Exam Questions and Answers for CAMS Study Guide Questions and Answers!
Certified Anti-Money Laundering Specialists Certification Sample Questions and Practice Exam
NEW QUESTION # 109
Which three areas do FATF's 40 recommendations cover? Choose 3 answers
- A. International Cooperation
- B. Financial systems and their regulation
- C. The criminal justice system
- D. Prescriptive sentences for predicate offenses
Answer: A,B,C
Explanation:
Explanation
The 40 Recommendations provide a complete set of countermeasures against money laundering and terrorist financing, covering
* the identification of risks and development of appropriate policies;
* the criminal justice system and law enforcement;
* the financial system and its regulation;
* the transparency of legal persons and arrangements; and
* international cooperation.
NEW QUESTION # 110
Which action does the Financial Action Task Force (FATF) recommend be taken against jurisdictions that have strategic deficiencies?
- A. Add the jurisdiction to the United Nations' list of sanctioned jurisdictions
- B. Apply counter-measures
- C. Conduct due diligence
- D. Create an action plan to address the deficiencies without the support of the FATF
Answer: B
Explanation:
Reference: http://www.fatf-gafi.org/publications/high-risk-and-ot
her-monitored-jurisdictions/documents/publicstatement-october-2018.html
"Countries can be subject to comprehensive or targeted sanctions. Comprehensive sanctions prohibit virtually all transactions with a specific country. Targeted sanctions prohibit transac-tions with specified industries, entities or individuals listed on OFAC's Specially Designated Nationals and Blocked Parties List. Failure to comply may result in criminal and civil penalties. FATF also maintains a list of jurisdictions identified as high-risk and noncooperative, whose AML/CFT regimes have strategic deficiencies and are not at international standards. As a result, FATF calls on its members to implement COUNTERMEASURES against the jurisdiction, such as financial institutions applying enhanced due diligence to business relationships and transactions with natural and legal persons from the identified jurisdiction in an attempt to persuade the jurisdiction to improve its AML/CFT regime."
NEW QUESTION # 111
Following a recent exercise which explained how a correspondent banking operation could be used by money launderers, an anti-money laundering specialist decided to re-write the due diligence procedures for entering into agreements with foreign financial institutions. Which of the following information should be included to establish a rigorous "Know Your Respondent" procedure?
1.Respondent's management, nature of license, and major business activity.
2. Computer equipment and software capability.
3. The quality of supervision in the home country.
4. Respondent's location, in particular the existence of a real physical presence.
- A. 1, 2, and 3 only
- B. 1, 2, and 4 only
- C. 2, 3, and 4 only
- D. 1, 3, and 4 only
Answer: B
NEW QUESTION # 112
According to the European Union Money Laundering Directives, "knowledge, intent or purpose"' required as an element for money laundering may be inferred from
- A. Subjective factual circumstances.
- B. Objective non-factual circumstances.
- C. Objective factual circumstances.
- D. Subjective non-factual circumstances.
Answer: C
NEW QUESTION # 113
Which safeguard is in place for Financial Intelligence Units (FIUs) to share information securely according to Egmont?
- A. A computer with access to the Egmont Secure Web is accessible to all members of the FIU.
- B. Information sharing is conducted according to processes contained in Memoranda of Understanding.
- C. Investigators are allowed to request information from a foreign FIU directly.
- D. Intelligence is shared via messaging applications.
Answer: A
NEW QUESTION # 114
Which are red-flag indicators of possible money laundering through online gambling? (Choose two.)
- A. The player deposits small amounts of funds into their online gambling account.
- B. The customer uses their credit card to fund an online gambling account.
- C. The customer logs on to the account from multiple countries.
- D. The player opens several accounts under the same name using different IP addresses.
- E. The player is identified as a Politically Exposed Person (PEP).
Answer: A,C
NEW QUESTION # 115
The USA PATRIOT Act requires United States (U.S.) financial institutions to collect certain information from non-U.S. banks that hold a correspondent account.
Which two pieces of information must a non-U.S. bank provide to its U.S. correspondent to enable them to comply with this requirement? (Choose two.)
- A. Prompt notice of any suspicious activity it detects on any customer who uses the correspondent account
- B. The name and address of all shell banks the bank maintains accounts for
- C. The name and address of a U.S. person who is authorized to receive service of legal process for the bank
- D. The name and address of all beneficial owners who own 25% or more of the bank
Answer: A,D
Explanation:
Explanation/Reference: https://www.sec.gov/about/offices/ocie/amlsourcetool.htm
NEW QUESTION # 116
Why are Money Services Business (MSBs) frequently accused of being high risk for money laundering?
