirement that all clients with foreign identification are subject to enhanced due diligence, as this provides an extra layer of protection against potential violations of OFAC sanctions.
NEW QUESTION # 57
A financial institution (Fl) receives an urgent request for information from the financial intelligence unit (Fl country. According to FATF recommendations, which is the best action for the FI to take?
- A. Provide as much information as possible to the FIU immediately.
- B. Request an official court subpoena with details of the investigation.
- C. Establish a committee from different areas of the Fl to determine if the request should be answered.
- D. Inform the public relations department to prepare for negative news.
- E. ling the financing of terrorism that could imply an imminenl threat in the
Answer: A
Explanation:
Explanation
The correct answer is B because the FATF recommendations state that financial institutions should provide feedback to the FIU as quickly as possible, especially in cases involving the financing of terrorism that could imply an imminent threat to the country. Option A is incorrect because requesting an official court subpoena would delay the response and might not be necessary for the FIU to access the information. Option C is incorrect because establishing a committee would also delay the response and might not be in compliance with the FIU's request. Option D is incorrect because informing the public relations department is irrelevant to the question and might compromise the confidentiality of the investigation.
References: FATF Recommendations, Recommendation 29; Leading Complex Investigations Certificate, Module 4.
NEW QUESTION # 58
Which most likely indicates that a business email compromise attack has occurred?
- A. A company sends a larger-than-normal check to an existing supplier.
- B. A company has a new beneficial owner.
- C. A company adds a new employee as an authorized signer.
- D. A company sends a recurring payment to a new account number.
Answer: D
Explanation:
Explanation
When writing or reviewing a SAR/STR, it is important to ensure that the narrative is kept to the point; easy to read; and addresses the who, what, when, where, why, and how. This is because the narrative is the most crucial part of the SAR/STR, as it provides a clear and concise summary of the suspicious activity or transaction that triggered the report. The narrative should include all the relevant information that would help law enforcement or regulators to understand the nature and context of the activity or transaction, such as123:
The who: The names, addresses, account numbers, and other identifying information of the parties involved in the activity or transaction, such as customers, beneficiaries, intermediaries, or third parties.
The what: The type, amount, frequency, and purpose of the activity or transaction, such as cash deposits, wire transfers, check payments, or purchases of goods or services.
The when: The date, time, and duration of the activity or transaction, and whether it was a one-time occurrence or part of a pattern or trend.
The where: The location or channel of the activity or transaction, such as branches, ATMs, online platforms, or mobile applications.
The why: The reason or rationale for the activity or transaction, and why it was considered suspicious or unusual based on the customer's profile, behavior, or expected activity.
The how: The method or mechanism of the activity or transaction, such as cash, check, debit card, credit card, cryptocurrency, or prepaid card.
References:
How to write the perfect "Suspicious Activity Reports" (SAR)? | i-AML
Writing for Prosecution: Best Practices For Composing SAR Narratives That Assist Prosecutors | ACAMS SAR Writing Examples and Proper Formatting: Write for Your Reader - Alessa
NEW QUESTION # 59
During transaction monitoring. Bank A learns that one of its customers. Med Supplies 123, is attempting to make a payment via wire totaling 382.500 USD to PPE Business LLC located in Mexico to purchase a large order of personal protective equipment. specifically surgical masks and face shields. Upon further verification.
Bank A decides to escalate and refers the case to investigators.
Bank A notes that days prior to the above transaction, the same customer went to a Bank A location to wire
1,215,280 USD to Breath Well LTD located in Singapore. Breath Well was acting as an intermediary to purchase both 3-ply surgical masks and face shields from China. Bank A decided not to complete the transaction due to concerns with the involved supplier in China. Moreover, the customer is attempting to send a third wire in the amount of 350,000 USD for the purchase of these items, this time using a different vendor in China. The investigator must determine the next steps in the investigation and what actions, if any. should be taken against relevant parties.
The investigator is gathering more information to determine if a SAR/STR filing is needed. Which steps are the correct ways of collecting the additional information? (Select Two.)
- A. Reach out to the relationship manager asking if more up-to-date customer due diligence information can be collected on the customer.
