ACAMS ACAMS Certifications CAMS Questions & Answers

• Question 161:

  A compliance officer is reviewing transactions related to a company suspected of being involved in wildlife trafficking. Which of activities below are common in wildlife trafficking schemes? (Select Two.)

  A. Large dollar wire transfers between wildlife farms and firms operating in inconsistent lines of business

  B. Exchanging fiat currency to cryptocurrency to accomplish payment to the wildlife farm

  C. Activity involving politically exposed persons with environmental, game, or forestry oversight

  D. Payment of transportation charges using a fraudulent financial instrument

  E. Customer requests payment of proceeds to an unrelated third party

  Correct Answer: AC

• Question 162:

  When a financial institution is requested to provide data and information to a law enforcement agency for matters related to financing of terrorism, assistance:

  A. can be refused on the grounds of tipping-off.

  B. cannot be refused on the grounds of tipping-off.

  C. can be refused on the grounds of bank secrecy.

  D. cannot be refused on the grounds of bank secrecy.

  Correct Answer: B

  When a law enforcement agency requests a financial institution to provide data and information related to financing of terrorism, the institution cannot refuse the request on the grounds of tipping-off. The institution should provide the requested information in accordance with the applicable laws and regulations, as well as the institution's internal policies and procedures. However, the institution may refuse the request on the grounds of bank secrecy, if it is not in compliance with the relevant laws and regulations.

• Question 163:

  The recommended way lot a financial institution to respond to a request from a law enforcement agency is to:

  A. train all staff to enable them to respond to subpoenas.

  B. hand over documents that are protected by attorney-client privilege

  C. freeze the identified account immediately

  D. have an audit trail system to produce requested documentation

  Correct Answer: D

  Financial institutions are required by law to maintain records and documentation of customer transactions and to provide this information to law enforcement agencies upon request. However, financial institutions should also have policies and procedures in place to ensure that they comply with legal and regulatory requirements and protect customer privacy. Providing protected documents that are privileged under attorney-client privilege or freezing an account immediately may not be the appropriate response and may expose the financial institution to legal or reputational risks. Reference: CAMS (6th ed.), Chapter 6, p. 261-262.

• Question 164:

  A foreign bank's compliance officer receives a request for information from a US bank, alerting the foreign bank to the possibility that it may have transferred funds on behalf of an Office of Foreign Assets Control (OFAC>-sanctioned person, who holds an account with the foreign bank. Which statements are true with respect to said funds and the information in relation to the transaction under scrutiny? (Select Two.)

  A. If the funds are seized, then the foreign bank would be within its rights to dispute such seizure.

  B. US authorities have no power (in terms of the USA PATRIOT Act) to sanction the foreign bank for transferring funds on behalf of an OFAC-sanctioned entity.

  C. The USA PATRIOT Act authorizes the Secretary of the Treasury or the Attorney General to subpoena records from the foreign bank that maintains a correspondent account with a US bank,

  D. If a US citizen were part of the foreign bank's Board deliberations where a decision was made to onboard the OFAC-sanctioned entity as a client, then they can be confronted with criminal charges.

  E. US authorities are only permitted to seize the funds transferred by the foreign bank under OFAC sanctions if there is an equivalent sanctions regime of the UN which has been contravened.

  Correct Answer: AC

  According to the USA PATRIOT Act, US authorities do have the power to subpoena records from foreign banks that maintain correspondent accounts with US banks. This is known as a "section 314 (a) request," which allows law enforcement to obtain information related to suspected terrorist financing or money laundering. However, US authorities are not limited to seizing only funds transferred under OFAC sanctions if there is an equivalent UN sanctions regime that has been contravened. The US government can impose its own sanctions that are independent of the UN, and can seize funds or take other actions to enforce those sanctions. Therefore, the correct answers to the question are A and C:

  A. If the funds are seized, then the foreign bank would be within its rights to dispute such seizure. C. The USA PATRIOT Act authorizes the Secretary of the Treasury or the Attorney General to subpoena records from the foreign bank that maintains a correspondent account with a US bank.

• Question 165:

  The Chief Compliance Officer (CCO) of a financial institution has been asked by a manufacturing customer reliant upon imported raw materials if there will be repercussions to his business following the weak assessment of the recent publicly issued Financial Action Task Force (FATF) Mutual Evaluation Report (MER). How should the CCO respond?

  A. Delayed processing of cross-border transfer of funds between countries may occur due to increased scrutiny to determine the legitimacy of each transfer.

  B. Citing inaccurate content of the MER. the president of the country has called upon the FATF to publicly withdraw the MER and commission an independent review of findings.

