Free Mar-2026 CAMS Certification Sample Questions certification Exam
Certification Topics of CAMS Exam PDF Recently Updated Questions
NEW QUESTION # 294
How does the Egmont Group assist financial intelligence unit members to accomplish their goals? (Select Three.)
- A. Provides support to expand and systematize cooperation related to the reciprocal exchange of information
- B. Fosters better and secure communication through the application of technology
- C. Supplies information on the common money laundering tactics used by terrorists and financial supporters of terrorism
- D. Maintains uniform global formats for funds transfers that assist in the detection of money laundering
- E. Encourages operational autonomy of financial intelligence units
- F. Develops official lists of suspected terrorists on a globally coordinated basis by relevant authorities
Answer: A,B,E
Explanation:
Explanation
The Egmont Group assists financial intelligence unit members to accomplish their goals by providing support to expand and systematize cooperation related to the reciprocal exchange of information, fostering better and secure communication through the application of technology, and encouraging operational autonomy of financial intelligence units. Additionally, the Egmont Group also maintains uniform global formats for funds transfers that assist in the detection of money laundering and supplies information on the common money laundering tactics used by terrorists and financial supporters of terrorism.
NEW QUESTION # 295
An analyst reviewing trade finance transactions notices an increase in price of 25% over 12 months for commodities with the same specification and quantity. Which action should the analyst take?
- A. Produce an investigation report that considers client activity and factors that may have legitimately affected transaction cost.
- B. Produce a SAR/STR that describes apparent trade-based money laundering and submit to the Financial Investigation Unit (FIU).
- C. Produce an updated due diligence record for the client so that monitoring can be enhanced.
- D. Produce an investigation report that finds evidence to substantiate the analyst's suspicion and submit a SAR/STR.
Answer: A
Explanation:
Trade finance transactions involve the financing of the movement of goods and services across borders. Trade finance products include letters of credit, guarantees, documentary collections, open account, and supply chain finance. Trade finance transactions are exposed to various risks, such as credit risk, operational risk, fraud risk, and money laundering risk. Money laundering risk refers to the possibility that trade finance transactions are used to conceal the origin, ownership, or destination of illicit funds, or to evade taxes, sanctions, or exchange controls. Trade-based money laundering (TBML) is a form of money laundering that involves the manipulation of trade transactions, such as mispricing, misinvoicing, over- or under-shipping, or falsifying documents, to transfer value or obscure the true nature of the funds12.
An analyst reviewing trade finance transactions should be alert to any red flags or indicators of potential TBML, such as significant discrepancies between the value or quantity of the goods and the invoice, payment, or contract; unusual or complex shipment routes or methods; involvement of high-risk jurisdictions, entities, or commodities; or lack of transparency or documentation of the trade transaction12. If the analyst notices an increase in price of 25% over 12 months for commodities with the same specification and quantity, this could be a sign of mispricing, which is a common technique of TBML. Mispricing involves inflating or deflating the price of the goods to transfer value or evade taxes or duties. For example, an exporter may overprice the goods to move funds out of a country with exchange controls, or an importer may underprice the goods to reduce the customs duty payable12.
However, an increase in price of 25% over 12 months for commodities with the same specification and quantity does not necessarily indicate TBML, as there could be other legitimate factors that may have affected the transaction cost, such as market fluctuations, supply and demand, quality, transportation, insurance, or other fees. Therefore, the analyst should not jump to the conclusion that TBML is occurring, but rather conduct a thorough investigation to verify the validity and rationale of the price change. The analyst should produce an investigation report that considers the client activity and factors that may have legitimately affected the transaction cost, such as:
* The nature and purpose of the client's business and trade activities
* The client's profile, risk rating, and transaction history
* The source and destination of the funds and the goods
* The market price and trends of the commodities involved
* The contractual terms and conditions of the trade transaction
* The supporting documents, such as invoices, bills of lading, certificates of origin, inspection reports, etc.
