ACAMS CAMS-FCI Online Practice Questions and Exam Preparation

ACAMS CAMS-FCI Online Questions & Answers

• Question 61:

  A country that does not have strong predicate offenses and is lax in prosecuting AML cases could suffer which social/economic consequence?

  A. US sanctions
  B. Increased organized crime and corruption
  C. Reputation risk for the port
  D. Loss of tax revenue
  B. Increased organized crime and corruption

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  Explanation/Reference:

  A country that does not have strong predicate offenses and is lax in prosecuting AML cases could suffer increased organized crime and corruption as a social/economic consequence. "Weaknesses in the AML/CFT regime can lead to a range

  of economic and social consequences, including...increased crime and corruption." (CAMS Manual, 6th Edition, page 32)

• Question 62:

  Which action is part of the enhanced due diligence process?

  A. Collecting beneficial ownership details regarding the client's account
  B. Using standard monitoring procedures to monitor transactions and account activity
  C. Verifying the source of wealth for entities and natural person clients
  D. Applying higher ownership percentage requirement for beneficial ownership collection
  A. Collecting beneficial ownership details regarding the client's account

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  Explanation/Reference:

  One of the actions that is part of the enhanced due diligence process is collecting beneficial ownership details regarding the client's account. This is important to identify the natural persons who ultimately own or control the client, and to

  assess the potential risks associated with them. According to the Financial Action Task Force (FATF), beneficial ownership information should include1:

  The name, nationality, and country of residence of each beneficial owner. The date of birth or incorporation of each beneficial owner. The nature and extent of the beneficial interest held by each beneficial owner. The means by which the

  beneficial ownership or control is exercised.

  References:

  FATF Guidance on Transparency and Beneficial Ownership

• Question 63:

  A client that runs a non-profit organization that aids refugees in leaving their home countries received a remittance from a money services business that was ten times the average. The client was recently detained for providing falsified passports to illegal immigrants. Which predicate offenses could be considered in the SAR/STR? (Select Two.)

  A. Human smuggling/trafficking
  B. Terrorist financing
  C. Narcotics trafficking
  D. Antiques smuggling
  E. Tax evasion
  A. Human smuggling/trafficking
  B. Terrorist financing

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  Explanation/Reference:

  The correct answer is A and B because human smuggling/trafficking and terrorist financing are both predicate offenses for money laundering that could be related to the client's activities. Option C is incorrect because there is no indication of

  narcotics trafficking in the scenario. Option D is incorrect because there is no indication of antiques smuggling in the scenario. Option E is incorrect because there is no indication of tax evasion in the scenario.

  References: Advanced CAMS-FCI Certification Handbook, page 10; Financial Crime Typologies - Intermediate Certificate, Module 2.

• Question 64:

  During transaction monitoring. Bank A learns that one of its customers. Med Supplies 123, is attempting to make a payment via wire totaling 382.500 USD to PPE Business LLC located in Mexico to purchase a large order of personal

  protective equipment. specifically surgical masks and face shields. Upon further verification. Bank A decides to escalate and refers the case to investigators.

  Bank A notes that days prior to the above transaction, the same customer went to a Bank A location to wire 1,215,280 USD to Breath Well LTD located in Singapore. Breath Well was acting as an intermediary to purchase both 3-ply surgical

  masks and face shields from China. Bank A decided not to complete the transaction due to concerns with the involved supplier in China. Moreover, the customer is attempting to send a third wire in the amount of 350,000 USD for the

  purchase of these items, this time using a different vendor in China. The investigator must determine the next steps in the investigation and what actions, if any.

  should be taken against relevant parties.

  The investigator is gathering more information to determine if a SAR/STR filing is needed. Which steps are the correct ways of collecting the additional information? (Select Two.)

  A. Reach out to the relationship manager asking if more up-to-date customer due diligence information can be collected on the customer.
  B. Use available documentation received from law enforcement (e.g.. grand jury subpoena) as red flags in SAR/STR filing.
  C. Reach out to the customer and ask for supporting documentation for the conducted wires to avoid SAR/STR filing.
  D. Conduct open-source research to determine if the customer and involved counterparties are in the same business field.
  E. Issue a USA PATRIOT ACT Section 314(b) request to participating financial institutions advising that information is needed to decide if the activity is suspicious.
  A. Reach out to the relationship manager asking if more up-to-date customer due diligence information can be collected on the customer.
  D. Conduct open-source research to determine if the customer and involved counterparties are in the same business field.

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  Explanation/Reference:

  The correct answer is A and C because these indicators suggest that the customer is using fraudulent documents and misrepresenting the goods to conceal the illicit nature of the transactions. Fentanyl traffickers often use front companies

  and falsified invoices to disguise their shipments as legitimate products, such as medical supplies or chemicals. Reviewing the invoices and transportation documents, as well as the FDA product certifications, can help to identify

  discrepancies or anomalies that indicate fraud or deception.

