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NEW QUESTION # 285
What is the appropriate compliance control for identifying politically exposed persons (PEPs) according to the Basel Committee's paper on Customer Due Diligence for Banks?
- A. Requiring that the customer discloses that they are a PEP or an associate of a PEP
- B. Determining that a local figure is a PEP
- C. Reviewing when a relationship is established
- D. Reviewing relationships at account opening and on a periodic basis
Answer: D
NEW QUESTION # 286
To ensure compliance with economic sanctions established by governmental authorities in the jurisdictions where it operates, a financial institution requires that all new and existing customers be screened at onboarding and quarterly thereafter.
Is this step sufficient to ensure compliance?
- A. No, screening should occur promptly after list updates
- B. Yes, this is recommended by the international guidance
- C. No, it is necessary to screen and perform enhanced due diligence on new relationships
- D. Yes, screening all existing customer relationships ensures the institutions is not dealing with a sanctioned individual or entity
Answer: B
NEW QUESTION # 287
In which two ways does a government Financial Intelligence Unit interact with public and private sectors?
(Choose two.)
- A. It disseminates information and the results of its analysis to competent authorities
- B. It governs the methods of investigation used by competent authorities
- C. It receives and analyzes disclosures filed by financial and non-bank institutions
- D. It mediates disputes between financial institutions and investigative authorities
Answer: A,C
Explanation:
Explanation/Reference: http://pubdocs.worldbank.org/en/834721427730119379/AML-Module-2.pdf
NEW QUESTION # 288
In relationship to life insurance business, the third European Directive states that Member States may allow the identity verification of the beneficiary under the policy after the business relationship has been established, but before which events?
- A. At or before 30 days of the relationship being established under the policy
- B. At or before the policy is issued to the beneficiary by the insurance company
- C. At or before a premium payment has been accepted for the policy purchased
- D. At or before the time of payout or before the beneficiary intends to exercise rights vested underthe policy
Answer: D
NEW QUESTION # 289
A new AML Officer for a US-based money service business (MSB) is drafting procedures around types of activity that require further review. Which should be included? (Choose two.)
- A. A customer buying several money orders totaling over $10,000 USD using debit card on the same day using government-issued identification.
- B. A customer attempting to buy money orders under $3,000 USD in cash multiple times a day.
- C. A customer visiting multiple branches of the MSB on the same day in order to transfer funds internationally.
- D. A customer buying multiple money orders for $250 totaling $2,000 USD.
- E. A customer sending funds to a family member living in a high-risk jurisdiction that is subject to civil unrest.
Answer: A,C
NEW QUESTION # 290
AML cooperation between countries consists of which three official gateways?
- A. Mutual Legal Assistance Treaties (MLAT)
- B. A communication between Financial Intelligence Units (FIU)
- C. The Basel Committee
- D. The supervisory channel
Answer: A,D
NEW QUESTION # 291
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. cannot be refused on the grounds of tipping-off.
- B. can be refused on the grounds of tipping-off.
- C. cannot be refused on the grounds of bank secrecy.
- D. can be refused on the grounds of bank secrecy.
Answer: A
Explanation:
Explanation
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.
NEW QUESTION # 292
What do the Financial Action Task Force (FATF) mutual evaluations of each member assess?
- A. The member's ability to send a representative to the plenary sessions
- B. If the member has made any suggestions for updates to the FATF Recommendations
- C. If the member has a large enough economy to maintain its membership
- D. The levels of implementation of the FATF Recommendations
Answer: D
Explanation:
Reference:
https://www.fatf-gafi.org/publications/mutualevaluations/documents/more-about-mutual-evaluations.html
NEW QUESTION # 293
An individual opened an account with a minimal cash deposit at a financial institution. He presented a foreign passport and stated he would be working locally for a few months. He also requested information about making electronic fund transfers. The institution was subsequently unable to verify the employment or residence information provided by the individual. Soon after this, a large transfer was sent to the customer's account. Which of the following is the course of action recommended by the Basel Committee on Banking Supervision's Customer Due Diligence for Banks?
- A. Post the deposit to the account and notify the customer that the deposit has been made.
- B. End the relationship by sending a check (cheque) to the customer for the full amount in the account.
- C. Implement enhanced due diligence procedures to monitor the account for suspicious activity.
