CAMS Practice Exam PREP
CAMS PRACTICE EXAM PREP LATEST 2025/2026 ACTUAL EXAM
COMPLETE 200 QUESTIONS AND CORRECT ANSWERS GRADED
A+ GUARANTEED PASS- ACE YOUR EXAM
A customer has held an account at a local credit institution for 1 years. The
account has received deposits twice for the same amount and has never shown
signs of suspect behavior. Monitoring saftware indicated that in the past few
months the account has received several large deposits that were not in line with
the account history. When asked, the customer states she recently sold a piece of
property, which is supported with a proof of sale. What should the compliance
officer do next?
A. Investigate these unusual transactions further B. Contact the local FIU for
advice C. File an STR with the competent authorities D. Document reasons for not
filing a STR - Correct Answer-C
What is one recommendation of the Basel Committee's 2001 paper Customer Due
Dilligence for Banks?
A. Numbered accounts should not be allowed B. Certain types of private banking
can be exempt from KYC procedures C. Banks should develop clear descriptions of
acceptable customers D. Politically Exposed Persons (PEPs) should not be accepted
as customers - Correct Answer-C
A remittance company received a money order from a senior political figure in the
Philippines to transfer a large sum of money to a charity group in the Philippines.
A review of the charity group revealed a director having close ties with a known
terrorist group primarily financed through kidnapping and extortion. What is a key
risk indicator associated with terrorism financing?
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, CAMS Practice Exam PREP
A. The sender is a PEP and should be subject to enhanced due diligence B. A large
sum sent by money order to a charity C. There is no risk relating to terrorism
financing when the charity group in operating legitimately in that country D. There
is a link between the charity group and a known terrorist group - Correct Answer-
D
In performing a risk analysis, which factor(s) should a financial institution review?
A. The level of its gross revenue B. Recent regulatory actions against financial
institutions of comparable size C. Its customer base, location, products and
services D. The adequacy and completeness of its STR filings - Correct Answer-C
What should law enforcement provide when asking an institution to keep an
account open?
A. An explanation of the underlying conduct that is being investigated B. A written
request with an explanation of the scope of the investigation C. An in-person visit
by an investigating official to explain why the account must remain open D. A
written request on government agency letterhead with the appropriate signature -
Correct Answer-D
Which example describes the vulnerability of the securities sector for money
laundering?
A. A non-US person seeks to open a brokerage account with a US broker-dealer B.
A broker-dealer must have a customer identification program in place C. Broker-
dealers generally have a higher percentage of inexperienced staff D.
Compensation for broker-dealers is generally based on commissions - Correct
Answer-D
2|Page
, CAMS Practice Exam PREP
Ina ddition to monitoring for suspicious activity, what are electronic monitoring
systems also valuable for?
A.Identifying how customers are using products B. Highlighting the skills of the
system analysts C. Proving to the Board of Directors that the FIU is doing its job D.
Meeting mandatory regulatory requirements for system implementation - Correct
Answer-D
In which three situations is correspondent banking most vulnerable to money
laundering? Choose 3
A. When allowing foreign banks to use the correspondent account to conduct
large financial transations on behalf of their customers B. When allowing the
correspondent bank account to be used as a payable through account (PTA) C.
When allowing the correspondent bank account to be used by other banks D.
When allowing financial institutions, without prior due dilligence, to access
correspondent network for routing their financial transactions - Correct Answer-A,
B, C
How does a regulatory body typically obtain international assistance in a money
laundering inquiry?
A. By filing a request under Egmont guidelines B. By submitting a request for
overseas assistance to the corresponding supervisory body C. By contacting the
FATF, Organization for Economic Co-operation and Development, or other
international organizations ans seeking their intervention D. By communicating
with the head of complinace for the financial institution - Correct Answer-B
Federal law requires all US financial institutions to secure and maintain all records
and supporting documentation used in suspicious activity reporting for how many
years?
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, CAMS Practice Exam PREP
A. 2 B. 5 C. 10 D. No requirement - Correct Answer-B
What is a major money laundering risk associated with a number of prepaid cards
as opposed to credit or debit cards?
A. The risk of losing the prepaid cards B. The inability to load the card with cash C.
The global access to cash through ATMs D. The anonymous access to funds -
Correct Answer-D
An audit completed the previous week revealed that a private banking customer
submitted incomplete documents when establishing an account earlier in the
year. The cutomer received weekly electronic fund transfers froma narcotic-
producing jurisdiction. While the relationship manager who opened the account is
on leave for 5 weeks, the customer requests that the institution remit a
substantial sum to a country that represents a high risk for money laundering. The
relationship manager is a friend of the anti-money laundering specialist. What the
anti-money laundering officer do first?
A. File a suspicious transaction reprt with the competent authority B. Investigate
the transfer of funds C. Suspend the transfer until the relationship manager
returns D. Postpone the follow-up on the audit finding - Correct Answer-A
Why would a credit card account likely not be used in the placement phase of
money laundering?
