Latest CAMS Dumps Questions [2022] Pass Certified Anti-Money Laundering Specialist Exam

Eleanor2024-10-14T15:44:45+00:00

By Eleanor ACAMS

To earn Certified Anti-Money Laundering Specialist (CAMS) certification can help you prove yourself due to the CAMS is recognized as the gold standard in AML certifications by institutions, governments and regulators worldwide. As the most popular IT certification, there are many candidates planning to complete. But how? Choosing CAMS dumps questions to learn the latest exam questions and answers before attending the actual CAMS Certified Anti-Money Laundering Specialist certification exam is highly recommended, and it will be considered as the most effective way to prepare for CAMS exam well.

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1. A government has instituted new anti-money laundering laws which require all financial institutions to obtain certain information from its customers.

Which step should an institution located in this jurisdiction take to ensure compliance?

Change procedures to require that the necessary information is obtained

Change procedures and systems as necessary and provide employee training

Send a notice to customers asking them to provide the necessary information

Change systems to ensure the required information is automatically obtained from all customers

2. When should the anti-money laundering risk assessment be updated?

Every two years

After a merger or acquisition

When the board of directors changes

When instructed to by the Financial Action Task Force

3. In which two ways does a government Financial Intelligence Unit interact with public and private sectors? (Choose two.)

It governs the methods of investigation used by competent authorities

It mediates disputes between financial institutions and investigative authorities

It receives and analyzes disclosures filed by financial and non-bank institutions

It disseminates information and the results of its analysis to competent authorities

4. What is an example of the integration stage of money laundering involving a bank or another deposit-taking institution?

Depositing illicit funds into an account set up for a front company

Directing third parties to exchange illicit cash for negotiable instruments

Wiring illicit funds from an account at one bank to an account at another bank

Using illicit funds that had previously been deposited to purchase a luxury vehicle

5. A customer living in a high-risk jurisdiction makes frequent, large cash deposits at a bank. The same customer sends small wire transfers to unrelated parties in other high-risk jurisdictions.

What are two red flags that may indicate money laundering? (Choose two.)

The bank allows cash deposits

The client resides in a high-risk jurisdiction

Wire transfers are to high-risk jurisdiction

Large cash deposits are from a high-risk jurisdiction

6. What do Financial Action Task Force (FATF)-style regional bodies do for their members to help combat money laundering and terrorist financing?

They provide technical assistance to members in implementing FATF recommendations

They assist member countries in penalizing entities that violate FATF standards and recommendations

They work with members on areas of concern outside of anti-money laundering and terrorist financing

They supervise member country financial institutions relating to anti-money laundering and terrorist financing

7. The compliance officer at a crowdfunding website is in charge of monitoring new crowdfunding projects. Recently, the number of crowdfunding projects has significantly increased.

Which red flag indicates the highest anti-money laundering risk?

Those with the largest number of donors

Projects that get funding within days of their start

Projects with the highest monetary success threshold

Projects that start and close and are fully funded within a very short period

8. 1.A bank account is established for a new business customer. The business was established five years ago with an address in another state. The business website contains few details other than stating it is a real estate business.

One principal has an international telephone number and appears to be living in another country. The other principal works out of a recreational vehicle.

What warrants enhanced due diligence in this scenario?

Shell company

Human trafficker

Politically exposed person

Money laundering through real estate

9. Which method to launder money through deposit-taking institutions is closely associated with international trade?

Forming a shell company

Using Black Market Peso Exchange

Structuring cash deposits/withdrawals

Investing in legitimate businesses with illicit funds

10. 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?

Determining that a local figure is a PEP

Reviewing when a relationship is established

Reviewing relationships at account opening and on a periodic basis

Requiring that the customer discloses that they are a PEP or an associate of a PEP

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11. Upon a routine account review a money laundering investigator identified a number of large round dollar wire transfer deposits into a business account owned by a local auto repair shop. The wire transfers all originated from a country that is a known financial secrecy haven with poor anti-money laundering controls. The investigator concludes there appears to be no legitimate business purpose for the wire transfers and files a suspicious transaction report. The owner of the auto repair shop is popular in the community and is a well-known philanthropist.