* The due diligence and verification procedures performed by the bank or the third parties
* The compliance with the relevant laws, regulations, and standards of the jurisdictions involved The investigation report should document the findings, analysis, and conclusions of the analyst, and provide evidence and references to support the assessment. The investigation report should also include any recommendations or actions to be taken by the bank or the authorities, such as:
* Requesting additional information or clarification from the client or the counterparties
* Conducting enhanced due diligence or monitoring of the client or the transaction
* Escalating the case to the senior management or the compliance department
* Reporting the case to the Financial Investigation Unit (FIU) or the relevant regulator
* Filing a Suspicious Activity Report (SAR) or a Suspicious Transaction Report (STR) if there are reasonable grounds to suspect TBML or other criminal activity Therefore, the best action for the analyst to take is to produce an investigation report that considers the client activity and factors that may have legitimately affected the transaction cost, as this would allow the analyst to determine whether the price increase is justified or indicative of TBML, and to take appropriate measures accordingly.
Trade Finance and Trade-Based Money Laundering
Trade-Based Money Laundering: Red Flag Indicators
NEW QUESTION # 296
An account officer who maintains an excellent relationship with the finance manager for a correspondent bank customer learns that many records for the correspondent bank have been requested by law enforcement.
In the interest of maintaining a good relationship with the customer, the account officer sets up a meeting to discuss the legal request with the customer. The account officer intends to discuss points related to the investigation during this meeting. Which of the following should an anti-money laundering specialist recommend?
- A. The meeting should be cancelled as he has already behaved inappropriately by alerting the customer to the investigation.
- B. Discuss all the points being investigated by law enforcement to ensure the correspondent bank is well prepared when approached.
- C. Limit discussions about the investigation with the customer and be satisfied that he has provided proper notice to the customer.
- D. Let his manager know what conversations have taken place with the customer and docu-ment the account file accordingly.
Answer: A
Explanation:
the U.S. government has the authority to seize and forfeit funds in a correspondent account of a non-U.S.
bank if the funds are involved in or traceable to a money laundering offense, regardless of where the offense occurred. This is based on the USA PATRIOT Act, which expanded the definition of "proceeds of specified unlawful activity" to include any property that is derived from or traceable to a foreign offense that would be a predicate offense if committed in the U.S12 References: =
* 1: ACAMS Study Guide for the CAMS Certification Examination, 6th Edition, Chapter 4, page 137
* 2: USA PATRIOT Act, Title III, Section 319(b)
NEW QUESTION # 297
Sanctions screening requirements include that a financial institution should:
- A. report an individual whose name appears on a sanctions list to the police.
- B. immediately close the bank account of an entity who appears on a sanctions list.
- C. immediately freeze the bank account of an individual that appears on a sanctions list.
- D. compare customer and transaction records against periodically updated sanctions lists provided by governmental bodies.
Answer: D
Explanation:
Compare customer and transaction records against periodically updated sanctions lists provided by governmental bodies. This is stated in the Certified Anti-Money Laundering Specialist (the 6th edition) manual on page 595, which states: "Sanctions screening requirements include that a financial institution should compare customer and transaction records against periodically updated sanctions lists provided by governmental bodies."
NEW QUESTION # 298
Which of the following provides anti-money laundering specialists information related to money laundering trends?
1. Egmont Group's 100 Cases
2. Financial Action Task Force Typologies
3. FinCEN's SAR Activity Review
4. The Wolfsberg Principles
- A. 1, 2, and 3 only
- B. 2, 3, and 4 only
- C. 1, 3, and 4 only
- D. 1, 2, and 4 only
Answer: C
NEW QUESTION # 299
How should law enforcement obtain documentation from an institution when suspicious activity was identified? (Choose two.)
- A. Acquire a search warrant to obtain the documents.
- B. Pay an employee of the accountable institution to make copies of the documents.
- C. Request a Financial Intelligence Unit (FIU) share copies of suspicious transaction reports.
- D. Request copies of the relevant documents from the accountable institution.
- E. Request the documents from the FIU.
Answer: D,E
NEW QUESTION # 300
A bank compliance officer discovers cash deposit activity inconsistent with the expected and historical cash activity within the personal accounts of the chairman of the board. The cash activity appears structured to avoid the local legal filing requirements for large cash transactions, and a suspicious transaction report (STR) was filed.
