ACAMS ACAMS Certifications CAMS-FCI Questions & Answers

• Question 21:

  Which most likely indicates that a business email compromise attack has occurred?

  A. A company sends a recurring payment to a new account number.

  B. A company sends a larger-than-normal check to an existing supplier.

  C. A company adds a new employee as an authorized signer.

  D. A company has a new beneficial owner.

  Correct Answer: A

  When writing or reviewing a SAR/STR, it is important to ensure that the narrative is kept to the point; easy to read; and addresses the who, what, when, where, why, and how. This is because the narrative is the most crucial part of the SAR/

  STR, as it provides a clear and concise summary of the suspicious activity or transaction that triggered the report. The narrative should include all the relevant information that would help law enforcement or regulators to understand the nature

  and context of the activity or transaction, such as123:

  The who: The names, addresses, account numbers, and other identifying information of the parties involved in the activity or transaction, such as customers, beneficiaries, intermediaries, or third parties.

  The what: The type, amount, frequency, and purpose of the activity or transaction, such as cash deposits, wire transfers, check payments, or purchases of goods or services.

  The when: The date, time, and duration of the activity or transaction, and whether it was a one-time occurrence or part of a pattern or trend. The where: The location or channel of the activity or transaction, such as branches, ATMs, online

  platforms, or mobile applications. The why: The reason or rationale for the activity or transaction, and why it was considered suspicious or unusual based on the customer's profile, behavior, or expected activity.

  The how: The method or mechanism of the activity or transaction, such as cash, check, debit card, credit card, cryptocurrency, or prepaid card.

  References:

  How to write the perfect "Suspicious Activity Reports" (SAR)? | i-AML Writing for Prosecution: Best Practices For Composing SAR Narratives That Assist Prosecutors | ACAMS

  SAR Writing Examples and Proper Formatting: Write for Your Reader - Alessa

• Question 22:

  A retail bank prepares a yearly AML risk assessment. Which inherent risk factor is likely the most relevant?

  A. The provision of remote check deposit services

  B. The provision of cash services

  C. The provision of payable through accounts

  D. The provision of brokerage services

  Correct Answer: B

  Retail banks typically have a high inherent risk of money laundering due to their provision of cash services. This is because cash is a preferred medium of exchange for criminals and terrorists, and retail banks provide a convenient way for them to move large sums of money without detection. Retail banks are also vulnerable to money laundering through the use of false identities and other deceptive practices. (CAMS Manual, 6th Edition, Page 8).

• Question 23:

  Which statement most accurately characterizes the methods used by transnational criminal organizations?

  A. They are unlikely to associate with known terrorist organizations due to the reputational risks.

  B. They are likely to specialize in one particular method and continue to refine that method to escape detection.

  C. They routinely engage in many different types of criminal activities as long as they think it will benefit them.

  D. They see each other as competitors and rarely cooperate.

  Correct Answer: C

  The statement that most accurately characterizes the methods used by transnational criminal organizations is that they routinely engage in many different types of criminal activities as long as they think it will benefit them ? This is because transnational criminal organizations are flexible and adaptable, and they exploit opportunities and vulnerabilities in different markets and jurisdictions. According to ACAMS2, "Transnational criminal organizations are involved in a wide range of illicit activities, such as drug trafficking, human trafficking, arms trafficking, money laundering, cybercrime, environmental crime, fraud, corruption, and terrorism" (p. 3). They also "operate across borders and regions, using complex networks and structures to evade detection and prosecution" (p. 3). The other statements are not as accurate or comprehensive as option C. Transnational criminal organizations are unlikely to associate with known terrorist organizations due to the reputational risks (A) is false, as transnational criminal organizations may collaborate or cooperate with terrorist organizations for mutual benefit or convenience, such as sharing resources, routes, or contacts. Transnational criminal organizations are likely to specialize in one particular method and continue to refine that method to escape detection (B) is false, as transnational criminal organizations may diversify or change their methods depending on the circumstances or opportunities, such as shifting products, markets, or modus operandi. Transnational criminal organizations see each other as competitors and rarely cooperate (D) is false, as transnational criminal organizations may form alliances or partnerships with other criminal groups for strategic or tactical reasons, such as sharing information, expertise, or influence. Reference: ACAMS Transnational Organized Crime eLearning Course Module 1: Introduction to Transnational Organized Crime

• Question 24:

  An unusual spike in activity has occurred for a customer who is a supplier of aviation parts to a military force. The customer's current line of business is consistent with the banks records, and no adverse media hits have occurred. Which is the best reason for an investigator to continue an investigation?