To whom should the investigator escalate these concerns?

Audit committee

Chairman of the Board

The owner of the auto repair shop

The bank anti-money laundering officer

12. The USA PATRIOT Act requires United States (U.S.) financial institutions to collect certain information from non-U.S. banks that hold a correspondent account.

Which two pieces of information must a non-U.S. bank provide to its U.S. correspondent to enable them to comply with this requirement? (Choose two.)

The name and address of all shell banks the bank maintains accounts for

The name and address of all beneficial owners who own 25% or more of the bank

Prompt notice of any suspicious activity it detects on any customer who uses the correspondent account

The name and address of a

person who is authorized to receive service of legal process for the bank

13. What is an essential element of Know Your Customer (KYC) standards according to the Basel Committee’s Customer Due Diligence for Banks paper?

Annual staff training

A customer acceptance policy

The same KYC requirements must be applied in all cases

All completed KYC documents must be reviewed by a senior manager not involved in the account opening process

14. A foreign bank operating under an offshore license wants to open a correspondent account with a United States (U.S.) bank. The foreign bank plans to provide payable through account services to some of its customers.

What must the foreign bank provide to the U.S. bank under the USA PATRIOT Act?

A list of politically exposed persons who are owners of the correspondent bank

A list of account holders at the financial institution who will use the payable through account

The person in the United States who can receive service of legal process for the correspondent bank

A list of anti-money laundering training records for the financial institution employees monitoring payable through account transactions

15. What is a key risk associated with Correspondent Accounts according to the Basel Customer Due Diligence paper?

It is not used on a daily basis

The service fees are insufficient to cover the cost of managing the account

The respondent bank’s customer acceptance and know your customer policies are ineffective

The volume and value of transactions passing through the account may not be in line with the original correspondent agreement

16. An automotive parts company in South America sends multiple $500,000 wire transfers per week to ABC Holdings Ltd. in Asia referencing payment for silk flower shipments. Research reveals Sunrise Holdings, Ltd is registered in the British Virgin Islands with no available ownership information.

What are two red flags that indicate how trade-based money laundering could be occurring in this instance? (Choose two.)

The transaction involves the use of front (or shell) companies

The packaging is inconsistent with the commodity or shipping method

Significant discrepancies appear between the description of the commodity on the bill of lading and the invoice

The type of commodity being shipped appears inconsistent with the exporter or importer’s regular business activities

17. An employee hears a colleague on the telephone with a customer giving advice on how to ensure that a suspicious transaction report will not be filed as a result of a future transaction.

What action should the employee take?

Report the conversation to the local police

Report the conversation to the compliance officer

Tell the colleague that it is against policy to give such advice

Ignore the situation because the colleague is the relationship manager for that customer

18. A customer opens a corporate account with a broker-dealer on behalf of several beneficial owners, with a stated long-term investment goal. The customer deposits $25.5 million into the account and three days later transfers $5 million to an overseas bank. Shortly thereafter, the customer begins making numerous purchases of pesos. The compliance officer receives a query regarding the movement of funds. Within a month of account opening, the customer depletes the account.

Which two red flags should prompt the firm’s compliance officer to take action? (Choose two.)

The new account deposit is $25.5 million

A corporate account is opened on behalf of several beneficial owners

The compliance officer receives the query regarding the movement of funds

The customer’s stated investment goal is not reflective of account activity

19. A non-U.S. bank wants to open an account at Bank A, which is a U.S.-based bank.

Which information must Bank A obtain under the USA PATRIOT Act?

A complete client list from the non-

bank

The identity of owners and percentage of ownership of the non-

bank

The structure and identity of the management team at the non-

bank

The details of the non-

bank’s anti-money laundering compliance training program

20. An organization’s automated surveillance system identifies large fluctuations in customer activity. As a result of an audit, the compliance officer is informed that the system is not generating alerts when activity is consistently abnormal over a long period of time. Currently the organization is evaluating new alert scenarios in an attempt to address this problem.