How should the compliance officer report the filing of the STR to the board of directors without revealing the existence of the filing to the subject?
- A. Notify the financial institution's regulator to disclose the activity
- B. Follow the financial institution's established STR reporting policy
- C. The compliance officer and the chief executive officer should jointly interview the chairman
- D. Inform the legal counsel of the bank
Answer: B
Explanation:
The best option for the compliance officer is to follow the financial institution's established STR reporting policy, which should include procedures for reporting suspicious activity involving senior management or board members. This would ensure that the compliance officer acts in accordance with the bank's internal controls and governance, and avoids any potential conflicts of interest or breaches of confidentiality. The other options are not advisable because they could either compromise the integrity of the STR filing, expose the compliance officer to legal or reputational risks, or alert the subject of the investigation.
ACAMS Study Guide for the CAMS Certification Examination, 6th Edition, Chapter 4, page 1401 ACAMS CAMS Certification Video Training Course, Module 4, Lesson 22 ACAMS CAMS Certification Practice Exam, Question 843
NEW QUESTION # 301
Anagent of a wealthy individual from a high-risk country(as per theEU's high-risk jurisdictions list) approaches a notary in anEU countrytodispose of assetsrecently acquired at anauction through an offshore company. The agent holdspower of attorneyfrom alaw firm in another EU country. Thetransfer price is significantly lowerthan the auction price, but the agent refuses to explain the discrepancy.
Which red flags should the notary consider? (Select Two.)
- A. The power of attorney was issued by a law firm in a different EU country from where the transaction took place.
- B. The agent acted on behalf of an individual residing in a high-risk jurisdiction.
- C. The agent requested a disposal of assets at a lower price than recently acquired.
- D. The assets acquired through an auction were put in the name of an offshore company.
Answer: B,C
Explanation:
Thereal estate sectoris a known avenue formoney laundering, and this scenario presents multiplered flags.
* Option A (Correct):High-risk jurisdictionsare associated withcorruption and financial crime, making transactions involving their citizenshigher risk.
* Option D (Correct):Selling assetsbelow market valueis a common tactic todisguise illicit funds or transfer value illicitly.
* Option B (Incorrect):While cross-border legal representation may raise questions,it is not inherently suspicious.
* Option C (Incorrect):Offshore companies are common intax planning, though they requirefurther scrutiny.
Reference:FATF Report on Money Laundering through Real Estate (2022), EU AMLD Directives, Wolfsberg Principles on High-Risk Transactions.
NEW QUESTION # 302
A large cash deposit most likely reflects money laundering when it is
1. from a customer who has never conducted a transaction in cash before.
2. transacted in segments smaller than the reporting thresholds at various times during the day.
3. followed by an immediate wire transfer to an offshore secrecy haven.
4. by a customer who operates a cash-based business.
- A. 1, 2, and 3 only
- B. 2, 3, and 4 only
- C. 1, 3, and 4 only
- D. l, 2, and 4 only
Answer: A
Explanation:
A large cash deposit is a red flag for money laundering when it is inconsistent with the customer's profile, behavior, or business activity. A customer who has never conducted a transaction in cash before may be trying to avoid detection or conceal the source of the funds. A customer who transacts in segments smaller than the reporting thresholds at various times during the day may be engaging in structuring or smurfing, which are techniques to evade currency transaction reporting requirements. A customer who follows a large cash deposit with an immediate wire transfer to an offshore secrecy haven may be attempting to layer or move the funds to a jurisdiction with weak anti-money laundering controls or high confidentiality. These scenarios indicate a high risk of money laundering and warrant further investigation and reporting.
A customer who operates a cash-based business may have a legitimate reason to make a large cash deposit, depending on the nature and scale of the business. However, this does not mean that the customer is exempt from scrutiny or monitoring, as cash-based businesses are also vulnerable to money laundering abuse. The bank should verify the source and purpose of the funds, and compare the deposit with the customer's expected activity and turnover.
Reference:
CAMS Certification Package - 6th Edition, Chapter 4: Conducting and Supporting the Investigation Process, pp. 97-98.
Warning signs of money laundering | The Law Society, Section: Cash deposits and withdrawals.