  A. The end-user is a military force.

  B. There are no adverse media hits.

  C. The customer is a supplier of aviation parts.

  D. The current line of business is consistent with the bank's records.

  Correct Answer: A

  The best reason for an investigator to continue an investigation is that the end-user is a military force. This is because supplying aviation parts to a military force may involve sanctions risk, export control risk, or human rights risk, depending on the nature and destination of the military force. The investigator should conduct further due diligence to determine if the customer is complying with the relevant laws and regulations, and if the bank is exposed to any reputational or legal risk by providing services to the customer.

  References:

  Former Airline Employee and Aircraft Part Sellers Charged in Kickback ... Former Airline Employee and Aircraft Part Sellers Charged in Kickback ... Former airline employee and aircraft part sellers charged in kickback ...

• Question 25:

  SAR/STR NARRATIVE

  A SAR/STR has been submitted on five transactions conducted on the correspondent banking relationship with ABC Bank.

  Client Information:

  Remitter information: DEF Oil Resource Ltd. is the oldest member of the DEF Group. It was founded in 1977 as a general trading business with a primary focus on exports from Africa and North America. The group has business activities that span the entire energy value chain. Their core field of endeavor is centered within the oil and gas industry and its associated sub-sectors.

  Beneficiary Information: As per the response received from ABC Bank, it was determined that the beneficiaries are related to DEF Oil Resource Ltd. These were created by DEF Oil Resource Ltd. to purchase property in a foreign country on behalf of their senior management as part of a bonus scheme. The purpose behind this payment was for the purchase of property in another country.

  Payment Reference:

  ABCXXXXX31PZFG2H

  ABCXXXXXX51PQGEH

  ABCXXXXXX214QWVG

  ABCXXXXXX41PSXA2

  ABCXXXXXX815QWS3

  Concerns:

  1.

  We are unsure about the country of incorporation of the beneficiaries.

  2.

  We are concerned about the transactional activity since the payment made towards entities (conducted on behalf of individuals) appears to be possible tax evasion.

  3.

  There appears to be an attempt to conceal the identity of individuals (senior management), which again raises concerns about the source of funds.

  4.

  Referring to the response received from ABC Bank, we are unclear about the ultimate beneficiary of funds.

  5.

  The remitter is involved in a high-risk business, (i.e., oil and crude products trading), and the beneficiary is involved in real estate business which again poses a higher risk.

  While reviewing the account activity, it is noted that several transfers are sent to a company located in an offshore jurisdiction. Which step should the investigator take next?

  A. Request information from the company.

  B. File a SAR/STR to the FIU where the company is located.

  C. Request information about the beneficiaries related to the company.

  D. Conduct an open-source search to determine the ownership and registration of the company.

  Correct Answer: C

  The best step for the investigator to take next is to request information about the beneficiaries related to the company. This will help to identify the ultimate beneficial owners of the funds and the purpose of the transactions. Requesting

  information from the company or filing a SAR/STR to the FIU where the company is located may not be feasible or effective, as the company may not cooperate or the FIU may not have jurisdiction over the offshore entity. Conducting an

  open-source search may provide some information about the ownership and registration of the company, but it may not be sufficient or reliable to determine the nature and legitimacy of the transactions.

  References:

  SAR Narrative Guidance Package

  Best Practices for Drafting an STR or SAR

• Question 26:

  A new customer has just been onboarded in a securities firm. After a few weeks, there are unusual trading patterns that are being flagged. Which pattern is most concerning to the compliance officer?

  A. The customer engages in large trading in securities that are liquid or highly priced from the trading account.

  B. The customer's repeated trading in securities that are low priced and low volume counters.

  C. The customer receives many incoming wire transfers from related parties to the trading account.

  D. The customer accumulates securities of a low volume counter in small increments on a weekly basis.

  Correct Answer: D

  The most concerning trading pattern for a compliance officer when a new customer has been onboarded in a securities firm is the customer accumulating securities of a low volume counter in small increments on a weekly basis. This type of

  behavior could indicate that the customer is attempting to obscure their identity or the true purpose of their trading activity, which can be indicative of money laundering or other suspicious activity.