Which type of scenario is helpful in mitigating this weakness?

Peer

Income

Mapping

Below-the-line

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21. A law enforcement official calls a bank inquiring about a customer who is currently under investigation. The law enforcement official requests information about the customer.

How should the bank respond?

Confirm the customer is either a current or former customer

Inform the board of directors before responding to the request

Provide the requested information to help aid in the investigation

Request a formal letter be submitted to verify the validity of the request

22. A politically exposed person (PEP) maintains an account at a bank. Last month a money laundering analyst filed a suspicious transaction report about unusual wire deposits originated by unknown individuals in the home country of the official.

To whom should this situation be escalated?

The board of directors

The line of business executive

The bank’s anti-money laundering officer

The Financial Action Task Force’s PEP Hotline

23. What should countries do to help prevent non-profit organizations from being abused for the financing of terrorism according to the Financial Action Task Force 40 Recommendations?

Allow for freezing assets of non-profit organizations

Require all non-profit organizations to register with the country’s financial intelligence unit

Ensure non-profit organizations cannot be used to conceal or obscure the diversion of funds intended for legitimate purposes to terrorists’ organizations

Create laws that forbid non-profit organizations from completing cross-border transactions without first running them through known terrorist data bases

24. A retail bank has just acquired a credit card business. The bank’s anti-money laundering policy requires that new employees are trained within 30 days of their hire date and refresher training is delivered to all employees on an annual basis.

Is the bank’s existing anti-money laundering training adequate to be delivered to employee of the newly acquired credit card business?

Yes, the existing training covers the bank’s policies, procedures, and processes.

No, anti-money laundering training needs to be delivered face-to-face for credit card businesses.

No, anti-money laundering training needs to be tailored and focused on the risks specific to the business.

Yes, the existing training covers the anti-money laundering regulations that the bank is required to follow.

25. Which two factors assist a money laundering investigation that involves multiple countries? (Choose two.)

Law enforcement and other authorities should have access to financial information that is pertinent to the investigation.

Every country should share all their information with foreign law enforcement and government authorities to facilitate rapid investigations.

Law enforcement and other authorities should be allowed to establish and utilize joint investigative teams with law enforcement in other countries.

Law enforcement and other authorities should not expedite information sharing between countries to ensure that all information is provided at the same time to avoid premature conclusions.

26. The branch manager notices that a number of customers come in weekly and always use the same teller to process their deposits. The manager notices that the customers and the teller, who are from the same ethnic group, are speaking in a foreign language and every once in a while the customers from local ethnic restaurants will bring the teller lunch. The commercial customers that visit the teller generally deposit the same amount of cash each time they come in.

How should the branch manager respond to this activity?

Transfer the teller to another branch

Conduct further investigation before taking any other action

Encourage the teller to bring in more business from the ethnic community

Suggest to the teller to send the customers to other tellers to avoid the opportunity for collusion

27. The vice president of the foreign correspondent banking department at a large United States bank has been notified that a foreign bank with an offshore license wants to open a correspondent account.

Which two things must the vice president acquire under the USA PATRIOT Act? (Choose two.)

A list of all the customers of the correspondent bank

A list of the types of businesses served by the correspondent bank

Information relating to the foreign bank’s anti-money laundering program

The identity of 10% owners of the correspondent bank, unless it is publicly traded

28. A compliance officer learns from an Information Technology (IT) source of a potential new financial service being discussed by the new product approval committee.

What is the correct next course of action?

Request that the new product approval committee include the compliance officer.

Go to the board of directors and try to shut the new service down immediately because the committee did not communicate with the compliance officer.

Get as much information as possible from the source so that potential risks can be researched and a report prepared and presented to the head of marketing.

Start initial research into potential risks but wait until notified that the service has been approved by the committee before initiating extensive research.

29. A bank compliance officer has implemented enhanced monitoring rules that have identified some unusual activity that may be indicative of human trafficking.

Which red flag should prompt additional transactional review?

