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NEW QUESTION 166
An anti-money laundering officer for a financial institution has been conducting a monthly self assessment.
The officer reviews the accounts increase in compliance with a long standing know your Customer policy. The self-assessment for the latest month shows a significant increase in compliance deficiencies for the first time in more than a year. What is the nest course of action for the anti-money laundering officer to take?
- A. Inform the Board of Directors promptly of the Know Your Customer policy trend over the last sixmonths.
- B. Determine if there is a readily identifiable cause for the deficiencies
- C. Implement a revision to the account-opening training program
- D. Revise the policy to simplify Know Your Customer compliance before the report is issued
Answer: C
NEW QUESTION 167
In some instances, a financial institution may receive a warrant from law enforcement authorities to search its premises. A search warrant is a grant of permission from a court for a law enforcement agency to search certain designated premises and seize specific categories of items or information. Generally, what is the required threshold for the requesting agency to establish in order to obtain a search warrant of a financial institution?
- A. Clear and convincing proof
- B. Probable cause
- C. A preponderance of the evidence
- D. Reasonable belief
Answer: D
NEW QUESTION 168
Which statement is true about when an institute becomes aware that a particular employee is under investigation by law enforcement as a result of a subpoena or warrant?
- A. The employee can and should be interviewed, as well as notified of the investigation todemonstrate the seriousness of the offence and to get the employee's full attention andcooperation
- B. If an independent investigation provides grounds to interview the employee, they can beinterviewed and, if necessary, terminated buy not advised that they are under investigation
- C. The institute has a duty as an employer to inform the employee he or she is under investigationby law enforcement, buy must not inform them that a warrant or subpoena has been received
- D. Under no circumstances can the employee be interviewed by the institution without theconsent of law enforcement for fear of tipping the employee off
Answer: B
NEW QUESTION 169
Which two statements are true regarding the European Union Money Laundering Directives? (Choose two.)
- A. They have extraterritorial impact and apply to states that have diplomatic relations with member states
- B. They apply to member states of the European Union
- C. They require member states to enact laws and/or regulations to comply with the directives
- D. They set forth non-binding best practices for financial institutions within the member states
Answer: B,C
Explanation:
Explanation/Reference: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32015L0849&from=FR
NEW QUESTION 170
A commission regotorie would be used in which gateway to obtain information from another country?
- A. A supervisory channel request with the Basel Committee
- B. An MLAT request
- C. An FIU request under the Egmont principles
- D. A FATF request
Answer: C
NEW QUESTION 171
After evaluating recent changes to international standards, an anti-money laundering specialist should consider enhanced due diligence on accounts held by:
- A. lawyers.
- B. foreign exchange dealers.
- C. precious metal dealers.
- D. retail account holders.
Answer: A,B,C
NEW QUESTION 172
Which situation is the highest risk fr money laundering and terrorist financing activity?
- A. A customer purchases casino chips using credit from an account at an affiliated casino andengages in significant game play before redeeming the chips for a casino check
- B. A customer purchases casino chips and engages in significant game play before requesting acasino check for the remainder
- C. A customer purchases casino chips using a credit card and engages in minimal game play beforeredeeming the chils for a casino check
- D. A customer purchases casino chips, using small denomination bank notes, but does not engagein game play before redeeming the chips for a casino check
Answer: C
NEW QUESTION 173
In order to protect investigative materials from disclosure when conducting an internal Investigation of any employee of a financial institution, legal counsel of that financial should ____________?
- A. Let the bank hire any and all contract investigators to conduct the internal investigation. That way Legal is not a party to the action and may remain independent
- B. Refuse to provide any records or documents to law enforcement because the bank has client privilege with its bank customers
- C. Not mark files or documents with privileged and Confidential: Attorney-Client Privilege and/or Work-Product.
Those marks will only encourage law enforcement or opposing attorneys to seize those files - D. Request formal company authorization to conduct the investigation. Such authorization should be granted, if possible, by the board of directors or audit committee
Answer: D
NEW QUESTION 174
A school teacher recently opened a private banking account with a major bank. The customer indicated annual income of EUR 45,000 and listed her source of wealth as a EUR 1.5 million inheritance from relatives. The customer plans to invest EUR 12,000 to 15,000 earned annually from bearer bonds. The relationship manager verified the client's identity and documented all of the above information in the account file before opening the account. During a routine review of the account, several electronic fund transfers in excess of EUR 5 million each were made from a diamond distributor. The relationship manager also noticed that in each instance, the customer immediately transferred the funds to bank accounts in Hong Kong. Which of the following is appropriate for the anti-money laundering specialist to recommend?
