Acams CAMS-FCI Exam Practice Test Instant Access

Question 1

CLIENT INFORMATION FORM Client Name: ABC Tech Corp Client I.D. Number: 08125 Name: ABC Tech Corp Registered Address: Mumbai, India Work Address: Mumbai. India Cell Phone: ***"--- Alt Phone: Email: ********

Client Profile Information:

Sector: Financial

Engaged in business from (date): 02 Jan 2020

Sub-sector: Software-Cryptocurrency Exchange

Expected Annual Transaction Amount: 125.000 USD

Payment Nature: Transfer received from client's fund

Received from: Clients

Received for: Sale of digital assets

The client identified themselves as "Cryptocurrency Exchange" Client has submitted the limited liability partnership deed. However, the bank's auditing team is unable to identify the client's exact business profile as the cryptocurrency exchange specified by the client as their major business awaits clearance from the country's regulator. The client has submitted documents/communications exchanged with the regulator and has cited the lack of governing laws in the country of their operation as the reason for the delay.

Investigators determine the ultimate beneficial owner of ABC Tech Corp is a high-net-worth client. The client owns a real estate agency left to her when her spouse died. The spouse provided seed capital for ABC Tech Corp through a direct 1,000.000 Great British Pound (GBP) deposit.

What additional information would trigger filing a SAR/STR?

AThe client's spouse's source of wealth was a salary of 250,000 GBP per annum for the past 4 years and rental of properties of 150,000 GBP per annum for the past 6 years.

BThe client's current net asset value is 8 million GBP, of which 7.5 million GBP was derived from the inheritance.

CAn open-source search revealed that the client's spouse was a PEP.

DThe funds for the seed capital were in the form of 50 cashier's checks of 10,000 GBP each and 50 money orders of 10,000 GBP.

Answer : D

The additional information that would trigger filing a SAR/STR is the fact that the funds for the seed capital were in the form of 50 cashier's checks of 10,000 GBP each and 50 money orders of 10,000 GBP. This is because this indicates a possible attempt to avoid the reporting threshold of 10,000 GBP for cash transactions, which is a common money laundering technique known as structuring or smurfing12. The other options are not necessarily suspicious, as they do not involve cash transactions or indicate any illicit source of funds. The fact that the client's spouse was a PEP does not automatically make the transaction suspicious unless there are other red flags or risk factors associated with the PEP34

Question 2

In the past 6 months, a small financial institution (Fl) has received regular remittances that are increasing in value from a country with high piracy activity. The Fl's AML officer (AMLO) has also noted that piracy in this country has increased in the same time frame. Which recommendation should the AMLO make?

ARequest the operations department to return inbound remittances when the sender of funds is from this country.

BUpgrade the transaction monitoring system of the Fl to include more fields so that more in-depth information is collected about the inward remittances.

CFile a SAR/STR to the appropriate AML authority immediately.

DConduct an in-depth investigation into accumulated remittance information in the past year to find the trend of such transactions.

Answer : D

Verified Answer: D The recommendation that the AMLO should make is to conduct an in-depth

Remittances data - Migration data portal

Question 3

Due to an ever-diversifying business model and multi-jurisdictional footprint, a casino has decided to outsource the source of funds and wealth checks to a third-party provider. Why is it important for the casino to maintain control of the output from the provider?

AClients of the casino prefer to know that the casino is keeping their information secure when being held by a third-party.

BAs with all third-party relationships, proper control must be maintained to ensure profitability.

CThe casino maintains ultimate responsibility for this activity and should maintain control to avoid non-compliance.

DOther casinos are frequently looking to reduce costs and share ideas, so if this relationship is successful, the model can be used by other businesses.

Answer : C

The reason why it is important for the casino to maintain control of the output from the provider is that the casino maintains ultimate responsibility for this activity and should maintain control to avoid non-compliance . This is because the casino is accountable for its own AML/CFT obligations and cannot delegate or outsource them to a third-party provider. According to the ACAMS Advanced Financial Crimes Investigations Certification Study Guide1, ''the FI should ensure that it has adequate oversight and control over any third-party providers that it engages for AML/CFT purposes, such as conducting due diligence, verifying information, or monitoring transactions'' (p. 25). The FI should also ''review and evaluate the performance and quality of the third-party providers on a regular basis, and address any issues or gaps that may arise'' (p. 25).

The other options are not as relevant or accurate as option C. The clients of the casino prefer to know that the casino is keeping their information secure when being held by a third-party (A) is not a reason why the casino should maintain control of the output from the provider, but rather a customer expectation or preference. As with all third-party relationships, proper control must be maintained to ensure profitability (B) is not a reason why the casino should maintain control of the output from the provider, but rather a general business principle or objective. Other casinos are frequently looking to reduce costs and share ideas, so if this relationship is successful, the model can be used by other businesses (D) is not a reason why the casino should maintain control of the output from the provider, but rather a potential benefit or outcome.

Question 4

During transaction monitoring. Bank A learns that one of their customers. Med Supplies 123. is attempting to make a payment via wire totaling 382,500 USD to PPE Business LLC located in Mexico to purchase a large order of personal protective equipment. specifically surgical masks and face shields. Upon further verification. Bank A decides to escalate and refers the case to investigators.

Bank A notes that, days prior to the above transaction, the same customer went to a Bank A location to wire 1,215,280 USD to Breath Well LTD located in Singapore. Breath Well was acting as an intermediary to purchase both 3-ply surgical masks and face shields from Chin

a. Bank A decided not to complete the transaction due to concerns with the involved supplier in China. Moreover, the customer is attempting to send a third wire in the amount of 350,000 USD for the purchase of these items, this time using a different vendor in China. The investigator must determine next steps in the investigation and what actions, if any. should be taken against relevant parties.