  References: Fentanyl and Fentanyl Analogues: Federal Trends and Trafficking Patterns, page 18; Fentanyl Trafficking Offenses, page 2.

• Question 65:

  A client at a financial institution deposits large amounts of money into an account, and almost immediately, the funds are then distributed to numerous individuals' accounts. The transaction activity described in the scenario is a pattern of:

  A. geographic usage.
  B. deposit trading.
  C. safe deposit custody.
  D. account usage.
  B. deposit trading.

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  Explanation/Reference:

  Deposit trading is a pattern of suspicious activity where a client deposits large amounts of money into an account, and then transfers the funds to other accounts, often in different jurisdictions or countries. This could be an attempt to disguise the source or destination of the funds, or to avoid reporting requirements. Deposit trading is also known as layering, which is the second stage of money laundering. References: ACAMS Advanced Financial Crimes Investigations Certification Study Guide, page 43; ACAMS Glossary, page 34.

• Question 66:

  A financial institution (Fl) banks a money transmitter business (MTB) located in Miami. The MTB regularly initiates wire transfers with the ultimate beneficiary in Cuba and legally sells travel packages to Cuba. The wire transfers for money remittances comply with the country's economic sanctions policies. A Fl investigator on the sanctions team reviews each wire transfer to ensure compliance with sanctions and to monitor transfer details.

  An airline located in Cuba, unrelated to the business, legally sells airline tickets in Cuba to Cuban citizens wanting to travel outside of Cuba. The airline tickets are purchased using Cuban currency (CUC).

  The MTB wants 100,000 USD worth of CUC. Purchasing CUC from a Cuban bank includes a 4% fee. The MTB contacts the airline to ask if the airline will trade its CUC for USD at a lower exchange fee than the Cuban bank. The airline agrees to a 1% fee. The MTB initiates a wire transfer to the airline which appears as normal activity in the monitoring system because of the business' travel package sales.

  The investigator recommends that a SAR/STR be filed. What documentation should be referenced in the SAR/STR filing? (Select Three.)

  A. All documents related to the agreement between the airline and the MTB
  B. Cumulative dollar amount of the wire transfer activity
  C. Airline's ticket sales and passenger list
  D. Cumulative dollar amount for transactions listing for all the MTB account's wire activity regarding travel packages
  E. Licensing information regarding the travel agency providing tourist sales to Cuba
  F. Account documentation on all related accounts maintained by the MTB
  B. Cumulative dollar amount of the wire transfer activity

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  Explanation/Reference:

  The most likely reason for conducting a reverse transaction is to conceal or launder illicit funds. A reverse transaction is a transaction that reverses a previous transaction, such as a refund, a chargeback, or a cancellation. Reverse transactions can be used by money launderers to obscure the source, ownership, or destination of funds, or to create false records or invoices. For example, a money launderer may initiate a wire transfer from a high-risk jurisdiction to a low-risk jurisdiction, and then reverse the transaction after receiving confirmation of the funds. This way, the money launderer can create a paper trail that shows legitimate funds coming from a low-risk jurisdiction, while hiding the true origin of the funds. References: Advanced CAMS-FCI Study Guide, page 40-41.

• Question 67:

  Which is a key characteristic of the Financial Action Task Force (FATF) Regional Style Bodies for combatting money laundering/terrorist financing?

  A. Instructing each member country to place FATF recommendations into law
  B. Implementing regional mutual evaluation procedures
  C. Emphasizing regional co-operation between member countries
  D. Enabling FATF standards to be specific to each region
  B. Implementing regional mutual evaluation procedures

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  Explanation/Reference:

  According to the CAMS study guide, the Financial Action Task Force (FATF) Regional Style Bodies are organizations created by the FATF to promote the implementation of anti-money laundering and countering the financing of terrorism (AML/CFT) measures in specific regions. One of the key characteristics of these bodies is the implementation of regional mutual evaluation procedures. Regional mutual evaluations involve member countries evaluating each other's AML/CFT regimes to identify strengths and weaknesses and to develop best practices for improvement. This process allows for greater cooperation between countries and can help to identify and address regional AML/CFT risks more effectively. It also promotes consistency in AML/CFT standards and practices within the region.

• Question 68:

  An AML investigator at a bank identifies an unusually high number of deposits from a few customers resulting from the encashment of multiple gambling tickets from a legitimate gambling company. It is noted that the transactions are inconsistent with the customers' profiles and that reverse (corrective) transactions did not occur. Which suspicious activity is most likely?

  A. The winning tickets are traded to criminals who. in turn, use the customers' accounts.
  B. The gambling company created fictitious transactions in an attempt to misrepresent the size of its business activity.
  C. The customers are attempting to evade income tax.
  D. The customers deposited fake winning tickets.
  A. The winning tickets are traded to criminals who. in turn, use the customers' accounts.