- D. Close the account and return the funds to the source from which they were received.
Answer: D
NEW QUESTION # 294
What correspondent banking risk factor increases the risk for a Correspondent Bank?
- A. Limited product offering to customers in high-risk jurisdictions
- B. Major service provider to money service businesses
- C. Offers international funds transfer to customers
- D. Multi-national financial institution with global operations
Answer: B
NEW QUESTION # 295
Which method do terrorist financiers use to move funds without leaving an audit trail?
- A. Cash couriers
- B. Virtual currency
- C. Extortion
- D. Casa de cambio
Answer: A
Explanation:
Reference: https://www.fatf-gafi.org/media/fatf/documents/reports/FATF%20Terrorist%20Financing%
20Typologies%20Report.pdf (24)
NEW QUESTION # 296
When an institution files an STR with regard to a particular account, what steps should the institution take visa account?
- A. The institution should close the account due to the obvious risk it represents
- B. The institution should not close the account due to the risk of tipping off the customer andupsetting the criminal investigation
- C. The institution should consult its counsel and AML compliance officer and determine whetherclosing the account is in accord with the institution's procedures
- D. The institution should keep the account open due to the need to continue to monitor theaccount
Answer: C
NEW QUESTION # 297
The most effective tool used to detect structured transactions is
- A. An employee training program to detect suspicious transactions.
- B. Verification of the source of funds.
- C. A comprehensive account-opening procedure.
- D. A software program that can link apparently unrelated transactions.
Answer: B
NEW QUESTION # 298
Financial institutions (FIs) perform AML risk assessments to ensure:
- A. a record for regulators indicating an AML risk assessment was completed at least once.
- B. satisfaction of the board of directors' approved risk appetite.
- C. internal audit assurance that all AML-related policy and procedures are board approved.
- D. proper controls surrounding higher-risk products, services, customers, and geographic locations.
Answer: D
NEW QUESTION # 299
Which principles should be included in a FATF-Style Regional Body (FSRB) update? (Choose two.)
- A. Address AML/CFT technical assistance of individual members
- B. Protect the reputation and standing of FATF
- C. Issue country-specific Mutual Evaluation reports
- D. Establish AML/CFT standards and typologies
- E. Identify jurisdictions with weak AML/CFT regimes
Answer: C,D
Explanation:
Reference:
https://www.fatf-gafi.org/media/fatf/documents/High-Level%20Principles%20and%20Objectives%20for%20FA
NEW QUESTION # 300
You deploy an application that performs sentiment analysis on the data stored in Azure Cosmos DB.
Recently, you loaded a large amount of data to the database. The data was for a customer named Contoso, Ltd.
You discover that queries for the Contoso data are slow to complete, and the queries slow the entire application.
You need to reduce the amount of time it takes for the queries to complete. The solution must minimize costs.
What is the best way to achieve the goal? More than one answer choice may achieve the goal. Select the BEST answer.
- A. Migrate the data to the Cosmos DB database.
- B. Change the partitioning strategy.
- C. Change the transaction isolation level.
- D. Change the request units.
Answer: B
Explanation:
Explanation/Reference:
References:
https://docs.microsoft.com/en-us/azure/architecture/best-practices/data-partitioning
NEW QUESTION # 301
Which two actions should Financial Intelligence Units (FIUs) take when submitting a request to another FIU? (Choose two.)
- A. Send the same request to all FIUs
- B. Provide feedback on how the information was used
- C. Disclose the reason and purpose for the request
- D. Make best efforts to provide complete and factual information
Answer: C,D
NEW QUESTION # 302
What does the Financial Action Task Force (FATF) urge its members and all other jurisdictions to do when a jurisdiction is identified as having lax anti-money laundering / counter financing of terrorism controls?
- A. Apply economic sanctions until otherwise notified by FATF
- B. Consider customers from that jurisdiction as high risk
- C. Cease doing business with that jurisdiction immediately
- D. Apply counter-measures to that jurisdiction
Answer: D
NEW QUESTION # 303
What are two sources for maintaining up-to-date sanctions information? (Choose two.)
