ACAMS Certified Anti-Money Laundering Specialist v6 Exam Practice Test

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Question 1

Which of the following indicates potential money laundering activity by a lawyer?

AA lawyer's trust account regularly receives wire transfers from unknown remitters from a higher-risk country and immediately transfers the same amount of funds to a known beneficiary's account in a low-risk country.

BA lawyer located in a higher-risk country deposits their firm's bank draft issued from their trust account to another lawyer's trust account located in a low-risk country for legal services rendered.

CA lawyer's trust account receives a large-value wire transfer from a regulated insurance company and immediately transfers the same amount of funds received to the beneficiary's bank account in a low-risk country.

DA lawyer's trust account receives a large wire transfer deposit from a client that wanted to purchase a piece of property and then transfers the same amount to the property seller's lawyer's trust account.

Answer : A

Lawyers and legal professionals are frequently used in money laundering schemes, particularly through trust accounts that offer anonymity and client privilege protections.

Option A (Correct): Repeated wire transfers from unknown sources followed by immediate outward transfers suggest that the lawyer's trust account is being used as a pass-through account for laundering funds.

Option B (Incorrect): If legal services were actually rendered, this is a normal transaction unless other risk factors exist.

Option C (Incorrect): Receiving funds from a regulated insurance company is not inherently suspicious, unless the transaction is inconsistent with the lawyer's usual business activity.

Option D (Incorrect): Large transactions are normal in real estate purchases, as long as proper documentation exists.

Red Flags in Legal Sector Money Laundering:

Use of lawyer trust accounts to move funds with no legitimate business purpose.

Frequent transactions from high-risk jurisdictions.

Transactions that are inconsistent with the lawyer's area of practice.

Clients who refuse to disclose the source of funds.

Best Practices:

Apply AML measures to law firms handling financial transactions, as required by FATF's Designated Non-Financial Businesses and Professions (DNFBPs) guidelines.

Require enhanced due diligence (EDD) for high-risk clients and unusual transactions.

FATF Report on Legal Professionals & Money Laundering

Wolfsberg Group Legal Sector AML Guidance

6th EU Anti-Money Laundering Directive (6AMLD) on DNFBPs

Question 2

The Basel Committee on Banking Supervision published guidelines on the "Sound Management of Risks Related to Money Laundering and Financing of Terrorism."

With regard to identifying and accepting customers, it recommends that banks: (Select Two.)

AEstablish policies and procedures for customer due diligence that vary based on risk.

BAre prohibited from offering numbered accounts to customers, even if procedures are established to gather and maintain due diligence information.

CEstablish policies and procedures to identify and verify customers, beneficial owners, and any individuals that can transact on behalf of their customers.

DEstablish policies and procedures to ensure due diligence activities are identical for all customers.

EEstablish policies and procedures that encourage processing transactions while due diligence information is being established and verified.

Answer : A, C

The Basel Committee's AML guidelines emphasize risk-based customer due diligence (CDD) and beneficial ownership transparency.

Option A (Correct): CDD policies must be risk-based to apply enhanced due diligence (EDD) for high-risk customers and simplified due diligence (SDD) for low-risk customers.

Option C (Correct): Banks must verify the identity of customers and beneficial owners to prevent financial crime risks.

Why Other Options Are Incorrect:

Option B (Incorrect): Numbered accounts are not strictly prohibited but require strict transparency and due diligence measures.

Option D (Incorrect): CDD procedures must be risk-based, not uniform across all customers.

Option E (Incorrect): Transactions should not be processed until full due diligence is completed, except in rare cases where regulatory exceptions apply.

Best Practices for Risk-Based Customer Due Diligence:

Apply EDD for high-risk entities (e.g., PEPs, offshore companies).

Ensure full beneficial ownership transparency.

Implement ongoing transaction monitoring for risk assessment.