- B. Use available documentation received from law enforcement (e.g.. grand jury subpoena) as red flags in SAR/STR filing.
- C. Reach out to the customer and ask for supporting documentation for the conducted wires to avoid SAR/STR filing.
- D. Issue a USA PATRIOT ACT Section 314(b) request to participating financial institutions advising that information is needed to decide if the activity is suspicious.
- E. Conduct open-source research to determine if the customer and involved counterparties are in the same business field.
Answer: A,E
Explanation:
Explanation
The correct answer is A and C because these indicators suggest that the customer is using fraudulent documents and misrepresenting the goods to conceal the illicit nature of the transactions. Fentanyl traffickers often use front companies and falsified invoices to disguise their shipments as legitimate products, such as medical supplies or chemicals. Reviewing the invoices and transportation documents, as well as the FDA product certifications, can help to identify discrepancies or anomalies that indicate fraud or deception.
References: Fentanyl and Fentanyl Analogues: Federal Trends and Trafficking Patterns, page 18; Fentanyl Trafficking Offenses, page 2.
NEW QUESTION # 60
An investigator at a corporate bank is conducting transaction monitoring alerts clearance.
KYC profile background: An entity customer, doing business offshore in Hong Kong, established a banking business relationship with the bank in 2017 for deposit and loan purposes. It acts as an offshore investment holding company. The customer declared that the ongoing source of funds to this account comes from group-related companies.
* X is the UBO. and owns 97% shares of this entity customer;
* Y is the authorized signatory of this entity customer. This entity customer was previously the subject of a SAR/STR.
KYC PROFILE
Customer Name: AAA International Company. Ltd
Customer ID: 123456
Account Opened: June 2017
Last KYC review date: 15 Nov 2020
Country and Year of Incorporation: The British Virgin Islands, May 2017 AML risk level: High Account opening and purpose: Deposits, Loans, and Trade Finance Anticipated account activities: 1 to 5 transactions per year and around 1 million per transaction amount During the investigation, the investigator reviewed remittance transactions activities for the period from Jul
2019 to Sep 2021 and noted the following transactions pattern:
TRANSACTION JOURNAL
Review dates: from July 2019 to Sept 2021
For Hong Kong Dollars (HKD) currency:
Incoming transactions: 2 inward remittances of around 1.88 million HKD in total from different third parties Outgoing transactions: 24 outward remittances of around 9 4 million HKD in total to different third parties For United States Dollars (USD) currency:
Incoming transactions: 13 inward remittances of around 3.3 million USD in total from different third parties Outgoing transactions: 10 outward remittances of around 9.4 million USD in total to different third parties.
RFI Information and Supporting documents:
According to the RFI reply received on 26 May 2021, the customer provided the bank with the information below:
1J All incoming funds received in HKD & USD currencies were monies lent from non-customers of the bank.
Copies of loan agreements had been provided as supporting documents. All of the loan agreements were in the same format and all the lenders are engaged in trading business.
2) Some loan agreements were signed among four parties, including among lenders. borrower (the bank's customer), guarantor, and guardian with supplemental agreements, which stated that the customer, as a borrower, who failed to repay the loan Which additional information would support escalating this account for closure?
- A. A follow-up request reveals that the account receives funds from loans, collects payments from group-related companies, and sends the payments to the lenders.
- B. A review of X's personal bank account shows that X received wire transfers that aggregate the amounts transferred to the group-related companies.
- C. A review of outward remittances reveals the same pattern of several simple steps for each transaction,
- D. The bank files SARs/STRs indicating that Y opened accounts for small companies located in close proximity to the bank.
Answer: C
Explanation:
Explanation
A review of outward remittances reveals the same pattern of several simple steps for each transaction, which could indicate a layering scheme to obscure the origin and destination of the funds. This would support escalating this account for closure, as it is inconsistent with the customer's declared purpose and anticipated activities. The other options are not relevant or sufficient to warrant account closure.
References: Advanced CAMS-FCI Certification | ACAMS
NEW QUESTION # 61
An investigator receives an alert documenting a series of transactions. A limited liability corporation (LLC) wired 59.000,000 USD to an overseas account associated with a state-run oil company. A second account associated with the state-run oil company wired 600,000,000 USD to the LLC. The LLC then wired money to other accounts, a money brokerage firm, and real estate purchases.