Wire transfer activity from countries with significant migrant populations

Cash deposits that occur in cities where the customer resides and conducts business

Cash deposits that occur in cities where the customer does not reside or conduct business

Cash deposits that occur in cities where the customer does not reside or conduct business followed by same-day withdrawals

30. A customer brings $15,000 worth of chips into a casino and plays various games. The customer redeems all the remaining chips and requests a wire transfer of the proceeds to an unrelated third party.

What are two red flags that indicate money laundering? (Choose two.)

Customer redeeming all remaining chips

Playing various games before cashing out

Bringing $15,000 worth of chips into the casino

Requesting a wire transfer to an unrelated third party

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31. What are two requirements with respect to supporting documentation that is used to identify potentially suspicious activity, according to Financial Action Task Force? (Choose two.)

It must be retained for at least five years

It must be retained for at least seven years

It must be kept in a manner so that it can be provided promptly

It must only be released to the government through a subpoena process

32. A new compliance officer is reviewing the bank’s anti-money laundering program and notices that the risk assessment was completed six months ago. Since that time, the bank acquired another financial institution, re-named the internal records group, and streamlined cash handling procedures.

Which factor causes the compliance officer to update the bank’s risk assessment?

The bank acquired another institution

The internal records group has been re-named

The cash handling procedures were streamlined

The risk assessment was completed six months ago

33. Which three methods are commonly used by an accountant to launder money? (Choose three.)

Representing a client in court

Understating income to take a tax loss

Overstating income to hide excess cash

Acting as a conduit for transferring cash between accounts

Acting as a designee for someone who wishes to hide their identity

34. An immigrant residing in the United States opens a bank account that includes a debit card. Several months later, the transactional monitoring system identifies small deposits into the account followed by corresponding ATM withdrawals from a country bordering a conflict zone.

How should the bank respond?

Block any further activity

File a suspicious transaction report

Initiate an investigation into the activity

Contact the customer if the transaction activity continues

35. Which two individuals are ordinarily beneficial owners of a private banking account according to the Wolfsberg Anti-Money Laundering Principles for Private Banking? (Choose two.)

Those who are authorized signers on the account

Those who have legal title to a controlling share interest in the customer

Those who generally have ultimate control through ownership or other means over the funds in the account

Those who are the ultimate source of funds for the account and whose source of wealth should be subject to due diligence

36. What are two sources for maintaining up-to-date sanctions information? (Choose two.)

Federal Bureau of Investigation’s National Security Letters

Department of the Treasury Office of Foreign Assets Control

Department of the Treasury C Section 311 C Special Measures

Financial Action Task Force’s list of High Risk and Non-Cooperative Jurisdictions

37. 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.)

Financial institutions need to assist competent authorities in fighting terrorist financing through prevention, detection and information sharing.

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.

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.

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.

38. What are two requirements for monitoring and reporting suspicious activity for correspondent banking according to the Wolfsberg Principles? (Choose two.)

Incorporate suspicious activity monitoring into periodic reviews

Incorporate due diligence results such as customer risk ratings

Utilize downstream correspondents to investigate and report suspicious activity

Investigate and report suspicious activity only for the correspondent bank’s clients

39. In the summer, an institution identifies anti-money laundering concerns regarding a customer’s account activity. The customer, an ice cream parlor, has deposited a lot of checks drawn on banks in foreign countries, sent large number of high dollar international wires to different countries, made cash deposits of a few hundred dollars every few days and written multiple checks for a few hundred dollars to the same dozen payees every two weeks.

Which two transaction types warrant investigation? (Choose two.)

Regular cash deposits

The wires to foreign countries

Repeated checks to the same payees

Checks drawn on banks in foreign countries

40. A popular restaurant in town has begun depositing less cash than it has in prior years. In a review of the customer’s accounts, you notice that credit card receipts have increased with no explanation.

The account officer discovers that the restaurant has installed a privately-owned automated teller machine (ATM) onsite and has begun construction of a patio dining area.

Which red flag should trigger additional investigation?