- A. Investigate the source and purpose of the transactions.
- B. Suspend further customer transactions through the bank.
- C. Arrange a meeting between the customer and legal department.
- D. Contact the competent authority and local law enforcement.
Answer: A
NEW QUESTION 175
A bank employee reviews wire transactions looking for indications of wire stripping.
Which two actions should the employee take to complete appropriate bank procedures? (Choose two.)
- A. Identify wire transaction activity to or from a financial institution located in a higher risk jurisdiction
- B. Identify large incoming wire transactions received on behalf of a foreign client with no explicit reason
- C. Check for suspicious phrases usually used to conceal originator or beneficiary identity
- D. Compare the wire transaction as it enters and after it leaves the bank
Answer: A,B
Explanation:
Explanation/Reference: https://www.lexology.com/library/detail.aspx?g=79732c5e-b4bf-456a-9604-712f44f5a930
NEW QUESTION 176
With which person(s) should an anti-money laundering officer coordinate when implementing a new hire screening program?
- A. Local Financial Intelligence Unit
- B. Human Resources
- C. Institution's Regulator
- D. Internal Auditor
Answer: B
NEW QUESTION 177
Which three methods are commonly used by an accountant to launder money? (Choose three.)
- A. Representing a client in court
- B. Acting as a designee for someone who wishes to hide their identity
- C. Acting as a conduit for transferring cash between accounts
- D. Overstating income to hide excess cash
- E. Understating income to take a tax loss
Answer: B,C,D
NEW QUESTION 178
Which two individuals are ordinarily beneficial owners of a private banking account according to the Wolfsberg Anti-Money Laundering Principles for Private Banking? (Choose two.)
- A. Those who have legal title to a controlling share interest in the customer
- B. Those who are the ultimate source of funds for the account and whose source of wealth should be subject to due diligence
- C. Those two are authorized signers on the account
- D. Those who generally have ultimate control through ownership or other means over the funds in the account
Answer: B,D
Explanation:
Explanation/Reference: https://www.wolfsberg-principles.com/sites/default/files/wb/pdfs/wolfsberg-standards/10.%
20Wolfsberg-Private-Banking-Prinicples-May-2012.pdf (2)
NEW QUESTION 179
Which of the following poses the greatest money laundering risk for a financial institution offering on-line services to customers?
- A. Customers can directly access their accounts without being detected.
- B. There is greater difficulty in matching the customer with the provided identification documentation. B.
There is no human scrutinizing the customer's transactions, thus increasing the potential for large transactions. - C. Institutions offering on-line services have no possibility to properly verify the identity of their customers.
Answer: A
Explanation:
Explanation
Correct but still under verification
NEW QUESTION 180
What must be materially true regarding transactions for United States (U.S.) sanctions laws to have jurisdiction?
- A. Transactions are traced to illegal proceeds
- B. Transactions are processed by a U.S. person
- C. Transactions are stripped of beneficial owner information
- D. Transactions are identified as proceeds of foreign corruption
Answer: B
NEW QUESTION 181
Which action does the Financial Action Task Force (FATF) recommend be taken against jurisdictions that have strategic deficiencies?
- A. Create an action plan to address the deficiencies without the support of the FATF
- B. Conduct due diligence
- C. Add the jurisdiction to the United Nations' list of sanctioned jurisdictions
- D. Apply counter-measures
Answer: D
NEW QUESTION 182
Which statement about a multinational institution's ability to fully investigate unusual activity in all its foreign operations is correct?
- A. Local privacy and data protection laws may prevent an affiliate from sharing information.
- B. Enterprise-wide compliance oversight rules issued in the global institution's headquarters country will override any local limitations in other countries.
- C. The institution should consult with the customer and request permission to conduct a full investigation into all the accounts.
- D. Certain account documents may be stored only in local language which will prohibit a global assessment.
Answer: B
NEW QUESTION 183
Outgoing foreign transactions of similar amounts trigger a monitoring alert for a customer's accounts. During the evaluation of the accounts, the bank discovers the wire transfers were very small amounts and occurred within the last 3 months following a long period of inactivity. The wire transfers appear to originate from legal sources. To assess the potential of terrorist financing, the institution must ensure the
- A. account holder does not reside in a country included on the U.S. State Department State Sponsors of Terrorism List.
- B. beneficiaries of transfers are not included on the Transparency International List.
- C. account holder presents proof the funds are legal.
- D. beneficiaries of transfers are not on a terrorist watch list.
Answer: A
NEW QUESTION 184
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