Unit 25

Which of the following would require the filing of a SAR? Any transaction alone or in aggregate involving at least A) $5,000 on a single day. B) $5,000 and appears to serve no business or legal purpose. C) $3,000 and appears to serve no business or legal purpose. D) $,3000 on a single day.

B) $5,000 and appears to serve no business or legal purpose.

Which of the following is not a function of the Office of Foreign Assets Control (OFAC)? A) Prohibit broker-dealers from dealing with certain individuals and businesses B) Control the assets of U.S. broker-dealers in foreign countries C) Block assets of persons on the Specifically Designated Nationals list D) Maintain the Specifically Designated Nationals list

B) Control the assets of U.S. broker-dealers in foreign countries

A customer enters several orders in complex securities without concern on the returns or losses. This suspicious activity is most likely the result of which stage of money laundering? A) Integration B) Layering C) Placement D) Structuring

B) Layering

A bank employee has noticed that one of its customers has deposited $9,000 in his account every Monday, Wednesday and Friday for the past four weeks. Though the action could be legitimate, the customer might be trying to circumvent which of the following? A) The Maloney Act B) The Bank Secrecy Act C) The Securities Exchange Act D) The Trust Indenture Act

B) The Bank Secrecy Act

An officer of a financial firm has identified what might represent suspicious behavior on the part of a customer, involving more than $5,000. When must the firm file a suspicious activity report (SAR)? A) By the end of the business day B) Within 30 calendar days C) Within 180 calendar days D) Within 5 business days

B) Within 30 calendar days

Records relating to a Currency Transaction Report (CTR) must be retained for A) six years. B) five years. C) three years. D) four years.

B) five years.

Under the USA PATRIOT Act, financial firms must create and maintain records of wire transfers only A) to bank customers. B) of $3,000 or more. C) to retail investors. D) to a different state.

B) of $3,000 or more.

Firms must file a SAR within how many days of becoming aware of a suspicious transaction? A) 10 days, and they are prohibited from notifying the customer involved that a report has been filed B) 10 days, and they are required to notify the customer involved that a report has been filed C) 30 days, and they are prohibited from notifying the customer involved that a report has been filed D) 30 days, and they are required to notify the customer involved that a report has been filed

C) 30 days, and they are prohibited from notifying the customer involved that a report has been filed

If a broker-dealer suspects that a transaction involves funds derived from illegal activity, a suspicious activity report (SAR) would be triggered at what threshold? A) At least $10,000 in funds or other assets B) More than $5,000 in funds or other assets C) At least $5,000 in funds or other assets D) More than $10,000 in funds or other assets

C) At least $5,000 in funds or other assets

Financial institutions such as broker-dealers must report when there is an event, transaction, or series of events or transactions that appear to be questionable to A) FBI. B) Securities and Exchange Commission (SEC). C) FinCEN. D) Financial Industry Regulatory Authority (FINRA).

C) FinCEN.

Which of the following is the first stage in the money laundering process? A) Layering B) Integration C) Placement D) Initiation

C) Placement

All of the following are stages of money laundering except A) placement. B) integration. C) diversification. D) layering.

C) diversification.

A customer wishes to deposit $20,000 in cash into her account. This requires A) written verification of the source of funds. B) filing a SAR with FinCEN. C) filing a CTR with FinCEN. D) principal approval.

C) filing a CTR with FinCEN.

All of the following are stages of money laundering except A) integration. B) layering. C) initiation. D) placement.

C) initiation.

The process of making money that appears to have come from legal activities when it in fact it came from illegal activities is called A) placement. B) layering. C) money laundering. D) integration.

C) money laundering.

An AML compliance officer should do all of the following except A) insure the firm is meeting all requirements of the Bank Secrecy Act for opening new accounts. B) monitor compliance with all BSA requirements at the firm. C) notify customers immediately when an SAR is being filed. D) insure the firm is properly training employees on the requirements of the BSA.

C) notify customers immediately when an SAR is being filed.

A customer who tries to disguise deposits of more than $10,000 in currency by making multiple smaller deposits in currency is guilty of A) integration. B) placement. C) structuring. D) layering.

C) structuring.

Deposits received in currency for amounts over $10,000 in a day would require the firm to report the transaction in how many days on what form? A) SAR within 30 days B) CTR within 30 days C) SAR within 15 days D) CTR within 15 days

D) CTR within 15 days

The bureau of the Treasury Department that combats money laundering and international and domestic terrorist financing is called A) the SAR. B) the ATF. C) the Comptroller of the Currency. D) FinCEN.

D) FinCEN.

What is the final stage of money laundering? A) Placement B) Layering C) Initiation D) Integration

D) Integration

Which of the following publishes and maintains a list of known terrorists and drug traffickers and those controlled by them or acting on their behalf? A) The Financial Crimes Enforcement Network (FinCEN) B) The Federal Open Market Committee (FOMC) C) The Financial Industry Regulatory Authority (FINRA) D) The Office of Foreign Assets Control (OFAC)

D) The Office of Foreign Assets Control (OFAC)

Suspicious activity reports (SARs) are A) filed with the Securities and Exchange Commission (SEC) as required by the Securities Exchange Act of 1933. B) filed internally only for analysis involving potential problematic patters. C) filed with Financial Industry Regulatory Authority (FINRA) as required by FINRA's code of conduct. D) filed to the Financial Crimes Enforcement Network (FinCEN) as required by the USA PATRIOT Act.

D) filed to the Financial Crimes Enforcement Network (FinCEN) as required by the USA PATRIOT Act.

The Specifically Designated Nationals (SDN) list must be checked A) prior to each trade in an account. B) prior to distribution of dividends and interest. C) prior to settlement of each trade. D) when opening a new account for an individual or other entity.

D) when opening a new account for an individual or other entity.

Which of the following would require the filing of a suspicious activity report (SAR)? A) Any transaction alone or in aggregate involving at least $5,000 and appears to serve no business or legal purpose. B) Any transaction alone or in aggregate involving at least $5,000 on a single day. C) Any transaction alone or in aggregate involving at least $3,000 on a single day. D) Any transaction alone or in aggregate involving at least $3,000 and appears to serve no business or legal purpose.

A) Any transaction alone or in aggregate involving at least $5,000 and appears to serve no business or legal purpose.

The USA PATRIOT Act's required Customer Identification Program is designed chiefly to prevent I. real estate fraud. II. funding of terrorist activities. III. use of insider information. IV. money laundering. A) II and IV B) I and III C) II and III D) I and IV

A) II and IV

Money laundering activities are most easily caught during which phase? A) Placement B) Layering C) Structuring D) Integration

A) Placement

Which of the following acts deals with money laundering? A) The PATRIOT Act B) The Securities Exchange Act of 1934 C) The Securities Act of 1933 D) The Securities Investor Protection Act of 1970

A) The PATRIOT Act

Those who look to hide money from government agencies and law enforcement to avoid the payment of taxes or to fund criminal enterprises often look to launder money in the following order: A) placement, layering, integration. B) placement, integration, layering. C) integration, layering, placement. D) layering, placement, integration.

A) placement, layering, integration.