  C. Mandate termination of all cross-border trading until evidence can be provided to show an improved position of compliance for the weaknesses stated in the MER.

  D. Negative consequences will not occur because the manufacturing customer has been trading with reputable countries and suppliers for many years without incident.

  Correct Answer: A

  According to the Certified Anti-Money Laundering Specialist (the 6th edition) Study guide, the CCO should advise the manufacturing customer that increased scrutiny of cross-border transfers may lead to delays and caution them to ensure that all necessary documentation is provided in order to facilitate a timely transfer. Additionally, the CCO should recommend that the customer contact the FATF to discuss the possibility of an independent review of the findings, as well as other options to mitigate the potential negative consequences.

• Question 166:

  A bank teller receives a written request from a police officer to review a previous customer's account on a pre-populated form with the officer's official letterhead. The officer suspects the previous customer is engaging in smurfing. Which action should the bank teller perform?

  A. Provide the police officer the customer's account information after management approval.

  B. Escalate the police officer's request for the customer's account information to the compliance officer.

  C. Reject the police officer's request for the customer's account information and escalate to the compliance officer.

  D. Provide the police officer the customer's account information.

  Correct Answer: B

  The compliance officer should evaluate the request, determine whether it is valid, and provide the necessary information, subject to management approval. It is important to follow the bank's policies and procedures for responding to law

  enforcement requests, including verifying the authenticity of the request and the identity of the officer making the request. Additionally, it is important to protect customer privacy and ensure that sensitive information is not released to

  unauthorized individuals. (Reference:

  Certified Anti- Money Laundering Specialist (the 6th edition), Chapter 6)

• Question 167:

  Who meets the standard to perform the AML audit? (Select Two.)

  A. An internal auditor with a family member employed in the AML department

  B. An internal auditor with the requisite knowledge and expertise of AML

  C. A consultant previously employed in the AML department within the past 2 years

  D. Qualified bank staff if not involved in the AML function being tested

  E. A consultant with limited knowledge and experience in AML but many years of internal audit experience

  Correct Answer: BD

  An internal auditor with the requisite knowledge and expertise of AML: An internal auditor with sufficient knowledge and expertise in AML regulations and compliance requirements can perform the AML audit. Qualified bank staff if not involved in the AML function being tested: Qualified bank staff who are not involved in the AML function being audited can perform the AML audit.

• Question 168:

  What should an employee do after witnessing suspicious activity from a coworker?

  A. Request that the coworker provide justification for their actions.

  B. Escalate to the company's conflict line or compliance department.

  C. Request help from colleagues in determining that the best course of action.

  D. Discuss the suspicious activity with your supervisor.

  Correct Answer: B

  An employee who witnesses suspicious activity from a coworker should not confront the coworker or discuss the activity with their supervisor. Instead, they should report the activity to their employer's conflict line or compliance department, who can investigate the matter and take the appropriate action. It is important to remember that employees are legally obligated to report any suspicious activity they witness.

• Question 169:

  Which reputations risk consequence could a financial entity face for violating AML laws?

  A. Loss of high-profile customers

  B. Seizure of assets

  C. Increased audit costs to monitor behavior

  D. Monetary penalties

  Correct Answer: D

  According to the Certified Anti-Money Laundering Specialist (CAMS) Manual [1], 6th edition, financial entities that violate Anti-Money Laundering (AML) laws can face several reputational risks such as loss of high-profile customers, seizure of assets, increased audit costs to monitor behavior, and monetary penalties. For example, the US Treasury's Financial Crimes Enforcement Network (FinCEN) imposes civil money penalties on "persons who willfully violate, attempt to violate, conspire to violate, or cause any violation of any provision of the Bank Secrecy Act or its implementing regulations." (CAMS Manual, 6th edition, page 26).

• Question 170:

  Which is a valid extraterritorial effect of the USA PATRIOT Act?

  A. Foreign branches of US banks can maintain correspondent accounts with banks that do not have a physical presence in any country.

  B. Financial institutions are allowed to specifically direct client transactions that move their funds into, out of, or through an internal bank concentration account ^

  C. Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country.

  D. Any deposits into foreign banks are not considered to have been deposited into any interbank account the foreign bank may have in the US.

  Correct Answer: C

  Broker-dealers cannot have correspondent accounts with a foreign bank that does not have a physical presence in any country. The USA PATRIOT Act has an extraterritorial effect in that it prohibits broker-dealers from having correspondent accounts with foreign banks that do not have a physical presence in any country. This rule is designed to help prevent money laundering and terrorist financing by making it more difficult for funds to be moved to or through jurisdictions with less stringent anti-money laundering laws.