ACAMS FINAL EXAM VERSION 1 2026/2027
WITH ACTUAL CORRECT QUESTIONS AND
VERIFIED DETAILED ANSWERS
|CURRENTLY TESTING QUESTIONS AND
SOLUTIONS|ALREADY GRADED A+|NEWEST
|BRAND NEW VERSION|JUST RELEASED!!
Describe an intermediary financial institution.
An intermediary financial institution receives funds from a
wire transfer transmitter's financial institution and relays or
transmits the order of payment to the recipient's financial
institution. In an international funds transmission,
intermediary financial institutions are usually
located in different countries.
Describe a lockbox.
A service offered by banks to companies in which the
company receives payments by mail to a post office box and
the bank picks up the payments several times a day, deposits
them into the company's account, and notifies the company
of the deposits. The service enables the company to put the
money to work as soon as it is received, but the amounts
must be large in order for the value obtained to exceed the
cost of the service. In the insurance industry there is also
widespread use of "lock boxes" for payment
of life insurance and annuities products.
What is an International Business Company (IBC)?
1|Page
,A variety of offshore corporate structures, alternately called
"exempt companies," which are dedicated to business use
outside the incorporating jurisdiction, rapid formation,
secrecy, broad powers, low cost, low to zero taxation, and
minimal filing and reporting requirements.
What is a Mutual Legal Assistance Treaty (MLAT)?
An agreement among countries allowing for mutual
assistance in legal proceedings and access to documents and
witnesses and other legal and judicial resources in the
respective countries, in private and public sectors, for use in
official investigations and prosecutions.
Describe Know Your Customer (KYC).
Know Your Customer (KYC) refers to anti‐money laundering
policies and procedures used to determine the true identity
of a customer and the type of activity that is "normal and
expected," and to detect activity that is "unusual" for a
particular customer. Many experts believe that a sound KYC
program is one of the best tools in an effective anti‐money
laundering program.
What is a nominee company?
A corporation that is formed for the express purpose of
holding securities and other assets in its name on behalf
of others, or providing nominee directors and/or officers on
behalf of clients.
Describe a nostro account.
2|Page
,Nostro and vostro accounts are mirror correspondent
accounts maintained by two banks in different jurisdictions to
facilitate transactions in each other's local
currency—essentially, clearing accounts that balance foreign
currency transactions between the two institutions. For
example, Bank X from Brazil might open a U.S.‐dollar account
at Bank Y in the U.S., called a "nostro"
(literally "our") account; Bank Y might open a mirror account
in Brazilian reals with Bank X in Brazil—a "vostro" ("your")
account. Financial regulators have expressed concern over
the transparency of nostro and vostro account relationships,
especially when there are multiple layers of accounts within
primary relationships.
What are remittance services?
Remittance services are also referred to as giro houses or
casas de cambio. Remittance services are businesses that
receive cash or other funds that they transfer through the
banking system to another account. The account is held by
an associated company in a foreign jurisdiction where the
money is made available to the ultimate recipient.
Define physical cross‐border transportation of currency.
The physical cross‐border transportation of currency is
defined as any in‐bound or out‐bound transportation of
currency or bearer negotiable instruments from one country
to another. The term includes: (1) physical transportation by
a natural person, or in that person's accompanying luggage or
vehicle; (2) shipment of
3|Page
, currency through cargo containers; and (3) the mailing
of currency or bearer negotiable instruments.
Describe a Ponzi Scheme.
A money laundering system named after Charles Ponzi, an Italian
immigrant who spent 10 years in jail in the U.S. for a scheme that
defrauded 40,000 people out of $15,000,000. Ponzi's name became
synonymous with the use of new investors' money to pay off prior
investors. Ponzi schemes involve fake, non‐existent investment
schemes in which the investors are tricked into investing on the
promise of unusually attractive returns. The operator of the scheme
can keep the operation going by paying off early investors with the
money from new investors until the scheme collapses under its own
weight and/or the promoter vanishes with the remaining money.
The scheme recently engaged in by Bernie Madoff is an example of
a Ponzi scheme. The prime bank guaranty, roll program, bank
debenture program and high yield promises are frequently used to
entice investors into participating in Ponzi schemes.
Define a red flag.
A warning signal that should bring attention to a potentially
suspicious situation, transaction or activity.
What is a safe harbor for reporting suspicious activity?