- A. Financial Action Task Force's list of High Risk and Non-Cooperative Jurisdictions
- B. U.S. Department of the Treasury - Section 311 - Special Measures
- C. U.S. Federal Bureau of Investigation's National Security Letters
- D. U.S. Department of the Treasury Office of Foreign Assets Control
Answer: B,D
NEW QUESTION # 304
Which two statements in the Wolfsberg Group's "Suppression of the Financing of Terrorism" define the role financial institutions should play in the fight against terrorism? (Choose two.)
- A. Financial institutions need to assist competent authorities in fighting terrorist financing through prevention, detection and information sharing.
- B. Financial institutions should have financial intelligence units dedicated to the investigation of activity that would lead to the detection of terrorist financing as a means to decrease global terrorism.
- C. Financial institutions need to continuously analyze the types of activity related to terrorist financing and develop models that in the long term will drive down terrorism.
- D. Financial institutions should apply extra due diligence whenever they see suspicious or irregular activities, especially when customers are engaged in sectors or activities that have been identified by competent authorities as being used for the financing of terrorism.
Answer: A,D
NEW QUESTION # 305
Which type of sanctions are most likely to be used in order to avoid escalating violent conflicts and/or proliferation of weapons?
- A. Financial prohibitions
- B. Arms and related materials embargo
- C. Export and import restrictions
- D. Asset freeze
Answer: D
Explanation:
Reference: https://collections.unu.edu/eserv/UNU:6431/UNSanctionsandPreventionConflict-Aug-2017.pdf (3)
NEW QUESTION # 306
What are two aspects of the Wolfsberg Anti-Money Laundering (AML) Principles for Correspondent Banking?
(Choose two.)
- A. At least one person, aside from the person sponsoring the relationship, should approve the correspondent relationship.
- B. Correspondent banking is an inherently high risk business and all correspondent bank relationships should be reviewed on an annual basis.
- C. An Institution may assign a low risk rating to a correspondent bank located in a jurisdiction deemed to have an adequate AML environment (e.g., Financial Action Task Force member country) without needing to consider other factors.
- D. Factors such as politically exposed person involvement and downstream (nested) correspondents increase the risk inherent in a correspondent relationship.
Answer: A,B
Explanation:
Explanation/Reference: https://www.wolfsberg-principles.com/sites/default/files/wb/pdfs/wolfsberg-standards/8.%
20Wolfsberg-Correspondent-Banking-Principles-2014.pdf
NEW QUESTION # 307
A customer comes into a financial institution and deposits a large amount of cash. He has never done that before. When asked about the deposit, he indicates he recently sold a used car and received cash.
He does not trust forms of payment and is wary of counterfeit money orders. What should the bank do?
- A. While the explanation appears plausible, the institution should, for a period of time, monitor the account for cash transactions and suspicious activity
- B. The institution should close the account before another issues arise
- C. The bank has received a plausible explanation, so it should do nothing
- D. While the explanation may be plausible, the institute should nonetheless file a Suspicious Transaction Report to protect itself
Answer: A
NEW QUESTION # 308
What is the goal of the Egmont Group in providing a forum for Financial Intelligence Units (FIUs) around the world?
- A. To improve international laws to combat money laundering and the financing of terrorism and foster the implementation of domestic programs.
- B. To improve cooperation with state and federal governments in the fight against money laundering and the financing of terrorism and to foster the implementation of domestic programs in this field.
- C. To improve communication with law enforcement in the fight against money laundering and the financing of terrorism and to foster the implementation of domestic programs in this field.
- D. To provide a forum for FIUs to improve cooperation in the fight against money laundering and the financing of terrorism and to foster the implementation of domestic programs in this field.
Answer: D
NEW QUESTION # 309
Which three procedures should a compliance officer looking to revise an institution's CTF efforts include in accordance with the Wolfsberg Group's Statement on the Suppression of the Financing of Terrorism?
- A. Reporting matches from lists of known or suspected terrorists to relevant authorities
- B. Reviewing only original identification documents when verifying customers
- C. Consulting applicable lists and taking appropriate actions to determine if customers appear on such lists
- D. Maintaining customer information to facilitate timely retrieval of such information
Answer: A,C,D
Explanation:
Explanation
UNUSUAL CUSTOMER IDENTIFICATION CIRCUMSTANCES
* Customer furnishes unusual or suspicious identification documents or declines to produce originals for verification."
NEW QUESTION # 310
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