The investigator initiated an enhanced KYC investigation on the LLC. The financial institution opened the LLC account a couple of weeks prior to the series of transactions. The names associated with the LLC had changed multiple times since the account opened. A search of those names revealed relations with multiple LLCs. Public records about the LLCs did not show any identifiable business activities.
Open-source research identified mixed reports about the brokerage firm.
The firm indicated it purchased mutual funds for its clients and dispensed returns to clients.
Media reports claimed the firm laundered money by holding money for a fee before returning it to investors.
Which information should the investigator review first when examining the wire transaction documentation?
- A. The sanctions screening tool to see if the transaction was stopped
- B. How the wire transfers were initiated (e.g., phone, online, branch visit)
- C. Whether the wire transfers were initiated domestically
- D. The Travel Rule requirements for recordkeeping
Answer: B
Explanation:
Explanation
The investigator should review how the wire transfers were initiated first, because this could indicate the level of involvement and knowledge of the LLC account holders. If the wire transfers were initiated online or by phone, it could suggest that the account holders were trying to avoid face-to-face contact with the bank staff and reduce the chances of being questioned or identified. If the wire transfers were initiated in person at a branch, it could indicate that the account holders were confident or careless about their activities, or that they had some relationship with the bank staff. The method of initiation could also affect the quality and quantity of information collected by the bank about the wire transfers, such as the purpose, source, and destination of the funds. References: ACAMS Advanced Financial Crimes Investigations Certification Study Guide, page 65.
NEW QUESTION # 62
An investigator is reviewing a case generated from the transaction monitoring system, with two large amounts of incoming remittance (IR) to an individual customer. Based on the KYC profile, the customer is a plant manager of a famous multi-national electronics manufacturing firm. As the customer has no similarly large transaction patterns for the past 2 years, the investigator sends an inquiry to the relationship manager (RM) about the nature of the transaction. The RM replies that the transaction is a consultancy fee provided from two different electronics companies with a debit note provided However, there is no detail of service provided on the debit note, and the remitters are two individuals.
Which actions should the investigator recommend to mitigate risk? (Select Two.)
- A. Re-evaluate the customer risk profile.
- B. Exit the relationship with the customer.
- C. Conduct enhanced due diligence.
- D. Document and maintain a file with the investigative findings.
- E. Discuss the investigation findings with the customer.
Answer: A,C
Explanation:
Explanation
The actions that the investigator should recommend to mitigate risk are conducting enhanced due diligence (D) and re-evaluating the customer risk profile (E). These actions are appropriate and prudent, as they allow the investigator to obtain more information and evidence about the nature and purpose of the transactions, the source and destination of the funds, and the identity and legitimacy of the parties involved. According to the ACAMS Advanced Financial Crimes Investigations Certification Study Guide1, "the FI should conduct enhanced due diligence on all parties involved in the investigation, including checking various sources of information, such as watch lists, sanctions lists, negative news, and official registries" (p. 24). The FI should also "re-assess the customer risk profile based on any new information obtained during the investigation, and adjust the customer due diligence and monitoring requirements accordingly" (p. 25).
The other options are not as appropriate or effective as options D and E. The investigator should not recommend exiting the relationship with the customer (A), as this could be premature or disproportionate, as well as potentially discriminatory or illegal. The investigator should not recommend documenting and maintaining a file with the investigative findings (B), as this is not an action to mitigate risk, but rather a standard procedure for any investigation. The investigator should not recommend discussing the investigation findings with the customer , as this could compromise the integrity and objectivity of the investigation, as well as expose the FI to legal or regulatory risks.
References: 1: ACAMS Advanced Financial Crimes Investigations Certification Study Guide
NEW QUESTION # 63
Which information is it best practice to share at the very beginning of a well-written SAR/STR narrative?
