AML Exam 2
C
According to the EU directives an independent legal professional is obligated to report suspicion of money laundering and a client relationship when_______ a. Representing a client in a legal matter b. Ascertaining the legal position for a client c. Participating in financial or corporate transactions d. Obtaining information associated with a judicial proceeding
C
All of the following are changes made in the Fourth European Union Money Laundering Directive except: a. Applying customer due diligence for transfer of funds exceeding EUR 1,000 b. Applying enhanced due diligence to PEPs irrespective of domestic or third country citizenship status c. Increasing the threshold of entities obliged to report suspicious transaction from EUR 10,000 to 15,000 d. Increasing the scope of obliged entities from just casinos to include all providers of gambling services
B
All of the following statements related to actions of the Pffice of Foreign Assets Control are true, except: a. Imposition of economic and trade sanctions based on US foreign policy b. Restriction of travel by US citizens to certain countries based on sanctions lists that OFAC issues periodically c. Freezing or blocking of foreign assets of persons and organizations under US jurisdiction d. Imposition of significant penalties on those who are found to be in violation
D
And most money laundering international standards it is stated that _____ a. Financial institutions are not responsible for money laundering or suspicious transactions taking place within their accounts until the government places the customer on a watchlist b. Informing customers from their accounts and or transaction or the subject of an AML investigation is not punishable c. The dirty money undergoing money laundering will not be confiscated because of privacy laws d. The institution should identify the beneficial owners of the account
b
Does the USA PATRIOT Act have any international impact or ramifications? a. No b. Yes
A,C
Egmont training group published FIUS in an action 100 same tonight cases which two of the items noted below we listed in the report as part of the six most frequent indicators of money money? a. Defensive stance to questioning b. Use of precision stones for moving value c. Unrealistic wealth compared to client profile d. Significant use a prepaid credit cards
C
FATF fulfills it's started objectives by monitoring implementation of the FATF Recommendations among its members through _______ & _______ a. Risk assessment; compliance assessment b. International cooperation; law enforcement c. Compliance assessment; effectiveness assessment d. Technical compliance assessment; institutional framework assessment technical
A
FATF is currently comprised of 35 member jurisdiction and 31 associate members or observers. a. True b. False
a
FATF's 40 Recommendations provide a complete set of countermeasures against money laundering, including special recommendations in terrorist financing a. True b. False
A,B,D
FinCEN's advisory to US financial institutions on promoting a culture of compliance published in 2014 listed six areas up and assess which three areas are included in that list? a. Leader ship should be engaged b. Information should be shared throughout the organization c. Leader ship and staff should understand how their BSA reports are used d. The organization must have an appropriately qualified compliance officer
a
For banks, the Wolfsburg group papers are just recommendation. They do not have the force of law a. True b. False
B,C,D
Identify three key aspects of OFAC sanctions that have extraterritorial reach. a. Restricting travel by US citizens to certain countries b. Economic and trade sanctions based on US foreign-policy c. Freezing foreign assets under US jurisdiction d. Blocking people on the specially designated nationals and blocked persons list
B,C,D
Identify tree key roles of regional FATF style bodies a. Writing the FATF 40 recommendations b. Publishing periodic typology reports c. Actively participating In identifying AML technical assistance needs d. Assisting in the FATF mutual evaluation process
A,B,D
In 2014, the Wolfsburg Group published its Anti-Money laundering principles for correspondent banking. which three of the following elements are recommended to be included in the due diligence of a correspondence banking client? a. The geographic risk b. Ownership and management structure c. The resume of the compliance officer d. The customer base
A,C,D
In its paper on Customer Due Diligence of Banks Committee emphasized what three things? a. customer acceptance b. prohibition against opening accounts for PEPs c. ongoing monitoring of high-risk accounts d. customer identification
A,B,D
Section 311 of the Act provides for the potential designation of what three kinds of "primary money laundering concern" a. Foreign account b. Foreign transaction c. Foreign politically exposed person d. Foreign jurisdiction
a
Section 311 of the USA PATRIOT Act provides the US Treasury Department with the authority to obtain info on the beneficial of any account opened in the Us by foreigns a. True b. False
A,B,D
The Annex IV General guide to account opening consultative document published in February 2016 by the Basel committee lists information that should be obtained for the identification of legal person which three items are recommended? a. Name, legal forms, status and proof of incorporation of the legal person b. Permanent address of principal place of the legal persons activities c. A report describing a visit by the account officer to the principal place of business d. Identity of natural persons who have authority to operate the account and who exercise control of the legal person through ownership or other means
B
The Basel Committee has observed that without due diligence, banks can be subject to social, operational, legal, and economic risks a. True b. False
B
The Basel Committee's part on "Customer Due Diligence for Banks" specifies that the four key elements of a KYC program are: 1. customer identification 2. risk mitigation 3. employee training 4. geographic diversification
a
The European Directives have the force of law within the EU? a. True b. False
C
The European Unions First EU Directive focused primarily on what issue? a. Terrorist financing b. Structuring c. Drug trafficking d. Casinos
C
