ACAMS PRACTICE QUESTIONS AND ANSWERS
Which of the following is the most common method of laundering money through a legal
money services business?
A. Exchanging currency and remitting money
B. Smuggling bulk cash
C. Transferring funds through payable through accounts (PTAs)
D. Exchanging Colombian pesos on the black market - Answers - a
In general, the three phases of money laundering are said to be: placement and
A. structuring and manipulation.
B. layering and integration.
C. layering and smurfing.
D. integration and infiltration. - Answers - b
Which statement is true?
A. Systemic weaknesses in free trade zones include inadequate AML/CFT safeguards,
minimal
oversight by local authorities and weak procedures to inspect goods.
B. Cuckoo smurfing is a significant money laundering technique identified by the
Financial Action
Task Force, wherein a form of structuring uses nested accounts with shell banks in
secrecy havens.
C. In its 40 Recommendations, the FATF issued a list of designated categories of
offense that asserts
crimes for a money laundering prosecution.
D. E-cash is not attractive to the money launderer because it cannot be completely
anonymous and
does not allow for large amounts to be transported quickly and easily. - Answers - a
Which three of the following is an indication of possible money laundering in an
insurance industry scenario?
A. Insurance products sold through intermediaries, agents or brokers
B. Single-premium insurance bonds, redeemed at a discount
C. Policyholders who are unconcerned about penalties for early cancellation
D. Policyholders who redeem the policy within the free look period - Answers - b, c, d
Which two activities are typically associated with the black market peso exchange
(BMPE) money laundering system?
A. Converting illicit drug proceeds from dollars or euros to Colombian pesos
B. Converting illicit drug proceeds from Colombian pesos to dollars or euros
,C. Facilitating purchases by Colombian importers of goods manufactured in the United
States or
Europe through peso brokers
D. Facilitating purchases by European or U.S. importers of goods manufactured in
Colombia through
peso brokers - Answers - a & c
What is the right of reciprocity in the field of international cooperation against money
laundering?
A. The legal principle that financial institutions that have referred customers to other
financial institutions can share information about these customers with the other
institutions
B. A rule of the Basel Committee allowing properly regulated financial institutes of
another member state of the Basel Committee to do business without additional
supervision to the degree that the
other state grants the same right
C. The right of each FATF member country to delegate prosecution of a case of money
laundering to another member that is already investigating the same case
D. A rule in the law of a country allowing its authorities to cooperate with authorities of
other countries to the degree that their law allows them to do the same - Answers - d
The greatest risk for money laundering is for casinos that
A. provide their customers with a wide array of gambling services.
B. operate in a non-Egmont member country.
C. allow customers with credit balances to withdraw funds by check in another
jurisdiction.
D. only send suspicious transaction reports to the financial intelligence unit of the
country it operates in. - Answers - c
Which statement is true regarding the risk of politically exposed persons (PEPs)?
A. PEPs provide access to third parties on whom the financial institution has not
conducted sufficient due diligence.
B. PEPs have significantly greater exposure to the politically corrupt funds, including
accepting bribes or misappropriating government funds.
C. PEPs are foreign customers who inherently present additional risk as they are
engaged in crossborder transactions.
D. PEPs generally do not pose enhanced risks to an institution due to their political
standing; rather, PEPs increase the prestige of an institution. - Answers - b
In 2014, the Wolfsberg Group published its Anti-Money Laundering Principles for
Correspondent Banking. Which three of the following elements are recommended to be
included in the due diligence of
a correspondent banking client?
A. The geographic risk
B. The ownership and management structure
C. The résumé of the compliance officer
, D. The customer base - Answers - a, b & d
A new customer approaches a bank to open a commercial account. The customer
provides an address for the account located across the city from the branch. When
asked by the account representative if the customer requires any additional banking
services, the customer responds that she is also interested in opening a personal
investment account. The account representative refers the customer to the broker-
dealer. The customer tells the firm representative she has never had a brokerage
account before and has a few questions about how an investment account works. The
customer asks how deposits can be made into her account, if there are any reporting
requirements, and how to go about moving balances out of the account using wire
transfers. No questions are asked about fees associated with these transactions. Which
three items would be considered suspicious?
A. The customer asks many questions about the brokerage account but - Answers - a, c
&d
Trade-based money laundering requires the ability to
A. over- or under-invoice the goods.
B. sell the imported goods for as little as possible.
C. use goods that do not need to be declared.
D. avoid the use of high-value assets such as luxury cars or boats. - Answers - a
Which of the following statements is true? Correspondent banking is most vulnerable to
money laundering when the correspondent account is
A. maintained for foreign financial institutions that are banks.
B. not used to provide services directly to third parties.
C. maintained for a foreign bank that does not have a physical presence in any country.
D. maintained for a foreign private bank that is publicly traded and is a qualified
intermediary. - Answers - c
Which statement is true?
A. Lawyers in FATF member countries generally cannot be used to serve as formation
agents to set up trusts, front companies or shell companies.
B. Lawyers and similar professional gatekeepers are called money services businesses.
C. Lawyers generally cannot be used to act as nominee shareholders for a beneficial
owner.
D. Lawyers can be abused by launderers by using the accounts they set up for them for
the placement and layering of funds. - Answers - d
Which three of the following statements are true in respect to the Fourth EU Anti-Money
Laundering Directive?
A. Member countries can decide when and if they incorporate it into their local laws.
B. It repeals and replaces the Third EU Directive on Anti-Money Laundering.
C. Each member country must hold beneficial ownership information in a central registry
and it must be made available to competent authorities.