- A. Information about any follow-up actions conducted by the financial institution on the account
- B. Any and all relevant facts about the parties who facilitated the suspicious activity or transactions
- C. The purpose of the SAR/STR narrative and a general description of the known or alleged violation
- D. A specific description of the involved accounts and transactions, including the origination and application of funds
Answer: C
Explanation:
Explanation
The best information to share at the very beginning of a well-written SAR/STR narrative is the purpose of the SAR/STR narrative and a general description of the known or alleged violation. This is because this information provides an overview of why the SAR/STR is being filed and what type of suspicious activity or transaction is involved. It also helps to capture the attention of the reader and set the tone for the rest of the narrative.
References: Reporting Suspicious Activity Certificate, Module 4, page 7.
NEW QUESTION # 64
While each is potentially important, which allows an investigations analyst to better write a SAR/STR narrative that is useful to law enforcement? (Select Two.)
- A. Including a detailed description of the known or suspected criminal violation or suspicious activity
- B. Including an explanation of the internal process that brought the transaction to the attention of the analyst
- C. Including contact information for individuals at other institutions with whom correspondence has occurred
- D. Including information about the general activity trends in the area where the suspicious transactions were conducted
- E. Ensuring all information in the SAR/STR is complete and accurate based on what the institution knows
Answer: A,E
Explanation:
Explanation
A SAR/STR narrative that is useful to law enforcement should include a detailed description of the known or suspected criminal violation or suspicious activity, as well as ensure that all information in the SAR/STR is complete and accurate based on what the institution knows. These elements help law enforcement to understand the nature and scope of the suspicious activity, and to follow up with further investigation if needed. The other options are not essential for a useful SAR/STR narrative, as they either provide irrelevant or redundant information, or could compromise the confidentiality of the report.
NEW QUESTION # 65
A SAR/STR regarding money-mule activity prompts law enforcement action. Under U.S. law, the alleged money mules can be prosecuted:
- A. in a country only if funds were transferred between accounts maintained in the same country.
- B. only if they were aware of their role and actively participated.
- C. even if they were unaware that money was transferred.
- D. unless they can prove they were not aware of the origin of the funds.
Answer: C
Explanation:
Explanation
According to U.S. law, money mules can be prosecuted even if they were unaware that money was transferred, as long as they acted with reckless disregard of the source of the funds or the purpose of the transaction1.
This is because money mules are considered to be aiding and abetting money laundering, which does not require proof of specific intent2.
References: 1: Money Mule Awareness Booklet, page 8 2: Money Laundering: An Overview of 18 U.S.C. ยง 1956 and Related Federal Criminal Law, page 7
NEW QUESTION # 66
An investigator receives an alert documenting a series of transactions. A limited liability corporation (LLC) wired 59.000.000 USD to an overseas account associated with a state-run oil company. A second account associated with the state-run oil company wired 600,000,000 USD to the LLC. The LLC then wired money to other accounts, a money brokerage firm, and real estate purchases.
The investigator initiated an enhanced KYC investigation on the LLC. The financial institution opened the LLC account a couple weeks prior to the series of transactions. The names associated with the LLC had changed multiple times since the account opened. A search of those names revealed relations with multiple LLCs. Public records about the LLCs did not show any identifiable business activities.
Open-source research identified mixed reports about the brokerage firm. The firm indicated it purchased mutual funds for its clients and dispensed returns to clients. Media reports claimed the firm laundered money by holding money for a fee before returning it to investors.
What is the total suspicious transaction amount that the investigator should report?
- A. 59,000,000 USD
- B. 659,000,000 USD
- C. 541.000,000 USD
- D. 600,000,000 USD
Answer: B
Explanation:
Explanation
The total suspicious transaction amount that the investigator should report is 659,000,000 USD. This is the sum of the two transactions involving the LLC and the state-run oil company, which are 59,000,000 USD and
600,000,000 USD respectively. The other transactions that the LLC made to other accounts, a money brokerage firm, and real estate purchases are not relevant to the question, as they are not part of the series of transactions that triggered the alert.
References: Advanced CAMS-FCI Certification | ACAMS
NEW QUESTION # 67
SAR/STR NARRATIVE
A SAR/STR has been submitted on five transactions conducted on the correspondent banking relationship with ABC Bank.
Client Information:
Remitter information: DEF Oil Resource Ltd. is the oldest member of the DEF Group. It was founded in 1977 as a general trading business with a primary focus on exports from Africa and North America. The group has business activities that span the entire energy value chain. Their core field of endeavor is centered within the oil and gas industry and its associated sub-sectors.