- A. MSBs are subject to regulatory scrutiny which varies greatly from country to country
- B. MSBs can route funds to more high risk countries than banks
- C. MSBs generally charge lower commission rates than banks charge making them attractive to criminals
- D. A MSB should be used to hide money from a regulated entity
Answer: C
NEW QUESTION # 117
Which statement describes the relationship between the internal audit function and compliance?
- A. In order to maintain independence, the auditors should not discuss internal audit findings with compliance management
- B. The internal audit methodology should include an assessment of compliance risk
- C. An internal audit program of the adequacy of the bank's compliance function should be established, but should not include review of transactions
- D. The compliance function and internal audit function should be combined
Answer: B
NEW QUESTION # 118
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 Financial Action Task Force's PEP Hotline
- B. The board of directors
- C. The line of business executive
- D. The bank's anti-money laundering officer
Answer: D
NEW QUESTION # 119
Which information must a United States financial institution retain for having foreign correspondent accounts as part of the USA PATRIOT Act record keeping requirements?
- A. A suspicious activity report filed and the supporting documentation involving foreign correspondent accounts
- B. Section 314(b) information sharing results related to foreign correspondent accounts
- C. Purchase of monetary instruments of $3,000 or more involving foreign correspondent accounts
- D. Records identifying the owners of each foreign bank
Answer: B
Explanation:
Explanation/Reference: https://www.moneylaunderingnews.com/2017/10/aml-information-sharing-in-the-u-s/
NEW QUESTION # 120
A compliance officer is conducting a review of the automated transaction monitoring system. What would be most likely to result in a change in the monitoring system parameters?
- A. The national Financial intelligence Unit issues new risk indicators
- B. Law enforcement issues a subpoena for a particular customer's account records
- C. The institution's creditworthiness thresholds change
- D. The local paper runs stories that sully the institution's reputation in the marketplace
Answer: A
NEW QUESTION # 121
What are three potential issues for foreign financial institutions maintaining correspondent accounts with U.S.
banks under the Patriot Act? Choose 3 answers
- A. Prohibition of correspondent accounts for shell banks
- B. Forfeiture of funds in a U.S. interbank account
- C. Cancellation of correspondent banking relationships
- D. U.S. residents maintaining private banking accounts
Answer: A,B,C
Explanation:
Reference: http://www.ffiec.gov/bsa_aml_infobase/p
NEW QUESTION # 122
Which three are best practices for embedding compliance into an institution's culture? Choose 3 answers.
- A. Requiring senior management oversea and implement the institution's AML policy
- B. Having the Compliance Officer review and approve the institution's AML policy
- C. Requiring periodic and on-going training on AML issues and procedures
- D. Incorporating compliance with the institution's AML policy into the annual evaluation process
Answer: B,C,D
NEW QUESTION # 123
Which two statements are true regarding the European Union Money Laundering Directives? (Choose two.)
- A. They set forth non-binding best practices for financial institutions within the member states
- B. They have extraterritorial impact and apply to states that have diplomatic relations with member states
- C. They require member states to enact laws and/or regulations to comply with the directives
- D. They apply to member states of the European Union
Answer: C,D
NEW QUESTION # 124
A bank compliance officer has implemented enhanced monitoring rules that have identified some unusual activity that may be indicative of human trafficking.
Which red flag should prompt additional transactional review?
- A. Cash deposits that occur in cities where the customer does not reside or conduct business followed by same-day withdrawals
- B. Cash deposits that occur in cities where the customer resides and conducts business
- C. Wire transfer activity from countries with significant migrant populations
- D. Cash deposits that occur in cities where the customer does not reside or conduct business
Answer: A
NEW QUESTION # 125
The main purpose of the US Treasury Department for OFAC's extraterritorial reach is to:
- A. protect allied nations of the US from the economic threats of non-allied nations.
- B. accomplish the foreign policy and national security goals of the US.
- C. align OFAC's and other countries' extraterritorial reach requirements.
- D. defend the US against questionable trade practices of its economic rivals.
Answer: B
Explanation:
Reference:
https://www.natlawreview.com/article/aggressive-extraterritorial-reach-us-economic-sanctions-foreign-company
NEW QUESTION # 126
In which type of banking transaction is price manipulation, as a form of money laundering, a common practice?