NEW QUESTION # 303
When an existing customer becomes a politically exposed person (PEP), what should the KYC analyst do during the review/refresh period?
- A. Perform enhanced due diligence for the customer and update the KYC profile.
- B. Update the new authorized signatories in the customer profile.
- C. Seek the compliance officer's advice before marking the authorized signatory as PEP.
- D. Update the list of signatories and perform enhanced due diligence in the next periodic refresh cycle.
Answer: A
Explanation:
When an existing customer becomes a politically exposed person (PEP), the KYC analyst should perform enhanced due diligence (EDD) for that customer. EDD involves gathering additional information about the customer, assessing the risk associated with their PEP status, and updating the KYC profile accordingly. The goal is to ensure compliance with regulations, verify customer identities, and mitigate the higher risk posed by PEPs. Regular monitoring and updates during the review/refresh period are essential to stay informed about any changes in the customer's status or risk profile1.
References:
PEP in KYC & KYB: Requirements and Steps for PEP Screening
Politically Exposed Persons (PEP): Definition and Risks | Okta
How to effectively screen PEPs to meet KYC requirements - Castellum.AI
NEW QUESTION # 304
Combating the Financing of Terrorism (CFT)]
Which of the followingscenarios best justifies why a customer's account might be closedby a financial institution?
- A. The customer is the object of acivil subpoena.
- B. The account shows periodic fixed amount remittances fortuition fees.
- C. The customer uses ashipping company dealing with specially designated nationals (SDNs).
- D. The account has transactions that triggered multiplesuspicious activity reports (SARs).
Answer: D
Explanation:
Accounts may beclosedif theypose high money laundering or sanction risks.
* Option A (Correct):MultipleSAR filingsindicatehigh risk, possibly requiringaccount closureif AML concerns persist.
* Option B (Incorrect):Tuition paymentsare alegitimate purposefor fund transfers.
* Option C (Incorrect):Indirect dealings withSDNs require compliance review, but notimmediate account closure.
* Option D (Incorrect):Civil subpoenasalone do not justifyaccount termination.
Reference:FATF Recommendation 10 (Customer Due Diligence), Wolfsberg Group Customer Exit Best Practices, FinCEN Guidance on SAR Reporting.
NEW QUESTION # 305
Which activity is most likely to facilitate money laundering through on-line banking systems with inadequate controls?
- A. Conducting a large volume of transactions
- B. Providing continuous worldwide access
- C. Conducting anonymous transactions
- D. Conducting large value transactions
Answer: C
Explanation:
Conducting anonymous transactions is the most likely activity to facilitate money laundering through online banking systems with inadequate controls. Anonymous transactions allow money launderers to hide their identity, source and destination of funds, and the purpose of their transactions from the authorities and the financial institutions. Online banking systems that do not have proper KYC, customer due diligence, and transaction monitoring controls are vulnerable to being exploited by money launderers who can use various techniques, such as encryption, proxy servers, virtual currencies, prepaid cards, and online gambling, to conduct anonymous transactions123.
ACAMS CAMS Certification Study Guide, 6th Edition, Chapter 2, page 40-41, 43-44 ACAMS CAMS Certification Video Training Course, Module 2, Lesson 2.4, Money Laundering Using New Payment Methods
1, Fighting money laundering in the age of online banking, virtual currencies and internet gambling | ERA Forum
2, Financial crime risk management in digital payments | McKinsey
3, The Relationship Between Digital Banking and Financial Crime
NEW QUESTION # 306
Which unusual or suspicious activity by a financial institution's (FI's) employee requires additional investigation and scrutiny?
- A. The employee is involved in a minimal number of unresolved exceptions.
- B. The employee avoids taking periodic vacations despite having accrued vacation time.
- C. The employee assists with transactions of a disclosed ultimate beneficiary.
- D. The employee lives a lavish lifestyle within their means.
Answer: B
Explanation:
an employee who avoids taking periodic vacations despite having accrued vacation time may be trying to conceal fraudulent or illegal activities that would be exposed in their absence. This is a common red flag for internal fraud and money laundering, as it indicates a lack of segregation of duties, internal controls, and oversight. Employees who engage in such behavior may also exhibit other signs of stress, defensiveness, or secrecy.