Basel Committee's ''Sound Management of ML/TF Risks''

FATF Recommendation 10 (Customer Due Diligence)

6th EU AML Directive (6AMLD) on Beneficial Ownership Transparency

Question 3

Bank A is a non-United States (U.S.) bank that has $5 million in a correspondent account at a bank in New York City. The Worldwide Terrorist Syndicate (WTS) has $1 million in its account at a non-US branch of Bank A. The U.S. government has initiated forfeiture action against the WTS.

Which potential action can the U.S. take under the USA PATRIOT ACT pursuant to the issuance seizure warrant?

ASeize Bank A's $5 million correspondent account in the U.S.

BSeize WTS' $1 million account at the non-U.S. branch of Bank A.

CSeize $1 million from Bank A's correspondent account in the U.S.

DSeize $5 million from the non-U.S. branch of Bank A where the WTS' account is located.

Answer : C

This potential action is authorized by Section 319 of the USA PATRIOT ACT, which allows the U.S. government to seize funds from a foreign bank's correspondent account in the U.S. if the foreign bank refuses to cooperate with a request for records relating to an investigation of money laundering or terrorist financing. The U.S. government can seize an amount equal to the funds in the account of the target of the investigation, regardless of whether those funds are actually in the correspondent account. In this case, the U.S. government can seize $1 million from Bank A's correspondent account in the U.S. because Bank A holds $1 million in the account of the WTS, which is the target of the forfeiture action.

The other potential actions are not authorized by the USA PATRIOT ACT or other U.S. laws. The U.S. government cannot seize Bank A's entire $5 million correspondent account in the U.S. because that would exceed the amount in the WTS's account and would violate the principle of proportionality. The U.S. government cannot seize the WTS's $1 million account at the non-U.S. branch of Bank A because that would require the cooperation of the foreign jurisdiction where the branch is located, which may not be forthcoming. The U.S. government cannot seize $5 million from the non-U.S. branch of Bank A where the WTS's account is located because that would also require the cooperation of the foreign jurisdiction and would exceed the amount in the WTS's account.

CAMS Certification Package - 6th Edition | ACAMS, Chapter 3: International Standards and Global Initiatives, pp. 67-68

CAMS Certifications: How to Get CAMS Certified | ACAMS, CAMS Study Guide, pp. 54-55

How Does the Patriot Act Affect Criminal Investigations? | Nolo, Section 319: Forfeiture of Funds in United States Interbank Accounts

The USA PATRIOT Act at 20: Sneak and Peek Searches - CRS Reports, Section 319: Forfeiture of Funds in United States Interbank Accounts

Question 4

Which scenario is closest to the definition of money laundering the United Nations Convention against Transnational Organized Crime and Other Protocols provided?

AFiling a suspicious transaction report when you know or suspect money laundering is taking place

BKnowingly financing a resort development with the proceeds of arms trafficking

CAssisting a client in a property conveyance by effecting the transfer of ownership from the seller to the purchaser when you don't know the purchaser

DDiscussing your suspicions with a client, thus giving the client the opportunity to switch service providers and to cover his tracks in future transactions

Answer : B

Option B is closest to the definition of money laundering provided by the United Nations Convention against Transnational Organized Crime and Other Protocols, which states that money laundering is ''the conversion or transfer of property, knowing that such property is the proceeds of crime, for the purpose of concealing or disguising the illicit origin of the property or of helping any person who is involved in the commission of the predicate offence to evade the legal consequences of his or her action''. In this scenario, the person is knowingly financing a resort development with the proceeds of arms trafficking, which is a crime, and thus concealing or disguising the illicit origin of the property.

CAMS Certification Package - 6th Edition | ACAMS1

CAMS Certifications: How to Get CAMS Certified | ACAMS2

ACAMS CAMS Certification Video Training Course - Exam-Labs3

Exam CAMS: Certified Anti-Money Laundering Specialist (the 6th edition)4

United Nations Convention against Transnational Organized Crime and the Protocols Thereto

Question 5

Based on studies executed by the Organization for Economic Cooperation and Development (OECD), which occupations are particularly vulnerable to the use of false identities and identity theft?

