Acams CAMS-FCI Exam Practice Test Instant Access

Question 1

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

AInstructing each member country to place FATF recommendations into law

BImplementing regional mutual evaluation procedures

CEmphasizing regional co-operation between member countries

DEnabling FATF standards to be specific to each region

Answer : B

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 2

A compliance analyst is reviewing the account activity of a customer that they suspect may be indicative of money laundering activity. Which is difficult to determine solely from the customer's account activity and KYC file?

AIf the activity is materially different from related businesses

BIf the account has multiple transfers to the same, related businesses

CIf there is negative media associated with counterparties

DIf the account is mostly dormant or has little activity

Answer : C

According to the Certified Anti-Money Laundering Specialist (CAMS) study guide, 6th edition, page 105, the correct answer is C. It can be difficult to determine if there is negative media associated with counterparties solely from the customer's account activity and KYC file.

The study guide explains that negative media can include news articles, government sanctions lists, and other sources of public information that may indicate that a counterparty is involved in illicit activities. However, this information may not be readily available in a customer's account activity or KYC file, and may require additional research or investigation.

Question 3

How does the Financial Action Task Force (FATF) measure the effectiveness of a country's efforts to combat money laundering and terrorist financing?

AMutual evaluation

BFATF Evaluation Committee

CBasel Committee

DSeries of internal audits followed by reporting to FATF

Answer : A

'The FATF measures the effectiveness of a country's efforts to combat money laundering and terrorist financing through a mutual evaluation process. During a mutual evaluation, the FATF assesses a country's legal and institutional framework, its implementation of measures to combat money laundering and terrorist financing, and the effectiveness of its efforts. The FATF then issues a report with recommendations for improvement' [CAMS Study Guide 6th edition, page 15-16].

Question 4

According to the Financial Action Task Force, as part of their risk assessment, which are important data and information that a Trust and Company Service Provider must understand when establishing and administering a trust? (Select Two.)

AThe responsibility and authority in the structure

BThe management structure of the trust

CThe source of funds in the structure

DThe general purpose behind the structure

EThe general nature of business of the trust

Answer : A, D

Here is the exact information from the Financial Action Task Force (FATF) Guidance for a Risk-Based Approach for Trust and Company Service Providers:

'Understanding the management and ownership structure of a trust is crucial in assessing the ML/TF risk it poses. This includes the identity of all settlors, trustees and beneficiaries, and their respective roles and responsibilities, as well as the nature and purpose of the trust.'

'TCSPs should obtain and maintain up-to-date information on the purpose and intended nature of the business relationship, the source of funds and wealth, and where relevant, the source of funds or wealth of the settlor and beneficiaries.'

Based on this information, the correct answers are A and D. Trust and Company Service Providers must understand the responsibility and authority in the structure, as well as the general purpose behind the structure in order to assess the overall risk of the trust and ensure that any transactions with the trust are legitimate.

Question 5

Online payments from a customer's account to three foreign entities trigger an investigation. The investigator knows the funds originated from family real estate after an investment company approached the customer online. Funds were remitted for pre-lPO shares. Which should now occur in the investigation?

ASeek evidence for the customer's source of wealth.

BHave the relationship manager contact the customer to understand the nature of the transaction.

CReview the structure of the transactions to the three entities.

DInspect electronic banking login records.

Answer : C

The correct answer is C because reviewing the structure of the transactions to the three entities can help the investigator to identify any red flags or indicators of fraud, such as unusual amounts, frequency, destinations, or beneficiaries. The other options are not as relevant or effective in this scenario. Option A is not necessary because the investigator already knows the source of funds for the customer. Option B is not advisable because contacting the customer directly may alert them to the investigation and compromise its integrity. Option D is not helpful because inspecting electronic banking login records does not provide any information about the nature or purpose of the transactions.

Advanced CAMS-FCI Study Guide, page 281

Financial Crime Typologies - Intermediate Certificate Course, Module 32

Question 6

A bank investigator notices an account receiving multiple deposits from the same employer under different employees' names. A cash withdrawal occurs one day after each deposit. The outcome of this investigation will likely uncover which crime typology?

AHuman trafficking

BEnvironmental

CTrade-based money laundering

DBribery and corruption

Answer : D

The correct answer is A because this scenario describes a possible case of human trafficking, which is a crime where people are exploited for labor or sexual services against their will. Human traffickers may use bank accounts to launder their proceeds and pay their victims, and they may use fake or stolen identities to avoid detection. The other options are not likely because they do not explain why multiple deposits from the same employer under different employees' names would occur, nor why cash withdrawals would follow each deposit.

Question 7

The investigations team of a financial institution (Fl) wants to perform enhanced due diligence measures on operations done by a foreign bank related to transactions of companies that export scrap gold and silver. What would be the next best steps for the investigations team? (Select Two.)

AAsk the legal department if it can proceed to rescind the contract of the correspondent banking relationship since the export of scrap gold and silver is a high-risk activity.

BAsk the respondent bank if it has a risk rating for the exporting companies, if the customer profiles are updated, and if so. when was the last time it was done.

CAsk the respondent bank if the exporting companies have obtained an official license that permits the exporting of scrap gold and silver.

DAsk the respondent bank if it can file a SAR/STR in its jurisdiction since the investigations team also plans to do the same in the Fl's home country.

EAsk the business manager who handles the relationship of the respondent bank if they can persuade the bank to close the accounts of the export companies.

Answer : B, C

The correct answers are B and C because these are the most relevant and reasonable steps for the investigations team to perform enhanced due diligence on the operations of the foreign bank and its customers. Asking for the risk rating, customer profiles, and official licenses would help the team assess the level of risk and compliance of the foreign bank and its customers, who are engaged in a high-risk activity of exporting scrap gold and silver. The other options are not appropriate because they are either premature or ineffective. Rescinding the contract, filing a SAR/STR, or closing the accounts would require more evidence and justification, and they may also damage the relationship with the foreign bank.

Acams CAMS-FCI Advanced CAMS-Financial Crimes Investigations Exam Practice Test