ACAMS ACAMS Certifications CAMS Questions & Answers

• Question 81:

  When using virtual assets such as Bitcoin to finance terrorism, which tactic may be used to ensure that the virtual assets are not easily seized by law enforcement?

  A. Using self-hosted wallets to create many different donation addresses that are updated continuously

  B. Posting donation addresses that are linked to accounts at centralized virtual asset service providers

  C. Using the same donation address across multiple donation campaigns and media types

  D. Forming relationships with virtual asset service providers that have strong KYC processes in place to avoid suspicion

  Correct Answer: A

  Using self-hosted wallets, or wallets that are stored on the user's computer, is one of the tactics that may be used to finance terrorism with virtual assets such as Bitcoin. By creating many different donation addresses that are updated continuously, law enforcement will have a harder time tracing transactions. It is also important to note that using the same donation address across multiple donation campaigns and media types, as well as forming relationships with virtual asset service providers that have strong KYC processes in place, can draw attention from law enforcement and should be avoided.

• Question 82:

  Sanctions screening requirements include that a financial institution should:

  A. report an individual whose name appears on a sanctions list to the police.

  B. immediately freeze the bank account of an individual that appears on a sanctions list.

  C. compare customer and transaction records against periodically updated sanctions lists provided by governmental bodies.

  D. immediately close the bank account of an entity who appears on a sanctions list.

  Correct Answer: C

  Compare customer and transaction records against periodically updated sanctions lists provided by governmental bodies. This is stated in the Certified Anti-Money Laundering Specialist (the 6th edition) manual on page 595, which states: "Sanctions screening requirements include that a financial institution should compare customer and transaction records against periodically updated sanctions lists provided by governmental bodies."

• Question 83:

  A bank receives a request for a subpoena (or a client who has been the subject of monitoring for several months. The bank wishes to close the account in order to mitigate any additional risk. However, the government requires that the account remain open. What document must be provided to the bank to keep the account open?

  A. An email agreement between the government and the financial institution to keep the account open

  B. A request in writing under proper letterhead and authority from the government

  C. An order to keep the account open but with the funds frozen

  D. An authorization from the board of directors

  Correct Answer: B

  If a financial institution wishes to close an account due to concerns about potential money laundering or other financial crimes, it is generally required to file a suspicious activity report (SAR) with the appropriate government agency. However, there may be instances where the government requires the account to remain open for ongoing investigation purposes. In such cases, the government must provide a written request under proper letterhead and authority to keep the account open. This document will serve as legal justification for the financial institution to maintain the account, even though it may pose a higher risk for money laundering or other financial crimes.

• Question 84:

  The owner of a real estate investment company deposits multiple cashier's checks that were bought using cash over a three-month period, from the sale of two apartments. This account also receives several electronic transfers from other financial institutions for 10.000 USD each.

  What activity is considered suspicious of money laundering?

  A. Using cash to buy multiple cashier's checks over a period of time

  B. Using cashier's checks in the transactions with the real estate investment company's account

  C. Performing operations with real estate investment companies

  D. Receiving electronic transfers for 10.000 USD amounts from other financial institutions

  Correct Answer: A

  Using cash to buy multiple cashier's checks over a period of time is considered suspicious activity of money laundering. This method is commonly known as structuring, where individuals or entities use cash to buy multiple monetary instruments such as cashier's checks in small amounts, to avoid reporting requirements. This behavior could be an attempt to evade transaction monitoring and reporting requirements by a financial institution. Additionally, the fact that the account also receives multiple electronic transfers for the same amount could be a red flag for money laundering as it is a common technique used to layer or disguise the origin of illicit funds. Reference: Certified Anti-Money Laundering Specialist (the 6th edition) Study Guide, page 100-101.

• Question 85:

  Which is an emerging risk associated with cyber-enabled fraud?