Beneficiary Information:
As per the response received from ABC Bank, it was determined that the beneficiaries are related to DEF Oil Resource Ltd. These were created by DEF Oil Resource Ltd. to purchase property in a foreign country on behalf of their senior management as part of a bonus scheme. The purpose behind this payment was for purchase of property in another country.
Payment Reference:
ABCXXXXX31PZFG2H
ABCXXXXXX51PQGEH
ABCXXXXXX214QWVG
ABCXXXXXX41PSXA2
ABCXXXXXX815QWS3
Concerns:
* We are unsure about the country of incorporation of the beneficiaries.
* We are concerned about the transactional activity since the payment made towards entities (conducted on behalf of individuals) appears to be possible tax evasion.
* There appears to be an attempt to conceal the identity of individuals (senior management), which again raises concerns about the source of funds.
* Referring to the response received from ABC Bank, we are unclear about the ultimate beneficiary of funds.
* The remitter is involved in a high-risk business, (i.e., oil and crude products trading), and the beneficiary is involved in a real estate business which again poses a higher risk.
The monitoring system of the correspondent institution flags the transaction as suspicious activity. The correspondent bank needs to send a request for information to the respondent bank. Which elements should be included in the request? (Select Three.)
- A. The account profile of the customer and their KYC data
- B. Details of DEF Oil Resource Ltd parent company and the name(s) of the beneficial owner(s)
- C. The respondent bank's customer's senior management bonus plan
- D. The contract pertaining to the purchase of property in another country
- E. Full transaction history of the correspondent bank's customer
- F. The last 6 months of transactional history
Answer: A,B,D
Explanation:
Explanation
The request for information should include the following elements:
Details of DEF Oil Resource Ltd parent company and the name(s) of the beneficial owner(s) (Option A): This is necessary to verify the identity and ownership structure of the remitter and to assess the risk level of the customer and the transaction.
The account profile of the customer and their KYC data (Option C): This is necessary to understand the nature and purpose of the customer's business relationship with the respondent bank and to compare it with the observed transactional activity.
The contract pertaining to the purchase of property in another country (Option E): This is necessary to verify the legitimacy and source of funds for the transaction and to identify the ultimate beneficiary of funds.
The other options are not relevant or necessary for the request for information. The full transaction history of the correspondent bank's customer (Option B) is too broad and may not be related to suspicious activity. The respondent bank's customer's senior management bonus plan (Option D) is not relevant to the transaction and may not be available to the respondent bank. The last 6 months of transactional history (Option F) is also too broad and may not be related to the suspicious activity.
References:
Advanced CAMS-FCI Certification Handbook, page 19
NEW QUESTION # 68
The training department is conducting awareness training for unusual customer identification scenarios. Which two indicators should be included? (Select Two.)
- A. The customer frequently exchanges small bills for large bills.
- B. The customer opens the account in the name of a family member who begins making large deposits.
- C. The customer's internet protocol address does not match the identifying information provided during online registration.
- D. The customer requests payment of proceeds to an unrelated third party.
- E. The customer's name and home address cannot be verified
Answer: B,E
Explanation:
Explanation
This information can be found in the Certified Anti-Money Laundering Specialist (CAMS) study guide, 6th edition, under the section on Unusual Customer Identification Scenarios. The guide explains that two indicators that should be included in awareness training for unusual customer identification scenarios are:
A: The customer opens the account in the name of a family member who begins making large deposits.
This is an indicator of potential structuring, where a customer may be attempting to avoid triggering reporting thresholds by depositing funds in smaller amounts over time. It is important for staff to be aware of this scenario and to monitor accounts for potential suspicious activity.
B: The customer's name and home address cannot be verified.
This is an indicator of potential identity theft or other fraudulent activity. If a customer's identifying information cannot be verified, it is important for staff to conduct additional due diligence to ensure that the customer is legitimate and that the account is not being used for illicit purposes.
NEW QUESTION # 69
The intended benefits of section 314(b) of the USA PATRIOT Act include: (Select Three.)