Which of the following is the most common method of laundering money through a legal
money services business?
A. Exchanging currency and remitting money
B. Smuggling bulk cash
C. Transferring funds through payable through accounts (PTAs)
D. Exchanging Colombian pesos on the black market - Answers - a
In general, the three phases of money laundering are said to be: placement and
A. structuring and manipulation.
B. layering and integration.
C. layering and smurfing.
D. integration and infiltration. - Answers - b
Which statement is true?
A. Systemic weaknesses in free trade zones include inadequate AML/CFT safeguards,
minimal
oversight by local authorities and weak procedures to inspect goods.
B. Cuckoo smurfing is a significant money laundering technique identified by the
Financial Action
Task Force, wherein a form of structuring uses nested accounts with shell banks in
secrecy havens.
C. In its 40 Recommendations, the FATF issued a list of designated categories of
offense that asserts
crimes for a money laundering prosecution.
D. E-cash is not attractive to the money launderer because it cannot be completely
anonymous and
does not allow for large amounts to be transported quickly and easily. - Answers - a
Which three of the following is an indication of possible money laundering in an
insurance industry scenario?
A. Insurance products sold through intermediaries, agents or brokers
B. Single-premium insurance bonds, redeemed at a discount
C. Policyholders who are unconcerned about penalties for early cancellation
D. Policyholders who redeem the policy within the free look period - Answers - b, c, d
Which two activities are typically associated with the black market peso exchange
(BMPE) money laundering system?
A. Converting illicit drug proceeds from dollars or euros to Colombian pesos
B. Converting illicit drug proceeds from Colombian pesos to dollars or euros
,C. Facilitating purchases by Colombian importers of goods manufactured in the United
States or
Europe through peso brokers
D. Facilitating purchases by European or U.S. importers of goods manufactured in
Colombia through
peso brokers - Answers - a & c
What is the right of reciprocity in the field of international cooperation against money
laundering?
A. The legal principle that financial institutions that have referred customers to other
financial institutions can share information about these customers with the other
institutions
B. A rule of the Basel Committee allowing properly regulated financial institutes of
another member state of the Basel Committee to do business without additional
supervision to the degree that the
other state grants the same right
C. The right of each FATF member country to delegate prosecution of a case of money
laundering to another member that is already investigating the same case
D. A rule in the law of a country allowing its authorities to cooperate with authorities of
other countries to the degree that their law allows them to do the same - Answers - d
The greatest risk for money laundering is for casinos that
A. provide their customers with a wide array of gambling services.
B. operate in a non-Egmont member country.
C. allow customers with credit balances to withdraw funds by check in another
jurisdiction.
D. only send suspicious transaction reports to the financial intelligence unit of the
country it operates in. - Answers - c
Which statement is true regarding the risk of politically exposed persons (PEPs)?
A. PEPs provide access to third parties on whom the financial institution has not
conducted sufficient due diligence.
B. PEPs have significantly greater exposure to the politically corrupt funds, including
accepting bribes or misappropriating government funds.
C. PEPs are foreign customers who inherently present additional risk as they are
engaged in crossborder transactions.
D. PEPs generally do not pose enhanced risks to an institution due to their political
standing; rather, PEPs increase the prestige of an institution. - Answers - b
In 2014, the Wolfsberg Group published its Anti-Money Laundering Principles for
Correspondent Banking. Which three of the following elements are recommended to be
included in the due diligence of
a correspondent banking client?
A. The geographic risk
B. The ownership and management structure
C. The résumé of the compliance officer
, D. The customer base - Answers - a, b & d
A new customer approaches a bank to open a commercial account. The customer
provides an address for the account located across the city from the branch. When
asked by the account representative if the customer requires any additional banking
services, the customer responds that she is also interested in opening a personal
investment account. The account representative refers the customer to the broker-
dealer. The customer tells the firm representative she has never had a brokerage
account before and has a few questions about how an investment account works. The
customer asks how deposits can be made into her account, if there are any reporting
requirements, and how to go about moving balances out of the account using wire
transfers. No questions are asked about fees associated with these transactions. Which
three items would be considered suspicious?
A. The customer asks many questions about the brokerage account but - Answers - a, c
&d
Trade-based money laundering requires the ability to
A. over- or under-invoice the goods.
B. sell the imported goods for as little as possible.
C. use goods that do not need to be declared.
D. avoid the use of high-value assets such as luxury cars or boats. - Answers - a
Which of the following statements is true? Correspondent banking is most vulnerable to
money laundering when the correspondent account is
A. maintained for foreign financial institutions that are banks.
B. not used to provide services directly to third parties.
C. maintained for a foreign bank that does not have a physical presence in any country.
D. maintained for a foreign private bank that is publicly traded and is a qualified
intermediary. - Answers - c
Which statement is true?
A. Lawyers in FATF member countries generally cannot be used to serve as formation
agents to set up trusts, front companies or shell companies.
B. Lawyers and similar professional gatekeepers are called money services businesses.
C. Lawyers generally cannot be used to act as nominee shareholders for a beneficial
owner.
D. Lawyers can be abused by launderers by using the accounts they set up for them for
the placement and layering of funds. - Answers - d
Which three of the following statements are true in respect to the Fourth EU Anti-Money
Laundering Directive?
A. Member countries can decide when and if they incorporate it into their local laws.
B. It repeals and replaces the Third EU Directive on Anti-Money Laundering.
C. Each member country must hold beneficial ownership information in a central registry
and it must be made available to competent authorities.