AGovernment officers

BSea port officers

CLawyers

DLaborers

Answer : A

According to a report by the OECD, government officers are among the occupations that are particularly vulnerable to the use of false identities and identity theft. This is because government officers have access to sensitive and confidential information, such as personal data, tax records, social security benefits, passports, visas, and licenses. Identity fraudsters may target government officers to obtain or alter such information, or to impersonate them to access restricted areas or systems.Identity fraud involving government officers may facilitate tax evasion, money laundering, corruption, terrorism, and other crimes1.

Some examples of identity fraud schemes involving government officers are:

Rogue agents in the immigration services sector who issue fake or fraudulent documents, such as passports, visas, or residence permits, to facilitate the entry or stay of illegal immigrants, criminals, or terrorists12.

Corrupt tax officials who use false identities to create fictitious taxpayers or employers, or to modify tax records, to evade taxes or to claim fraudulent refunds or credits13.

Impostors who pose as government officers, such as police, customs, or revenue agents, to extort money or information from unsuspecting victims, or to access secure facilities or databases1.

REPORT ON IDENTITY FRAUD: TAX EVASION AND MONEY LAUNDERING VULNERABILITIES

Identity Fraud and Immigration Services

Identity Theft and Tax Fraud

[Identity Theft and Government Impersonation Scams]

Question 6

One area of responsibility for the Board of Directors when implementing a successful AML program is to:

Aensure the appointment of a qualified chief AML officer.

Bcreate a culture of compliance based on the profit expectation.

Cmanage the day-to-day processes of the compliance program.

Dhire a third-party firm to be responsible for the AML compliance.

Answer : A

The Board of Directors is the primary governing body of a financial institution and has the fiduciary duty to oversee and approve the BSA/AML compliance program. One of the key responsibilities of the Board is to ensure the appointment of a qualified chief AML officer who has the authority, expertise, and resources to implement and manage the BSA/AML program effectively. The chief AML officer is accountable to the Board and senior management for the performance of the BSA/AML program and should report regularly on the status, issues, and challenges of the program. The Board should also evaluate the chief AML officer's performance and provide feedback and guidance as needed.

The Board's Role in AML Compliance

Board Member Responsibilities for BSA/AML Compliance

Responsibilities of the Board of Directors in Implementing a Successful AML Program

Question 7

An anti-money laundering specialist working at a bank just received a legal request from a law enforcement agency mandating the release of all financial transaction records relating to an account at the bank. The specialist immediately recognizes the account as one owned by the bank Chief Executive Officers brother. During research to gather the requested documents, the specialist finds several internal memos he had sent to the bank president with concerns regarding possible suspicious activity relating to this account. The specialist recalls the bank president verbally responded to each memo with an explanation of the activity and indicated there was no cause for concern. What should the specialist do with respect to these internal memos?

APlace these memos in his personal files in case they are subsequently requested

BAsk the bank president to document his instructions to the specialist

CCall the law enforcement agent and suggest he modify the legal request to include these memos

DAdvise the bank's senior legal advisor of the situation

Answer : D

the specialist should inform the bank's senior legal advisor of the situation and seek guidance on how to handle the legal request and the internal memos. The specialist should not take any action that could compromise the integrity of the legal request, the bank's anti-money laundering program, or the specialist's own professional obligations. The specialist should not place the memos in his personal files, as this could be seen as hiding or tampering with evidence. The specialist should not ask the bank president to document his instructions, as this could create a conflict of interest or a perception of undue influence. The specialist should not call the law enforcement agent and suggest he modify the legal request, as this could be seen as interfering with the investigation or tipping off the account holder.

Legal Sector Affinity Group (LSAG) Anti-Money Laundering Guidance for the Legal Sector (January 2021) p.1321

ACAMS: Certified Anti-Money Laundering Specialist | ACAMS2

Anti-Money Laundering -- The Law Society of Singapore3