Privately-owned ATM

Lower cash deposits

Increased credit card receipts

Construction of the new patio dining area

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41. Which aspect of the USA PATRIOT Act impacts foreign financial institutions?

Requiring enhanced due diligence for foreign shell banks

Expanding sanctions requirements to a

financial institution’s foreign branches

Expanding the anti-money laundering program requirements to all foreign financial institutions

Providing authority to impose special measures on institutions that are of primary money-laundering concern

42. What are the regulatory risks to a bank employee who willfully violates anti-money laundering laws?

Investigation and reputational damage

Fines and suspension from the industry

Criminal investigation and imprisonment

Enforcement actions including fines against the financial institution

43. Which two factors should increase the risk of a correspondent bank customer and require additional due diligence according to the Wolfsberg Anti-Money Laundering Principles for Correspondent Banking? (Choose two.)

The customer is located in a Financial Action Task Force member country and provides services primarily to a local individual customer.

The customer is located in a Financial Action Task Force member country and the bank’s head of information security is a politically exposed person.

The customer is located in a Financial Action Task Force member country and provides services to other correspondent banks in neighboring countries.

The customer is located in a non-Financial Action Task Force member country and services mostly commercial customers who engage in international trade.

44. Which insurance product is particularly vulnerable to money laundering?

Annuity

Casualty

Collateral

Regulated pension

45. A branch manager for a small community bank has a new customer who deposits four EUR 50,000 checks into one account. Shortly thereafter, the customer goes to another branch and asks to transfer all but EUR 1,500 to three accounts in different foreign jurisdictions.

Which suspicious activity should be the focus of the suspicious transaction report?

The customer opened the account with four large checks

The customer goes to a different branch to make this transaction

The customer transfers almost all of the funds out of the account

The customer asks to transfer funds to accounts in three different foreign jurisdictions

46. A United States (U.S.) bank was recently alerted by law enforcement of an increase in sale of large denomination U.S. bank notes to casas de cambio. They suspect that a Mexican syndicate is operating a money laundering scheme in the bank’s jurisdiction.

Which two steps should be taken to trace funds through the bank to assist law enforcement in their investigation? (Choose two.)

Identify the money laundering scheme and submit a suspicious transaction report

Identify if there is a decrease in the sale of large denomination

bank notes to casas de cambio by the bank

Identify deposits by casas de cambio that include third-party items including sequentially numbered monetary instruments

Identify multiple wire transfers initiated by casas de cambio to jurisdictions outside of Mexico that bear no apparent business relationship with that casa de cambio

47. A bank has maintained an account for a European charity for several years. The charity provides clothing to persons in need in various countries with active terrorists’ cells.

Which action by the charity indicates possible terrorist financing?

The charity frequently withdraws cash from the bank

The charity has branch locations located in various countries

The charity receives cash donations primarily from European countries

The charity maintains a bank account for non-business-related expenses

48. An institution has made the decision to exit a client relationship due to anti-money laundering concerns. Prior to starting the close out process, the institution receives a written request from a law enforcement agency to keep the account open. The client is the subject of an ongoing investigation and law enforcement wants the institution to continue to monitor the account and report any suspicious activity.

What is a primary consideration the institution should keep in mind when deciding whether to agree to this request?

The anticipated cost of complying with the law enforcement request

The number of suspicious transaction reports previously filed on the client

The fact that the institution has a solid record in complying with law enforcement requests

Whether the institution can continue to meet its regulatory obligations with the accounts open

49. The compliance officer for a private bank has been tasked with writing a policy on how the bank will deal with intermediaries.

Which two aspects should be included in the policy in respect of intermediaries to align it with the Wolfsberg Anti-Money Laundering Principles for Private Banking? (Choose two.)

When an intermediary introduces clients to the bank, it is not necessary for the bank to perform due diligence on the intermediary’s clients.

Where an intermediary introduces clients to the bank, the bank must obtain the same type of information with respect to an introduced client that would otherwise be obtained by the bank, absent the involvement of the intermediary.

Where an intermediary manages assets on behalf of a number of clients and is the account holder with the bank, but that intermediary does not conduct the same level of due diligence as the bank, it is necessary for the bank to undertake due diligence on the intermediary’s clients.

