ACAMS General Practice 3

Question 1

Under the FinCEN Customer Due Diligence rule, which of the following must be identified for legal entity customers opening accounts at covered financial institutions?

Accepted Answer

Beneficial owners who own 25% or more and a single person with significant control

Answer

The company's credit score and debt-to-equity ratio

Answer

All employees who have signature authority over the account

Answer

The company's three most recent audited financial statements

Question 2

Which red flag is most associated with trade-based money laundering (TBML)?

Accepted Answer

Over- or under-invoicing of goods and services in international trade transactions

Answer

A customer requesting a wire transfer to a FATF-compliant jurisdiction

Answer

A business customer depositing revenue consistent with its industry

Answer

Requesting online banking access for a new business account

Question 3

An AML officer discovers that a compliance program has not been updated since 2019 and lacks risk-based controls. What is the most immediate priority?

Accepted Answer

Conduct a gap analysis and present findings to senior management for remediation

Answer

File a SAR with FinCEN to disclose the program deficiency

Answer

Notify all customers of the compliance program weakness

Answer

Suspend all new account openings until the program is updated

Question 4

Under OFAC regulations, what does 'blocking' a transaction mean?

Accepted Answer

Freezing assets or funds associated with sanctioned parties so they cannot be moved

Answer

Delaying a transaction pending additional customer documentation

Answer

Returning funds to the originating party without processing

Answer

Reporting the transaction to the IRS for tax investigation

Question 5

Which of the following is the most effective method for identifying money laundering in correspondent banking relationships?

Accepted Answer

Conducting due diligence on the respondent bank's AML program and monitoring nested accounts

Answer

Reviewing the respondent bank's website for compliance information

Answer

Limiting the relationship to domestic wire transfers only

Answer

Requiring the respondent bank to file SARs in the home country

Question 6

What is the key difference between a SAR and a CTR?

Accepted Answer

CTRs are triggered by transaction amounts while SARs are triggered by suspicious activity

Answer

CTRs are filed voluntarily while SARs are mandatory

Answer

SARs are submitted to the IRS while CTRs go to FinCEN

Answer

CTRs require law enforcement approval before filing

Question 7

Which FATF recommendation addresses the risk-based approach to AML/CFT?

Accepted Answer

Recommendation 1

Answer

Recommendation 5

Answer

Recommendation 16

Answer

Recommendation 40