During the investigation, Bank A receives a USA PATRIOT Act Section 314(a) request related to Med Supplies 123. Which steps should the investigator take when fulfilling the request? (Select Three.)

AExit the relationship with the business since it appears that customer is under investigation.

BDo not respond to Financial Crimes Enforcement Network (FinCEN) if the requested information is not present in the financial institution's system of records.

CReview the account(s) activity and proactively file a SAR/STR using the 314(a) request as the basis for the filing.

DReport to Financial Crimes Enforcement Network (FinCEN) that a match was found without revealing any other details.

EReport back to the Financial Crimes Enforcement Network (FinCEN) within 15 days of receipt of the request via a secure internet website.

FSearch its records expeditiously to determine whether it maintains(ed) any accounts for the subject(s) listed in the request.

Answer : D, E, F

According to the FinCEN's 314(a) Fact Sheet1, the steps that the investigator should take when fulfilling the request are:

Search its records expeditiously to determine whether it maintains(ed) any accounts for the subject(s) listed in the request. This is option F.

Report back to the Financial Crimes Enforcement Network (FinCEN) within 15 days of receipt of the request via a secure internet website. This is option E.

Report to Financial Crimes Enforcement Network (FinCEN) that a match was found without revealing any other details. This is option D.

The other options are incorrect because:

Exiting the relationship with the business since it appears that customer is under investigation is not required by the 314(a) program and may interfere with law enforcement's investigation. This is option A.

Not responding to Financial Crimes Enforcement Network (FinCEN) if the requested information is not present in the financial institution's system of records is contrary to the 314(a) program, which requires financial institutions to respond whether or not they have a match. This is option B.

Reviewing the account(s) activity and proactively filing a SAR/STR using the 314(a) request as the basis for the filing is not appropriate, as the 314(a) request itself is not a sufficient reason to file a SAR/STR. The financial institution should only file a SAR/STR if it has its own independent suspicion of money laundering or terrorist financing. This is option C.

Question 5

Which might suggest misuse of crowdfunding resources by a terrorist?

AA small charge at a gas station followed by a large charge at an electronics store

BA large deposit followed by multiple charges at a sporting goods store

CMultiple small deposits followed by a wire transfer to a large well-known international charity

DMultiple small deposits followed by the purchase of airplane tickets >

Answer : D

The purchase of airplane tickets after receiving multiple small deposits from a crowdfunding platform might suggest that the funds are being used to facilitate travel for terrorist purposes. The other options are not necessarily indicative of terrorist financing, as they could be explained by legitimate reasons or other types of financial crimes.

Question 6

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 7

A KYC specialist from the first line of defense at a bank initiates an internal escalation based on a letter of credit received by the bank.

MEMO

To: Jane Doe. Compliance Manager, Bank B From: Jack Brown, KYC Specialist, Bank B RE: Concerning letter of credit

A letter of credit (LC) was received from a correspondent bank. Bank

Ain Country A. in Asia with strict capital controls, providing guarantee of payment to Bank B's client for the export of 10 luxury cars located in Country B. located in Europe. Bank A's customer is a general in the army where Bank A is headquartered.
The information contained in the LC is as follows:
* Advising amount per unit 30.000.00 EU *10 units of BMW
* Model IX3
* Year of registration: 2020
Upon checks on Bank B's client, the exporter mentioned that the transactions were particularly important, and a fast process would be much appreciated in order to avoid reputational damage to the firm and the banks involved in the trade finance process. The exporter has a longstanding relationship with Bank B and was clearly a good income generator. The exporter indicated that, as a general, the importer was trustworthy.
The relationship manager <RM) was contacted to conduct a full review of the exporter and to conduct a site visit.
Feedback from the RM:
The RM contacted the exporter for a client courtesy visit, but it was rearranged four times as the exporter kept cancelling the appointments. When the exporter was finally pinned down for an interview, employees were reluctant to provide clear answers about the basis of the transaction. The employees were evasive when asked about the wider business and trade activity in the country.
Findings from the investigation from various internal and external sources of information:
* There were no negative news or sanctions hits on the exporter company, directors, and shareholders.
* The registered address of the exporting business was a residential address.
* The price of the cats was checked and confirmed to be significantly below the market price of approximately 70,000 EU, based on manufacturer's new price guide.
* The key controllers behind the exporting company, that is the directors and
During the investigation, the investigator determines that a nephew of the general.....

Ashould be treated well to avoid reputational damage to the bank

Bis a high-net-worth individual

Cshould be flagged as a senior PEP.

Dis a trustworthy source.

Answer : C

The investigator should determine that a nephew of the general (Bank A's customer) should be flagged as a senior PEP . This is because the nephew is related to a senior military official who is a customer of Bank A, which is a high-risk jurisdiction with strict capital controls. According to the ACAMS Advanced Financial Crimes Investigations Certification Study Guide1, ''the FI should identify and flag any customers who are PEPs or have close associations with PEPs, such as family members or business partners'' (p. 24). The FI should also conduct enhanced due diligence on these customers and monitor their transactions for any suspicious or unusual activity.

The other options are not correct. The investigator should not determine that a nephew of the general should be treated well to avoid reputational damage to the bank (A), as this could compromise the integrity and objectivity of the investigation, as well as expose the bank to legal or regulatory risks. The investigator should not determine that a nephew of the general is a high-net-worth individual (B), as this is not relevant or material to the investigation, as the nephew's wealth does not affect his potential PEP status or risk level. The investigator should not determine that a nephew of the general is a trustworthy source (D), as this could be biased or inaccurate, as the nephew's trustworthiness does not depend on his relation to the general or his involvement in the transaction.

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