  (CAMS Manual, 6th Edition, Page 170).

• Question 27:

  A financial institution (Fl) receives an urgent request for information from the financial intelligence unit (Fl country. According to FATF recommendations, which is the best action for the FI to take?

  A. Request an official court subpoena with details of the investigation.

  B. Provide as much information as possible to the FIU immediately.

  C. Establish a committee from different areas of the Fl to determine if the request should be answered.

  D. Inform the public relations department to prepare for negative news.

  E. ling the financing of terrorism that could imply an imminenl threat in the

  Correct Answer: B

  The correct answer is B because the FATF recommendations state that financial institutions should provide feedback to the FIU as quickly as possible, especially in cases involving the financing of terrorism that could imply an imminent threat to the country. Option A is incorrect because requesting an official court subpoena would delay the response and might not be necessary for the FIU to access the information. Option C is incorrect because establishing a committee would also delay the response and might not be in compliance with the FIU's request. Option D is incorrect because informing the public relations department is irrelevant to the question and might compromise the confidentiality of the investigation. References: FATF Recommendations, Recommendation 29; Leading Complex Investigations Certificate, Module 4.

• Question 28:

  A financial institution might use which option as intelligence to file a SAR/STR?

  A. A customer makes several deposits in one month that appear to exceed their expected monthly income.

  B. A customer receives a large, one-time wire from a law firm.

  C. The Fl is unable to obtain evidence of required licensing or registration despite suspicion of money transmitting.

  D. The Fl discovers a large number of securities transactions that appear to be related to day trading.

  Correct Answer: C

  The correct answer is C because the FI is unable to obtain evidence of required licensing or registration despite suspicion of money transmitting, which is a red flag for money laundering and a violation of federal and state laws. Option A is incorrect because making several deposits in one month that appear to exceed their expected monthly income might not be indicative of suspicious activity, depending on the customer's profile and source of funds. Option B is incorrect because receiving a large, one-time wire from a law firm might not be indicative of suspicious activity, depending on the customer's relationship with the law firm and the purpose of the wire. Option D is incorrect because discovering a large number of securities transactions that appear to be related to day trading might not be indicative of suspicious activity, depending on the customer's investment strategy and risk tolerance. References: Money transmitter - Wikipedia; The Quick Guide To Money Transmitter Licenses - Surety Bond Insider; Financial Crime Typologies - Intermediate Certificate, Module 3.

• Question 29:

  Which payment method for purchasing luxury items is a red flag for potential money laundering?

  A. Personal loan

  B. Cash

  C. Wire transfer

  D. Credit card

  Correct Answer: B

  According to the Financial Action Task Force (FATF), the use of large amounts of cash is a common method for money launderers to move illicit funds [1]. Purchasing luxury items with cash can indicate an attempt to convert illegal funds into tangible assets that can be easily resold or moved across borders. As a result, businesses that deal with luxury items are required to implement enhanced due diligence measures, including monitoring transactions involving large amounts of cash [1]. Reference: [1] Financial Action Task Force. (2013). Money Laundering and Terrorist Financing Through the Real Estate Sector. https://www.fatf- gafi.org/media/fatf/documents/reports/ML-TF-through-real-estate.pdf

• Question 30:

  During a review, an analyst notices discrepancies between a customer's nature of business listed on the business registry and what was stated on the customers application. The analyst should:

  A. clarify discrepancies noted in the customer's declared profile given the downstream impact on the risk assessment.

  B. close the review as there is no adverse news in the public domain.

  C. review all documents for whether certified true copies are submitted.

  D. accept discrepancies in the information given the onboarding team did not flag any issue.

  Correct Answer: A

  The analyst should clarify discrepancies noted in the customer's declared profile given the downstream impact on the risk assessment. This is because discrepancies between the customer's nature of business and the information on the

  business registry may indicate that the customer is not operating a legitimate business or is trying to conceal its true activities. The analyst should verify the customer's identity, source of funds, and purpose of transactions to ensure that the

  customer's risk profile is accurate and consistent with the Fl's risk appetite.

  References: Leading Complex Investigations Certificate, Module 2, page 9.