References:
Learn about red flags for internal fraud, section "An employee may be a higher internal fraud risk when a combination of the following red flags are present", bullet point 1: "Unwilling to share duties or take leave." Money Laundering Red Flags | Key Behaviours and Indicators, section "Employee Red Flags", bullet point 1: "Avoiding taking holidays or time off work." Top 10 AML Red Flags: Warning Signs and Financial Risks, section "AML Red Flags Categories", sub-section "Employee Red Flags", bullet point 1: "Avoiding taking vacations or sick leaves."
NEW QUESTION # 307
the Financing of Terrorism (CFT)]
Which statement best describes a key aspect of the AML Directive of the EU regarding business relationships and transactions with high-risk third countries?
- A. Obliged entities, in accordance with the member state regulations, should determine at a national level the measures that can be used for enhanced due diligence.
- B. Obliged entities should not take into account specific circumstances when performing enhanced due diligence measures.
- C. Obliged entities should implement additional mitigating measures complementary to the enhanced customer due diligence procedures, in accordance with a risk based approach.
- D. Obliged entities should voluntarily consider the implementation of increased external audit requirements for branches and subsidiaries located in high-risk countries.
Answer: C
Explanation:
According to the AML Directive of the EU, obliged entities, such as banks and other financial institutions, are required to apply enhanced vigilance in business relationships and transactions involving high-risk third countries, which are those identified by the Commission as having strategic deficiencies in their anti-money laundering and countering the financing of terrorism regimes1. The types of enhanced vigilance requirements are basically extra checks and control measures which are defined in article 18a of the Directive1. However, these requirements are not exhaustive, and obliged entities should also implement additional mitigating measures that are complementary to the enhanced customer due diligence procedures, in accordance with a risk based approach1. This means that obliged entities should assess the level of risk posed by each customer, product, service, transaction, or delivery channel, and apply appropriate measures to mitigate those risks2. The additional mitigating measures may include, for example, obtaining additional information on the customer and the beneficial owner, applying additional elements of enhanced monitoring, increasing the frequency and intensity of transaction testing, or requiring the first payment to be carried out through an account in the customer's name with a bank subject to similar customer due diligence standards1.
:
1: Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, and amending Directives 2009/138/EC and 2013/36/EU (Text with EEA relevance)
2: Guidance on Risk Factors, EBA, 2021
Reference: https://www.nortonrosefulbright.com/en/knowledge/publications/8f84c163/the-eus-fifth-anti- money-laundering-directive-a-regulatory-compliance-perspective
NEW QUESTION # 308
A well-developed anti-money laundering compliance program is unlikely to achieve institutional goals without
- A. Training appropriate employees.
- B. Screening all staff.
- C. Verification of account owners.
- D. Endorsement by a competent authority.
Answer: A
Explanation:
According to the ACAMS CAMS Certification Study Guide, 6th Edition, one of the four pillars of an effective anti-money laundering compliance program is the training of appropriate employees on their responsibilities and the institution's policies and procedures. Training is essential to ensure that employees are aware of the risks of money laundering and terrorist financing, the applicable laws and regulations, the red flags and indicators of suspicious activity, and the reporting and record-keeping requirements. Without proper training, employees may not be able to perform their duties effectively and efficiently, and may expose the institution to legal, regulatory, reputational, and operational risks.
References:
ACAMS CAMS Certification Study Guide, 6th Edition, Chapter 2, Section 2.1.4, page 39.
ACAMS CAMS Certification Video Training Course, Module 2, Lesson 2.1.4.
NEW QUESTION # 309
A compliance officer at a small community bank has been asked to review existing customer onboarding policies and procedures to ensure they adequately address anti-money laundering risks.
How should customer due diligence be implemented?