- A. detecting money laundering and TF approaches and schemes across multiple financial institutions (FIs).
- B. expediting the filing of SARs/STRs due to the information sharing facilitated by 314(b).
- C. sharing the existence and content of SARs/STRs with other participating FIs.
- D. providing mandatory results to law enforcement agencies so that they can more easily obtain useful information.
- E. obtaining additional information on customers or transactions regarding potential money laundering or terrorist financing (TF).
- F. participating FIs sharing information about suspicious activity by customers that may have otherwise gone unnoticed.
Answer: A,E,F
Explanation:
Explanation
Section 314(b) of the USA PATRIOT Act allows financial institutions to share information with each other, under a safe harbor that offers protection from liability, in order to better identify and report potential money laundering or terrorist financing activities. The intended benefits of this information sharing include:
Participating financial institutions sharing information about suspicious activity by customers that may have otherwise gone unnoticed. For example, if a customer is conducting transactions with multiple financial institutions that individually do not appear suspicious, but collectively indicate a pattern of money laundering or terrorist financing, the financial institutions can share this information and report it to the authorities.
Detecting money laundering and terrorist financing approaches and schemes across multiple financial institutions. For example, if a financial institution identifies a new typology or modus operandi of money laundering or terrorist financing, it can share this information with other financial institutions to help them prevent or detect similar activities by their customers.
Obtaining additional information on customers or transactions regarding potential money laundering or terrorist financing. For example, if a financial institution has incomplete or insufficient information on a customer or a transaction that raises suspicion, it can request more information from another financial institution that may have dealt with the same customer or transaction.
References:
Section 314(b) | FinCEN.gov
Section 314(b) Fact Sheet - FinCEN.gov
NEW QUESTION # 70
When crafting internal procedures on writing and submitting SARs/STRs, one should:
- A. use internal keywords and standard industry terms to better provide context within which the suspicious activity was identified.
- B. include attachments with the SARs/STRs as all information needs to be at the disposal of the financial intelligence unit (FIU)
- C. adhere to home junsdiction guidelines across the whole group when local requirements of the country of operation and home jurisdiction conflict.
- D. consider the guidelines issued by the national financial intelligence unit {FIU) and local regulator and incorporate any country-specific requirements.
Answer: D
Explanation:
Explanation
When writing and submitting SARs/STRs, one should consider the guidelines issued by the national financial intelligence unit (FIU) and local regulator and incorporate any country-specific requirements. This ensures that the reports are compliant with the relevant laws and regulations and provide useful information to the authorities. The other options are either incorrect or not best practices.
References: Advanced CAMS-FCI Study Guide, page 48-49.
NEW QUESTION # 71
A bank's transaction surveillance system triggers an alert for a deposit of 250.000 USO into a client's account.
According to the bank's KYC information, the client works for a financial advisory firm, and earns approximately 100,000 USD per year. Which actions should be taken? (Select Three.) File the suspicious transaction immediately to the financial intelligence unit.
- A. Contact the client advisor to learn if he has any insight on the transaction background.
- B. Review the transaction background in the bank's transaction platform.
- C. Discard the alert as a false positive hit
- D. Request information and documentation from the client on the background of the transaction.
- E. Review the alert if the deposit is made in cash.
Answer: A,B,D
Explanation:
Explanation
According to the Certified Anti-Money Laundering Specialist (CAMS) Manual , 6th edition, if a bank's transaction surveillance system triggers an alert for a deposit of 250.000 USD into a client's account, the bank should take the following actions:
Request information and documentation from the client on the background of the transaction (CAMS Manual, 6th edition, page 46).
Contact the client advisor to learn if he has any insight on the transaction background (CAMS Manual,
6th edition, page 47).
Review the transaction background in the bank's transaction platform (CAMS Manual, 6th edition, page
47).
Discarding the alert as a false positive hit and reviewing the alert if the deposit is made in cash should not be done.