The FATF 40 Recommendstions are organized into seven groups. All of the following are valid FATF 40 Group names except: a. Financial and non-financial institution preventative measures b. Powers and responsibilities of competent authorities and other instructional measures c. International cooperation and economic sanctions d. Money laundering and confiscation
b
The Financial Action Task Force is best known for what? a. passing EU-Wide laws and policies on AML b. issuing AML/CTF recommendations for countries to follow c. having several subgroups d. establishing the definition of counter terrorist financing
B
The Fourth directive decreed that customer due diligence was to be applied for transfers of funds exceeding EUR 10,000 a. True b. False
a
The IMF and the World Bank have started requiring countries that received aid to implement effective AML programs. a. true B. False
A,C,D
The United Nations Palermo Convention expanded on the Vienna Convention by doing what three things? a. expanding the scope of when identification and confiscation of the proceeds of crime should be used b. expanding the number of elements making up the definition of money laundering c. expanding the coverage of the convention to include issues other than drug trafficking d. expanding the coverage of the convention to include organized crime
B
The Wolfsburg Group aims to promote the establishment and the operational autonomy of FIU's especially in areas with an AML/CFT program in the early stages of development. a. True b. False
B
The Wolfsburg Group was formed to provide a forum for Financial Intelligence Units around the world to improve cooperation in the fight against money laundering and financing of terrorism. a. True b. False
B
The ____ is an association of 13 global banks that aims to develop financial services industry standards and guidance related to KYC, AML, and counter-terrorist financing policies a. Egmont group b. Wolfsburg group c. International Monetary Fund d. Basel Committee on Nanking supervision
a
The office of foreign assets control is allowed to impose sanctions against certain foreign countries. a. true b. False
a
The third EU Directive defined "money laundering" and "terrorist financing" as separate crimes. a. True b. False
B
There are ten FATF-style regional bodies that have similar form and functions to those of FATF. a. True b. False
A,B,C
What are three suggestions articulated by FATF? a. That is appropriate to have good customer die Dillinger earth procedures b. That it is appropriate to require suspicious activity reporting c. That it is appropriate to criminalize money laundering and the financing of terrorism d. That it is important to never allow numbered accounts
c
Which of the following is not a component/element of the KYC program specified In the paper? a. Customer identification b. Risk management c. Employee training d. Monitoring
A
Which of the following is the most difficult regulatory challenge facing a foreign financial institution with a corresponding banking relationship in the US? a. USA Patriot act b. Basil due diligence principles for banks c. FATF Guidance on terrorist financing d. UN Security Council resolution on correspondent banking
C
Which of the following sections of the USA PATRIOT Act prohibits US banks and securities brokers and dealers from maintaining correspondent accounts? a. Section 319 (a) b. Section 312 c. Section 313 d. Section 319 (b)
A,B,C
Which of the following should a national legislator consider when criminalizing money laundering in the line with the CFATF 19 recommendations? a. Defining money laundering based on the model laws issued by the organization of American states b. Permitting forfeiture in all cases following conviction c. Indicating whether it is relevant that a predicate occurrence may have been committed outside the local jurisdiction d. Requiring money laundering offenses to prove that the offender has actual knowledge of a criminal connection to the funds
A
Which of the following statements is true? a. The egmont group membership comprises national FIUs b. The Wolfsburg Group membership compromises central bank governors of the G10 c. The European Union recommends legislation to be passed in the member countries d. The Basel committee levies levies on the member countries for non-compliance with AML laws
D
Which one of the following statements is correct and respect of the FATF 40 recommendations? Counties should ______ a. Not allow bearer shares in legal person shooter able to issue bearer shares b. Gather statistics on us to yours prosecutions and convictions on frozen property seized and confiscated c. Consider the feasibility of a system in which banks and other financial institutions and intermediaries would report currency transactions without indicating a minimum fixed amount d. Not approved the establishment or excepted continued operation of shell banks
C
Which statement is true in respect to the Wolfsburg group? a. It is a castle in Belgium more members of national FIU's meet to monitor global AML trends b. This group is responsible for making international lost to come on anti-money laundering in counter terrorist financing c. The major international banks me in this group to double guidelines for anti-money laundering in counter terrorist financing d. The governors of central banks meeting this group to discuss a little transit anti-money-laundering
B,C,D
Which three of the following statements are true and respect to the fourth EU anti-money laundering directive? a. Member countries can decide when and if they incorporate it into their local laws b. It repeals and replaces the third EU directive on anti-money laundering c. Each members country must hold beneficial ownership information in a central registry and it must be made available to competent authorities d. The definition of a PEP is expanded to include domestic persons
A,C,D
Which three statements are true about the fourth EU directive on money laundering? a. It updates European community legislation to be further in line with the financial action task force 40 recommendations b. It repeats the definition of a politically exposed person in previous directives c. It repeats from the customer and due diligence requirements of the previous director's but adds more detail to the requirements by for example including a specific requirement to identify the beneficial owner and includes ongoing monitoring requirements d. It includes new definitions for correspondent relationships and senior management