A. Customer Identification is required B. Cash payments are generally restricted C.
Credit refunds have a waiting period D. Credit cards can access ATMs globally -
Correct Answer-B
What are some red flags financial institutions should be aware of when trying to
verify the identity of a customer? Choose 3
4|Page
CAMS PRACTICE EXAM PREP LATEST 2025/2026 ACTUAL EXAM
COMPLETE 200 QUESTIONS AND CORRECT ANSWERS GRADED
A+ GUARANTEED PASS- ACE YOUR EXAM
A customer has held an account at a local credit institution for 1 years. The
account has received deposits twice for the same amount and has never shown
signs of suspect behavior. Monitoring saftware indicated that in the past few
months the account has received several large deposits that were not in line with
the account history. When asked, the customer states she recently sold a piece of
property, which is supported with a proof of sale. What should the compliance
officer do next?
A. Investigate these unusual transactions further B. Contact the local FIU for
advice C. File an STR with the competent authorities D. Document reasons for not
filing a STR - Correct Answer-C
What is one recommendation of the Basel Committee's 2001 paper Customer Due
Dilligence for Banks?
A. Numbered accounts should not be allowed B. Certain types of private banking
can be exempt from KYC procedures C. Banks should develop clear descriptions of
acceptable customers D. Politically Exposed Persons (PEPs) should not be accepted
as customers - Correct Answer-C
A remittance company received a money order from a senior political figure in the
Philippines to transfer a large sum of money to a charity group in the Philippines.
A review of the charity group revealed a director having close ties with a known
terrorist group primarily financed through kidnapping and extortion. What is a key
risk indicator associated with terrorism financing?
1|Page
, CAMS Practice Exam PREP
A. The sender is a PEP and should be subject to enhanced due diligence B. A large
sum sent by money order to a charity C. There is no risk relating to terrorism
financing when the charity group in operating legitimately in that country D. There
is a link between the charity group and a known terrorist group - Correct Answer-
D
In performing a risk analysis, which factor(s) should a financial institution review?
A. The level of its gross revenue B. Recent regulatory actions against financial
institutions of comparable size C. Its customer base, location, products and
services D. The adequacy and completeness of its STR filings - Correct Answer-C
What should law enforcement provide when asking an institution to keep an
account open?
A. An explanation of the underlying conduct that is being investigated B. A written
request with an explanation of the scope of the investigation C. An in-person visit
by an investigating official to explain why the account must remain open D. A
written request on government agency letterhead with the appropriate signature -
Correct Answer-D
Which example describes the vulnerability of the securities sector for money
laundering?
A. A non-US person seeks to open a brokerage account with a US broker-dealer B.
A broker-dealer must have a customer identification program in place C. Broker-
dealers generally have a higher percentage of inexperienced staff D.
Compensation for broker-dealers is generally based on commissions - Correct
Answer-D
2|Page
, CAMS Practice Exam PREP
Ina ddition to monitoring for suspicious activity, what are electronic monitoring
systems also valuable for?
A.Identifying how customers are using products B. Highlighting the skills of the
system analysts C. Proving to the Board of Directors that the FIU is doing its job D.
Meeting mandatory regulatory requirements for system implementation - Correct
Answer-D
In which three situations is correspondent banking most vulnerable to money
laundering? Choose 3
A. When allowing foreign banks to use the correspondent account to conduct
large financial transations on behalf of their customers B. When allowing the
correspondent bank account to be used as a payable through account (PTA) C.
When allowing the correspondent bank account to be used by other banks D.
When allowing financial institutions, without prior due dilligence, to access
correspondent network for routing their financial transactions - Correct Answer-A,
B, C
How does a regulatory body typically obtain international assistance in a money
laundering inquiry?
A. By filing a request under Egmont guidelines B. By submitting a request for
overseas assistance to the corresponding supervisory body C. By contacting the
FATF, Organization for Economic Co-operation and Development, or other
international organizations ans seeking their intervention D. By communicating
with the head of complinace for the financial institution - Correct Answer-B
Federal law requires all US financial institutions to secure and maintain all records
and supporting documentation used in suspicious activity reporting for how many
years?
3|Page
, CAMS Practice Exam PREP
A. 2 B. 5 C. 10 D. No requirement - Correct Answer-B
What is a major money laundering risk associated with a number of prepaid cards
as opposed to credit or debit cards?
A. The risk of losing the prepaid cards B. The inability to load the card with cash C.
The global access to cash through ATMs D. The anonymous access to funds -
Correct Answer-D
An audit completed the previous week revealed that a private banking customer
submitted incomplete documents when establishing an account earlier in the
year. The cutomer received weekly electronic fund transfers froma narcotic-
producing jurisdiction. While the relationship manager who opened the account is
on leave for 5 weeks, the customer requests that the institution remit a
substantial sum to a country that represents a high risk for money laundering. The
relationship manager is a friend of the anti-money laundering specialist. What the
anti-money laundering officer do first?
A. File a suspicious transaction reprt with the competent authority B. Investigate
the transfer of funds C. Suspend the transfer until the relationship manager
returns D. Postpone the follow-up on the audit finding - Correct Answer-A
Why would a credit card account likely not be used in the placement phase of
money laundering?
A. Customer Identification is required B. Cash payments are generally restricted C.
Credit refunds have a waiting period D. Credit cards can access ATMs globally -
Correct Answer-B
What are some red flags financial institutions should be aware of when trying to
verify the identity of a customer? Choose 3
4|Page