Where an intermediary manages assets on behalf of a number of clients and arranges for the opening of accounts for its clients with the bank, and that intermediary is a financial institution subject to similar regulations, it is necessary for the bank to perform due diligence on the intermediary’s clients.

50. Which method do terrorist financiers use to move funds without leaving an audit trail?

Extortion

Cash couriers

Casa de cambio

Virtual currency

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51. A bank located in Arizona is considering a loan application for a new client. The collateral for the loan is a property in Florida.

The loan will be in the name of a limited company (LLC) whose ownership is not disclosed to the bank. The LLC was established by a New York-based attorney.

The loan will be repaid by the LLC in monthly wire transfers of $9,000 which is more than the required monthly payment.

Which aspect indicates the potential for money laundering?

The LLC’s ownership is not disclosed to the bank

The collateral, a property in Florida, is not located in Arizona

The repayment in the amount of $9,000 indicates potential structuring

The attorney associated with the account is outside the bank’s lending area

52. A compliance officer at an insurance company has been reviewing the transaction activity of several clients.

Which transaction is considered a red flag for potential money laundering?

A client paid the quarterly life insurance premium using money orders from two different banks.

A client from a high-risk jurisdiction recently purchased property insurance for a real-estate development.

A corporation owns several affiliates and recently opened separate group life insurance policies for each of the affiliates.

A client established a $100,000 charitable annuity with a non-profit organization that provides health and safety assistance internationally.

53. An anti-money laundering audit identifies a significant weakness in how transaction monitoring alerts are cleared. Audit sampling identified potentially suspicious activity that was cleared as not suspicious. Management accepts the audit finding and develops a remediation plan.

What is the role of the auditor during the correction phase?

Directing the remediation of the deficiency in a timely manner

Developing procedures to provide sufficient risk-based documentation for clearing alerts

Providing training to the alert clearing department on the importance of effective alert clearing

Validating the successful remediation of the issue once management indicates the issue is resolved

54. What are two legal risks of having inadequate privacy policies and procedures? (Choose two.)

Diminished reputation

Industry of regulatory sanctions

Charges of deceptive business practices

Higher marketing and public relations costs

55. In reviewing recent activity, a compliance officer for a money transmitter that several customers are each remitting the same amount of money but much more frequently.

How should the institution respond?

File a suspicious transaction report

Instruct the tellers not to process remittances for these customers in the future

Conduct further investigation to determine whether this is truly suspicious activity

Immediately contact the customers and ask them why they are remitting money more often

56. Why do governments and multi-national bodies impose economic sanctions?

To impede kleptocracy

To enforce foreign policy objectives

To combat an imminent terrorist threat

To prevent fraudulent international trade transactions

57. A law enforcement agency is reviewing a suspicious transaction report (STR) filed by a financial institution for suspicious activity on a client’s account. Subsequently, the agency requests further information.

Which supporting documentation might the law enforcement agency request from the institution to facilitate its investigation?

Previously filed STRs on the same customer

Account opening documents and account statements

Copies of promotional materials sent to the customer

A copy of the institution’s STR policy and procedures

58. What is the goal of the Egmont Group in providing a forum for Financial Intelligence Units (FIUs) around the world?

To improve international laws to combat money laundering and the financing of terrorism and foster the implementation of domestic programs.

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.

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.

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.

59. The Wolfsberg Anti-Money Laundering Principles for Private Banking require new clients to be approved by whom?

The board of directors

Only the private banker

The private banker’s supervisor

At least one person other than the private banker

60. What are two reasons physical certificates present a money laundering risk to broker-dealers? (Choose two.)

The trade information on a physical certificate can be easily altered

Physical certificates do not expire and may be held by the owner for perpetuity

There is little information readily available to the broker confirming the source of the funds

Physical certificates may be provided to nominees for deposit or settled in off-market transactions

Latest CAMS Dumps Questions [2022] Pass Certified Anti-Money Laundering Specialist Exam