Practice Test Geeks(RCMS) Registered Compliance Management Specialist Certification Practice Test
← All RCMS Flashcard Decks

Anti-Money Laundering & KYC Flashcards

7 cards from real RCMS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Anti-Money Laundering & KYC flashcards as text

  1. What is a Politically Exposed Person (PEP) in the context of KYC/AML?

    Answer: An individual who holds or has held a prominent public function, posing higher corruption risk

    PEPs are individuals entrusted with prominent public functions who may pose higher risks for bribery and corruption.

  2. What is the timeframe within which a financial institution must file a SAR after initially detecting a suspicious transaction?

    Answer: 30 calendar days, extendable to 60 if no suspect is identified

    SARs must be filed within 30 calendar days of detection, with a 60-day extension allowed when no suspect has been identified.

  3. Which of the following is an example of trade-based money laundering (TBML)?

    Answer: Over-invoicing goods to transfer value across borders under the guise of legitimate trade

    TBML exploits international trade transactions, such as over- or under-invoicing, to move value across borders illicitly.

  4. Under the Customer Due Diligence (CDD) rule finalized by FinCEN in 2016, what beneficial ownership threshold must be identified for legal entity customers?

    Answer: 25% or greater ownership

    The FinCEN CDD rule requires identifying natural persons owning 25% or more of a legal entity customer.

  5. What distinguishes Enhanced Due Diligence (EDD) from standard CDD?

    Answer: EDD involves deeper scrutiny of higher-risk customers, including PEPs and high-risk jurisdictions

    EDD requires additional information and ongoing monitoring for customers or relationships presenting higher AML risks.

  6. Which international body sets the global standard for AML/CFT compliance frameworks?

    Answer: Financial Action Task Force (FATF)

    FATF is the inter-governmental body that develops and promotes policies to protect the global financial system from money laundering and terrorist financing.

  7. What is 'de-risking' in the context of AML compliance?

    Answer: Financial institutions terminating relationships with entire customer categories deemed high-risk

    De-risking refers to the practice of financial institutions exiting entire categories of customers or business lines to avoid AML compliance burdens.