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  Explanation/Reference:

  The correct answer is A because this scenario describes a possible case of ticket laundering, which is a form of money laundering where criminals use gambling tickets to disguise the source of their illicit funds. The customers who deposit the tickets are either complicit or unaware of the scheme, and they receive a commission or a fee for their service. The other options are not likely because they do not explain why the customers would deposit multiple tickets from the same gambling company and withdraw cash the next day. References: : Ticket Laundering: A Money Laundering Method

• Question 69:

  During transaction monitoring. Bank A learns that one of their customers. Med Supplies 123. is attempting to make a payment via wire totaling 382,500 USD to PPE Business LLC located in Mexico to purchase a large order of personal

  protective equipment. specifically surgical masks and face shields. Upon further verification. Bank A decides to escalate and refers the case to investigators.

  Bank A notes that, days prior to the above transaction, the same customer went to a Bank A location to wire 1,215,280 USD to Breath Well LTD located in Singapore. Breath Well was acting as an intermediary to purchase both 3-ply surgical

  masks and face shields from China. Bank A decided not to complete the transaction due to concerns with the involved supplier in China. Moreover, the customer is attempting to send a third wire in the amount of 350,000 USD for the

  purchase of these items, this time using a different vendor in China. The investigator must determine next steps in the investigation and what actions, if any.

  should be taken against relevant parties.

  During the investigation, Bank A receives a USA PATRIOT Act Section 314(a) request related to Med Supplies 123. Which steps should the investigator take when fulfilling the request? (Select Three.)

  A. Exit the relationship with the business since it appears that customer is under investigation.
  B. Do not respond to Financial Crimes Enforcement Network (FinCEN) if the requested information is not present in the financial institution's system of records.
  C. Review the account(s) activity and proactively file a SAR/STR using the 314(a) request as the basis for the filing.
  D. Report to Financial Crimes Enforcement Network (FinCEN) that a match was found without revealing any other details.
  E. Report back to the Financial Crimes Enforcement Network (FinCEN) within 15 days of receipt of the request via a secure internet website.
  F. Search its records expeditiously to determine whether it maintains(ed) any accounts for the subject(s) listed in the request.
  D. Report to Financial Crimes Enforcement Network (FinCEN) that a match was found without revealing any other details.
  E. Report back to the Financial Crimes Enforcement Network (FinCEN) within 15 days of receipt of the request via a secure internet website.
  F. Search its records expeditiously to determine whether it maintains(ed) any accounts for the subject(s) listed in the request.

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  Explanation/Reference:

  According to the FinCEN's 314(a) Fact Sheet1, the steps that the investigator should take when fulfilling the request are:

  Search its records expeditiously to determine whether it maintains(ed) any accounts for the subject(s) listed in the request. This is option F. Report back to the Financial Crimes Enforcement Network (FinCEN) within 15 days of receipt of the

  request via a secure internet website. This is option E. Report to Financial Crimes Enforcement Network (FinCEN) that a match was found without revealing any other details. This is option D.

  The other options are incorrect because:

  Exiting the relationship with the business since it appears that customer is under investigation is not required by the 314(a) program and may interfere with law enforcement's investigation. This is option A.

  Not responding to Financial Crimes Enforcement Network (FinCEN) if the requested information is not present in the financial institution's system of records is contrary to the 314(a) program, which requires financial institutions to respond

  whether or not they have a match. This is option B. Reviewing the account(s) activity and proactively filing a SAR/STR using the 314(a) request as the basis for the filing is not appropriate, as the 314(a) request itself is not a sufficient reason

  to file a SAR/STR. The financial institution should only file a SAR/STR if it has its own independent suspicion of money laundering or terrorist financing. This is option C.

  References: 1: FinCEN's 314(a) Fact Sheet

• Question 70:

  In a SAR/STR narrative concerning Individual A. which statement indicates a product of analysis rather than a fact or judgement?

  A. Individual A was the originator of nine wires totaling 225.000 USD between January and March 2020.
  B. Individual A made structured cash deposits possibly to circumvent regulatory reporting requirements
  C. Individual A made structured cash deposits on almost consecutive days.
  D. Individual A is a college student and employed part-time at a car wash.
  B. Individual A made structured cash deposits possibly to circumvent regulatory reporting requirements

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  Explanation/Reference:

  A product of analysis is a conclusion or inference that is derived from facts or judgments, using analytical techniques or tools. Option B is a product of analysis because it implies that the investigator has used a tool or technique, such as a

  threshold analysis, to identify a pattern of structured cash deposits that may indicate an attempt to evade reporting requirements. The other options are facts or judgments that can be verified by evidence or observation.

  References: Advanced CAMS-FCI Certification Handbook, page 23.