The bank should request additional information and documentation from the client to better understand the nature of the transaction. Additionally, the bank should reach out to the client advisor to learn if they have any insight on the transaction background. Finally, the bank should review the transaction background in the bank's transaction platform to determine if any additional alerts or anomalies are present. (CAMS Manual, 6th Edition, Pages 117-118)
NEW QUESTION # 72
The investigations team of a financial institution (Fl) wants to perform enhanced due diligence measures on operations done by a foreign bank related to transactions of companies that export scrap gold and silver. What would be the next best steps for the investigations team? (Select Two.)
- A. Ask the legal department if it can proceed to rescind the contract of the correspondent banking relationship since the export of scrap gold and silver is a high-risk activity.
- B. Ask the respondent bank if it has a risk rating for the exporting companies, if the customer profiles are updated, and if so. when was the last time it was done.
- C. Ask the respondent bank if the exporting companies have obtained an official license that permits the exporting of scrap gold and silver.
- D. Ask the business manager who handles the relationship of the respondent bank if they can persuade the bank to close the accounts of the export companies.
- E. Ask the respondent bank if it can file a SAR/STR in its jurisdiction since the investigations team also plans to do the same in the Fl's home country.
Answer: B,C
Explanation:
Explanation
The correct answers are B and C because these are the most relevant and reasonable steps for the investigations team to perform enhanced due diligence on the operations of the foreign bank and its customers.
Asking for the risk rating, customer profiles, and official licenses would help the team assess the level of risk and compliance of the foreign bank and its customers, who are engaged in a high-risk activity of exporting scrap gold and silver. The other options are not appropriate because they are either premature or ineffective.
Rescinding the contract, filing a SAR/STR, or closing the accounts would require more evidence and justification, and they may also damage the relationship with the foreign bank.
References: : Precious Metals & Stones
NEW QUESTION # 73
A country that does not have strong predicate offenses and is lax in prosecuting AML cases could suffer which social/economic consequence?
- A. Loss of tax revenue
- B. US sanctions
- C. Increased organized crime and corruption
- D. Reputation risk for the port
Answer: C
Explanation:
Explanation
A country that does not have strong predicate offenses and is lax in prosecuting AML cases could suffer increased organized crime and corruption as a social/economic consequence. "Weaknesses in the AML/CFT regime can lead to a range of economic and social consequences, including...increased crime and corruption." (CAMS Manual, 6th Edition, page 32)
NEW QUESTION # 74
An investigator at a corporate bank is conducting transaction monitoring alerts clearance.
KYC profile background: An entity customer, doing business offshore in Hong Kong, established a banking business relationship with the bank since 2017 for deposit and loan purposes. It acts as an offshore investment holding company. The customer declared that the ongoing source of funds to this account comes from group-related companies.
* X is the UBO. and owns 97% shares of this entity customer;
* Y is is the authorized signatory of this entity customer. This entity customer was previously the subject of a SAR/STR.
KYC PROFILE
Customer Name: AAA International Company. Ltd
Customer ID: 123456
Account Opened: June 2017
Last KYC review date: 15 Nov 2020
Country and Year of Incorporation: The British Virgin Islands, May 2017 AML risk level: High Account opening and purpose: Deposits, Loans and Trade Finance Anticipated account activities: 1 to 5 transactions per year and around 1 million per transaction amount During the investigation, the investigator reviewed remittance transactions activities for the period from Jul
2019 to Sep 2021 and noted the following transactions pattern:
TRANSACTION JOURNAL
Review dates: from July 2019 to Sept 2021
For Hong Kong Dollars (HKD) currency:
Incoming transactions: 2 inward remittances of around 1.88 million HKD in total from different third parties Outgoing transactions: 24 outward remittances of around 9 4 million HKD in total to different third parties For United States Dollars (USD) currency:
Incoming transactions: 13 inward remittances of around 3.3 million USD in total from different third parties Outgoing transactions: 10 outward remittances of around 9.4 million USD in total to different third parties.
RFI Information and Supporting documents:
According to the RFI reply received on 26 May 2021, the customer provided the bank with the information below:
1) All incoming funds received in HKD & USD currencies were monies lent from non-customers of the bank.
Copies of loan agreements had been provided as supporting documents. All of the loan agreements were in the same format and all the lenders are engaged in trading business.