Safe harbor is defined as legal protection for financial
institutions, their directors, officers and employees from
criminal and civil liability for breach of any restriction on
disclosing information imposed by contract or by any
legislative, regulatory or administrative prohibition, if they
report their suspicions in good faith to the Financial
4|Page
WITH ACTUAL CORRECT QUESTIONS AND
VERIFIED DETAILED ANSWERS
|CURRENTLY TESTING QUESTIONS AND
SOLUTIONS|ALREADY GRADED A+|NEWEST
|BRAND NEW VERSION|JUST RELEASED!!
Describe an intermediary financial institution.
An intermediary financial institution receives funds from a
wire transfer transmitter's financial institution and relays or
transmits the order of payment to the recipient's financial
institution. In an international funds transmission,
intermediary financial institutions are usually
located in different countries.
Describe a lockbox.
A service offered by banks to companies in which the
company receives payments by mail to a post office box and
the bank picks up the payments several times a day, deposits
them into the company's account, and notifies the company
of the deposits. The service enables the company to put the
money to work as soon as it is received, but the amounts
must be large in order for the value obtained to exceed the
cost of the service. In the insurance industry there is also
widespread use of "lock boxes" for payment
of life insurance and annuities products.
What is an International Business Company (IBC)?
1|Page
,A variety of offshore corporate structures, alternately called
"exempt companies," which are dedicated to business use
outside the incorporating jurisdiction, rapid formation,
secrecy, broad powers, low cost, low to zero taxation, and
minimal filing and reporting requirements.
What is a Mutual Legal Assistance Treaty (MLAT)?
An agreement among countries allowing for mutual
assistance in legal proceedings and access to documents and
witnesses and other legal and judicial resources in the
respective countries, in private and public sectors, for use in
official investigations and prosecutions.
Describe Know Your Customer (KYC).
Know Your Customer (KYC) refers to anti‐money laundering
policies and procedures used to determine the true identity
of a customer and the type of activity that is "normal and
expected," and to detect activity that is "unusual" for a
particular customer. Many experts believe that a sound KYC
program is one of the best tools in an effective anti‐money
laundering program.
What is a nominee company?
A corporation that is formed for the express purpose of
holding securities and other assets in its name on behalf
of others, or providing nominee directors and/or officers on
behalf of clients.
Describe a nostro account.
2|Page
,Nostro and vostro accounts are mirror correspondent
accounts maintained by two banks in different jurisdictions to
facilitate transactions in each other's local
currency—essentially, clearing accounts that balance foreign
currency transactions between the two institutions. For
example, Bank X from Brazil might open a U.S.‐dollar account
at Bank Y in the U.S., called a "nostro"
(literally "our") account; Bank Y might open a mirror account
in Brazilian reals with Bank X in Brazil—a "vostro" ("your")
account. Financial regulators have expressed concern over
the transparency of nostro and vostro account relationships,
especially when there are multiple layers of accounts within
primary relationships.
What are remittance services?
Remittance services are also referred to as giro houses or
casas de cambio. Remittance services are businesses that
receive cash or other funds that they transfer through the
banking system to another account. The account is held by
an associated company in a foreign jurisdiction where the
money is made available to the ultimate recipient.
Define physical cross‐border transportation of currency.
The physical cross‐border transportation of currency is
defined as any in‐bound or out‐bound transportation of
currency or bearer negotiable instruments from one country
to another. The term includes: (1) physical transportation by
a natural person, or in that person's accompanying luggage or
vehicle; (2) shipment of
3|Page
, currency through cargo containers; and (3) the mailing
of currency or bearer negotiable instruments.
Describe a Ponzi Scheme.
A money laundering system named after Charles Ponzi, an Italian
immigrant who spent 10 years in jail in the U.S. for a scheme that
defrauded 40,000 people out of $15,000,000. Ponzi's name became
synonymous with the use of new investors' money to pay off prior
investors. Ponzi schemes involve fake, non‐existent investment
schemes in which the investors are tricked into investing on the
promise of unusually attractive returns. The operator of the scheme
can keep the operation going by paying off early investors with the
money from new investors until the scheme collapses under its own
weight and/or the promoter vanishes with the remaining money.
The scheme recently engaged in by Bernie Madoff is an example of
a Ponzi scheme. The prime bank guaranty, roll program, bank
debenture program and high yield promises are frequently used to
entice investors into participating in Ponzi schemes.
Define a red flag.
A warning signal that should bring attention to a potentially
suspicious situation, transaction or activity.
What is a safe harbor for reporting suspicious activity?
Safe harbor is defined as legal protection for financial
institutions, their directors, officers and employees from
criminal and civil liability for breach of any restriction on
disclosing information imposed by contract or by any
legislative, regulatory or administrative prohibition, if they
report their suspicions in good faith to the Financial
4|Page