- A. As an ongoing activity that may vary commensurate with the risk profile of the customer
- B. With a one-time event conducted at initial customer onboarding
- C. With an annual compliance review and approval of customers
- D. As applicable to customers that pose higher money laundering or terrorist financing risk
Answer: A
Explanation:
Customer due diligence should be implemented as an ongoing activity that may vary commensurate with the risk profile of the customer. This is because the risk of money laundering or terrorist financing may change over time, depending on the customer's behavior, transactions, products, services, and geographic locations. The institution should monitor the customer's activity and update the customer's information and risk assessment periodically, or when there are red flags or significant changes in the customer's circumstances. The institution should also apply enhanced due diligence measures for customers that pose higher risks, and simplified due diligence measures for customers that pose lower risks12.
Reference:
1: CAMS Certification Package - 6th Edition | ACAMS, Chapter 1: Risks and Methods of Money Laundering and Terrorist Financing, p. 18-19 2: FATF Guidance: Customer Due Diligence and Financial Inclusion, February 2018, p. 10-11, http://www.fatf-gafi.org/media/fatf/documents/reports/Guidance-CDD-and-Financial-Inclusion-2018.pdf
NEW QUESTION # 310
When performing an investigation, which key steps should be taken to maintain and secure supporting documentation used to perform an investigation of a suspicious activity?
- A. Perform the alerting transaction with alternative thresholds to ensure they are calibrated correctly.
- B. Ensure that a secure archive has information available to the client.
- C. Maintain a record of the transaction activity that generated the alert
- D. Disseminate the rationale for the investigative approach and the objective basis for the determination.
Answer: C
Explanation:
According to the ACAMS CAMS Certification Study Guide (6th edition), one of the key steps of conducting an investigation of a suspicious activity is to maintain and secure supporting documentation used to perform the investigation. This includes the transaction activity that generated the alert, the analysis performed, the decision made, and the rationale for the decision. This documentation serves as evidence of the investigation process and the compliance with the relevant policies and procedures. It also helps to ensure consistency, accountability, and transparency in the investigation process1 References: 1: ACAMS CAMS Certification Study Guide (6th edition), page 156.
NEW QUESTION # 311
Which three entities does the Third European Union Money Laundering Directive apply to?
- A. Defense Attorneys
- B. Financial Institutions
- C. Casinos
- D. Real Estate Agents
Answer: B,C,D
Explanation:
The Third European Union Money Laundering Directive (3MLD) is a legal framework that aims to prevent the use of the financial system for the purposes of money laundering and terrorist financing. It was adopted in
2005 and repealed by the Fourth European Union Money Laundering Directive (4MLD) in 2015. The 3MLD applies to a range of entities that are considered to be exposed to the risk of money laundering and terrorist financing, such as:
* Financial institutions, which include credit institutions, financial intermediaries, insurance companies, investment firms, and payment service providers.
* Casinos, which include both online and offline gambling services that involve wagering a stake with monetary value.
* Real estate agents, which include both natural and legal persons that act as intermediaries in the buying and selling of real property or rights over it.
The 3MLD requires these entities to implement a number of measures to prevent and detect money laundering and terrorist financing, such as:
* Conducting customer due diligence, which involves identifying and verifying the customer and the beneficial owner, understanding the purpose and nature of the business relationship, and applying enhanced or simplified measures depending on the level of risk.
* Keeping records of customer and transaction data for at least five years after the end of the business relationship or the execution of the transaction.
* Reporting suspicious transactions or activities to the competent authorities without delay and without tipping off the customer.
* Establishing internal policies, procedures, and controls to ensure compliance with the 3MLD, and providing adequate training and awareness to staff.
* Cooperating with the relevant supervisory and regulatory authorities and financial intelligence units.
The 3MLD does not apply to defense attorneys, as they are not considered to be obliged entities under the directive. However, the 3MLD does apply to other legal professionals, such as notaries, lawyers, and accountants, when they perform certain activities on behalf of their clients, such as:
* Buying and selling of real property or business entities
* Managing of client money, securities, or other assets
* Opening or managing bank, savings, or securities accounts
* Organizing contributions for the creation, operation, or management of companies
* Creating, operating, or managing trusts, companies, foundations, or similar structures References:
* THE THIRD EU DIRECTIVE ON MONEY LAUNDERING AND TERRORIST FINANCING, page
11-12
* Anti-money laundering and countering the financing of terrorism legislative package, page 1
* CAMS Study Guide - 6th Edition, Chapter 1, Section 1.2, page 11
V
NEW QUESTION # 312
What is the primary action a financial institution should take before formulating its anti-money laundering program?