  A. Multiple people colluding to place funds in the financial market

  B. Receipt of joint account wire transfers

  C. Mismatch between account names and government-issued documentation

  D. Frequent transactions in round or whole dollars

  Correct Answer: C

  This is an emerging risk associated with cyber-enabled fraud because the use of false identities and documents can allow criminals to disguise their activities and evade detection. In such cases, the name and address provided on the account may not match the name and address on the government-issued documentation. This discrepancy can be difficult to detect, making it a potential risk for financial institutions.

• Question 86:

  Which are essential elements of a KYC program identified by the Basel Committee on Banking Supervision? (Choose two.)

  A. Internal control

  B. Customer acceptance policy

  C. Code of conduct

  D. Risk appetite

  E. Risk management

  Correct Answer: BE

• Question 87:

  Three individuals enter a casino and use cash to purchase chips worth 20,000 USD. The trio uses 200 USD in chips to play games and then combine their funds to request a casino cheque. What is the potential red flag that alludes to money laundering?

  A. The trio purchased the chips with cash and proceeded to gamble.

  B. The trio engage in minimal gambling and combine the funds to request a casino cheque for the chips presented.

  C. The trio uses chips worth 200 USD to gamble before requesting the refund.

  D. The trio purchased chips worth 20,000 USD and requested a casino cheque for the remaining chips.

  Correct Answer: B

  The potential red flag that alludes to money laundering is option B, where the trio engage in minimal gambling and combine the funds to request a casino cheque for the chips presented. This behavior is indicative of structuring, which involves breaking down large transactions into smaller ones to avoid detection by the casino and regulatory authorities. The fact that the trio only used a small amount of chips to play games, and then combined their funds to request a casino cheque, raises suspicions that they may be attempting to disguise the origin of their funds.

• Question 88:

  When may Office of Foreign Assets Control (OFAC) sanctioned-related transactions be allowed that would otherwise be prohibited?

  A. When the bank's board of directors approves the OFAC risk appetite for sanction-related transactions

  B. Through an OFAC licensing process to determine that the transaction does not undermine the US policy objectives

  C. Only when the federal banking regulator provides OFAC approval before the transactions are processed

  D. After going through a robust internal OFAC audit process that reviews sanction-related risks

  Correct Answer: B

  The Office of Foreign Assets Control (OFAC) administers and enforces economic sanctions programs [1][2], which are designed to protect US national security, foreign policy, and economic interests. Transactions that would otherwise be prohibited can be allowed through an OFAC licensing process, in which the OFAC evaluates the request to determine that the transaction does not undermine US policy objectives.

• Question 89:

  Money laundering can cause which consequences for a financial institution? (Select Two.)

  A. Increases in corporate taxes

  B. Increases in investigation costs and fines

  C. Reduction in number of employees

  D. Reduction or loss of profitable business

  E. Increases in correspondent banking facilities

  Correct Answer: BD

  Money laundering can have serious consequences for financial institutions. They may face increased investigation costs and fines from regulators and law enforcement agencies for failing to detect or prevent money laundering activities.

  Additionally, money laundering can result in a loss of profitable business as customers and counterparties may no longer want to do business with the institution due to its reputation for being associated with illicit activity.

  Reference: Certified Anti-Money Laundering Specialist (CAMS) Study Guide, 6th Edition, page 76.

• Question 90:

  What is a primary responsibility of a financial intelligence unit?

  A. Provide expertise to Egmont working groups including the development of new techniques to launder money.

  B. Publish suspicious activity reports so that entities subject to money laundering obligations are aware of the identities of criminals.

  C. Act as an intermediary between the entities subject to money laundering obligations and law enforcement agencies.

  D. Legislate regulations that enhance the effectiveness of AML and sanctions compliance.

  Correct Answer: C

  The primary responsibility of a financial intelligence unit is to act as an intermediary between the entities subject to money laundering obligations and law enforcement agencies. Financial intelligence units are responsible for receiving and analyzing suspicious activity reports (SARs) from entities subject to money laundering obligations, and then forwarding relevant information to the appropriate law enforcement agencies. Additionally, the financial intelligence units are responsible for providing expertise to Egmont working groups to help develop new techniques to detect and prevent money laundering.