2) Some loan agreements were signed among four parties, including among lenders. borrower (the bank's customer), guarantor, and guardian with supplemental agreements, which stated that the customer, as a borrower, who failed to repay the loan After reviewing the transaction journal, request for information response, and supporting documentation, the investigator determines that additional information is needed. Which additional information should the investigator request?
- A. Adverse news screening on all names listed in the formation documents
- B. Formation document/description of the group-related companies
- C. Source of the incoming funds to the group-related companies
- D. Previously filed SARVSTR unrelated to the customer, but similar in content
Answer: C
Explanation:
Explanation
The additional information that the investigator should request is the source of the incoming funds to the group-related companies. This is because the customer declared that the ongoing source of funds to this account comes from group-related companies, but the transaction journal shows that the customer received funds from different third parties, not from group-related companies. Therefore, the investigator should verify the relationship and legitimacy of these third parties and their funds with the customer and the group-related companies. The other options are not relevant or necessary for this investigation.
References: Advanced CAMS-FCI Certification | ACAMS
NEW QUESTION # 75
A KYC specialist from the first line of defense at a bank initiates an internal escalation based on a letter of credit received by the bank.
MEMO
To: Jane Doe. Compliance Manager, Bank B From: Jack Brown, KYC Specialist, Bank B RE: Concerning letter of credit A letter of credit (LC) was received from a correspondent bank. Bank A. in Country A. in Asia with strict capital controls, providing guarantee of payment to Bank B's client for the export of 10 luxury cars located in Country B. located in Europe. Bank A's customer is a general in the army where Bank A is headquartered.
The information contained in the LC is as follows:
* Advising amount per unit 30.000.00 EU *10 units of BMW
* Model IX3
* Year of registration: 2020
Upon checks on Bank B's client, the exporter mentioned that the transactions were particularly important, and a fast process would be much appreciated in order to avoid reputational damage to the firm and the banks involved in the trade finance process. The exporter has a longstanding relationship with Bank B and was clearly a good income generator. The exporter indicated that, as a general, the importer was trustworthy.
The relationship manager <RM) was contacted to conduct a full review of the exporter and to conduct a site visit.
Feedback from the RM:
The RM contacted the exporter for a client courtesy visit, but it was rearranged four times as the exporter kept cancelling the appointments. When the exporter was finally pinned down for an interview, employees were reluctant to provide clear answers about the basis of the transaction. The employees were evasive when asked about the wider business and trade activity in the country.
Findings from the investigation from various internal and external sources of information:
* There were no negative news or sanctions hits on the exporter company, directors, and shareholders.
* The registered address of the exporting business was a residential address.
* The price of the cats was checked and confirmed to be significantly below the market price of approximately
70,000 EU, based on manufacturer's new price guide.
* The key controllers behind the exporting company, that is the directors and During the investigation, the investigator determines that a nephew of the general.....
- A. is a trustworthy source.
- B. should be treated well to avoid reputational damage to the bank
- C. should be flagged as a senior PEP.
- D. is a high-net-worth individual
Answer: C
Explanation:
Explanation
The investigator should determine that a nephew of the general (Bank A's customer) should be flagged as a senior PEP . This is because the nephew is related to a senior military official who is a customer of Bank A, which is a high-risk jurisdiction with strict capital controls. According to the ACAMS Advanced Financial Crimes Investigations Certification Study Guide1, "the FI should identify and flag any customers who are PEPs or have close associations with PEPs, such as family members or business partners" (p. 24). The FI should also conduct enhanced due diligence on these customers and monitor their transactions for any suspicious or unusual activity.
The other options are not correct. The investigator should not determine that a nephew of the general should be treated well to avoid reputational damage to the bank (A), as this could compromise the integrity and objectivity of the investigation, as well as expose the bank to legal or regulatory risks. The investigator should not determine that a nephew of the general is a high-net-worth individual (B), as this is not relevant or material to the investigation, as the nephew's wealth does not affect his potential PEP status or risk level. The investigator should not determine that a nephew of the general is a trustworthy source (D), as this could be biased or inaccurate, as the nephew's trustworthiness does not depend on his relation to the general or his involvement in the transaction.
References: 1: ACAMS Advanced Financial Crimes Investigations Certification Study Guide, available at ACAMS
NEW QUESTION # 76
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