- A. It should perform a comprehensive risk analysis
- B. It should ensure that its training modules for all employees cover all relevant AML issues
- C. It should determine how extensive and well-trained the compliance staff is
- D. It should consult with its correspondent banks to determine the nature and extent of their AML programs
Answer: A
Explanation:
A comprehensive risk analysis is the first and most important step in developing an effective anti-money laundering program. A risk analysis helps a financial institution identify and assess its exposure to money laundering and terrorist financing risks, based on its products, services, customers, geographic locations, and other factors. A risk analysis also enables a financial institution to tailor its policies, procedures, controls, and training to mitigate the specific risks it faces. A risk analysis should be conducted periodically and updated as necessary to reflect changes in the institution's risk profile.
:
ACAMS Study Guide for the CAMS Certification Examination, 6th Edition, Chapter 2: Compliance Standards for Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT), Section 2.1:
Risk-Based Approach, p. 29-30
ACAMS Risk Assessment, What is Anti-Money Laundering (AML) Risk Assessment?
How to Conduct an AML Risk Assessment - Assess Key Risk Drivers
NEW QUESTION # 313
What are two risks to institutions for violating anti-money laundering laws as demonstrated by the 2012 HSBC settlement with United States authorities? (Choose two.)
- A. Loss of bank charter/license
- B. Forfeiture of assets
- C. Imprisonment of bank employees
- D. Civil money penalties
Answer: B,D
Explanation:
Institutions that violate anti-money laundering laws may face various risks and consequences, such as legal, regulatory, reputational, and operational risks. As demonstrated by the 2012 HSBC settlement with United States authorities, two of the most significant risks are:
* Forfeiture of assets. This means that the institution may have to surrender some or all of its assets that are related to the money laundering activities or violations. For example, HSBC agreed to forfeit $1.256 billion as part of its deferred prosecution agreement with the US Department of Justice1.
* Civil money penalties. This means that the institution may have to pay fines or penalties to the government or other regulatory agencies for violating the anti-money laundering laws or regulations. For example, HSBC agreed to pay $665 million in civil money penalties to various US regulators, including the Office of Foreign Assets Control, the Federal Reserve Board, and the Office of the Comptroller of the Currency1.
The other two options, C and D, are not as common or relevant to the 2012 HSBC settlement. Loss of bank charter/license may occur in extreme cases where the institution is deemed unfit to operate or poses a serious threat to the financial system. Imprisonment of bank employees may occur if the employees are found guilty of criminal charges, such as fraud, conspiracy, or wilful violation of anti-money laundering laws. However, these outcomes are usually reserved for individuals, not institutions, and depend on the specific facts and circumstances of each case.
1: HSBC announces settlements with authorities, 2012, https://www.hsbc.com/-/files/hsbc/investors/stock- exchange-announcements/2012/december/2012-12-11-hsbc-announces-settlements-with-authorities.pdf
2: Settlement Agreement between the U.S. Department of the Treasury's Office of Foreign Assets Control and HSBC Holdings plc, 2012, https://ofac.treasury.gov/recent-actions/20121211_33
3: HSBC settles on record US fee, 2012, https://www.dw.com/en/hsbc-settles-in-us-money-laundering-probe
/a-16443391
4: HSBC pays record $1.9bn fine to settle US money-laundering accusations, 2012, https://www.theguardian.
com/business/2012/dec/11/hsbc-bank-us-money-laundering
5: HSBC to pay $1.9bn in US money laundering penalties, 2012, https://www.bbc.com/news/business-
20673466
NEW QUESTION # 314
......
The CAMS certification is issued by the Association of Certified Anti-Money Laundering Specialists (ACAMS), a leading international organization in the AML field. ACAMS provides training, certification, and networking opportunities to AML professionals worldwide. The CAMS certification is valid for three years, and candidates are required to earn 60 continuing education credits (CECs) during this period to maintain their certification status.
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