- A. Subscribing to a cash management account
- B. Issuing a letter of credit
- C. Redeeming an annuity
- D. Sending a wire transfer
Answer: B
NEW QUESTION # 127
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. Compare the wire transaction as it enters and after it leaves the bank
- B. Check for suspicious phrases usually used to conceal originator or beneficiary identity
- C. Identify large incoming wire transactions received on behalf of a foreign client with no explicit reason
- D. Identify wire transaction activity to or from a financial institution located in a higher risk jurisdiction
Answer: C,D
Explanation:
Explanation/Reference: https://www.lexology.com/library/detail.aspx?g=79732c5e-b4bf-456a-9604-712f44f5a930
NEW QUESTION # 128
Which three definitions of money laundering are included in the expanded definition of the European Union Fourth Directive? (Choose three.)
- A. Concealing or disguising the nature, source, location, disposition, movement, rights with respect to, or ownership of property, knowing that the property is derived from criminal activity
- B. The creation of shell companies to disguise the identity of its owners
- C. The acquisition or use of property knowing, when it was received, that it was derived from criminal activity
- D. The transfer of cash in excess of 15,000 euros across country borders regardless of whatever the cash was derived from criminal activity
- E. The conversion or transfer of property with knowledge that it is derived from criminal activity
Answer: A,C,E
Explanation:
Explanation/Reference: https://books.google.com.pk/books?id=CMixCwAAQBAJ&pg=PA344&lpg=PA344&dq=european
+4th+directive+Concealing+or+disguising+the+nature,+source,+location,+disposition,+movement,+rights+with
+respect+to,+or+ownership+of+property,+knowing+that+the+property+is+derived+from+criminal
+activity&source=bl&ots=nOUQRszJ6_&sig=ACfU3U1NigFiOY5Zkj30B9FlPI1UhyUMEg&hl=en&sa=X&ved=2a hUKEwibgbi9op3oAhVPfH0KHV0wBXoQ6AEwAHoECBIQAQ#v=onepage&q=european%204th%20directive%
20Concealing%20or%20disguising%20the%20nature%2C%20source%2C%20location%2C%20disposition%
2C%20movement%2C%20rights%20with%20respect%20to%2C%20or%20ownership%20of%20property%2C
%20knowing%20that%20the%20property%20is%20derived%20from%20criminal%20activity&f=false
NEW QUESTION # 129
Which of the following is the most likely reason for the Financial Action Task Force to remove a jurisdiction from the Non-Cooperative Countries and Territories list?
- A. Entering into a mutual legal assistance treaty.
- B. Conducting successful annual self-assessments.
- C. Receiving a favorable mutual evaluation.
- D. Joining the Wolfsburg Group.
Answer: A
NEW QUESTION # 130
What reputational risk consequence could a financial entity face for violating AML laws?
- A. Loss of high-profile customers
- B. Increased audit costs to monitor behavior
- C. Monetary penalties
- D. Seizure of assets
Answer: C
Explanation:
Reference:https://www.ifc.org/wps/wcm/connect/e7e10e94-3cd8-4f4c-b6f8-1e14ea9eff80/45464_IFC_AML_Re
NEW QUESTION # 131
What are three elements of a sound Customer Due Diligence Program?
- A. Determination of what type of customer the financial institution will accept
- B. Obtaining date of birth and address of a prospective customer
- C. Determination of who in the institution should be assigned to the prospective customer as a liaison
- D. Training as to how and to what extent to identify prospective customers
Answer: A,B,D
NEW QUESTION # 132
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Career Opportunities
Individuals who have obtained the CAMS designation may receive a range of benefits. They include furthering one's professional portfolio via demonstrating a better understanding of the detection and prevention techniques of financial crime, helping to protect their organization from money laundering threats, and lessening financial crime risks. What's more, by flaunting this qualification on your resume, you can opt for such job roles as an Anti-Money Laundering Analyst, Bank Secrecy Act (BSA) Officer, Staff Auditor, Management Consultant, etc. When it comes to the annual payment received by those specialists who got CAMS certified, it equals almost $82k per year as shown by Payscale.com.
The Certified Anti-Money Laundering Specialist (CAMS) certification is a globally recognized credential for professionals working in the anti-money laundering (AML) field. The CAMS exam is designed to test a candidate's knowledge and understanding of AML laws, regulations, and best practices. It is one of the most prestigious certifications in the AML industry, and it is highly valued by employers and regulatory agencies around the world.
To become CAMS certified, candidates must pass a rigorous examination that tests their knowledge and skills in the field of AML/CTF. CAMS exam consists of 120 multiple-choice questions and is timed at four hours. Candidates must achieve a minimum score of 75% to pass the exam. Once certified, CAMS professionals are required to maintain their certification by earning 60 continuing education credits every three years to ensure that they stay up to date with the latest developments in the field.
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