Acams cams practice test

Question 1

The main purpose of the US Treasury Department for OFAC's extraterritorial reach is to:

• A. accomplish the foreign policy and national security goals of the US.
• B. defend the US against questionable trade practices of its economic rivals.
• C. protect allied nations of the US from the economic threats of non-allied nations.
• D. align OFAC's and other countries' extraterritorial reach requirements.

Answer:

A

Explanation:
Reference:
https://www.natlawreview.com/article/aggressive-extraterritorial-reach-us-economic-
sanctions-foreign-company-exposure-to
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Question 2

The bank's Compliance Officer is tasked with designing standards based on Basel's KYC principles.
Which essential elements should be included in the program? (Choose two.)

• A. Appointing an independent audit function
• B. Conducting a money laundering risk assessment
• C. Documenting a customer acceptance policy
• D. Establishing on-going monitoring of high-risk accounts
• E. Reporting suspicious activity

Answer:

C, E

Explanation:
Reference:
https://www.bis.org/publ/bcbs77.pdf
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Question 3

A SAR/STR should be filed when the accountable institution identifies that:

• A. a customer makes a cash deposit in round dollars.
• B. cash transactions have values which avoid reporting thresholds.
• C. an alert is generated by a transaction monitoring system.
• D. an employee is not clearing alerts in a timely manner.

Answer:

C

Explanation:
Reference:
https://www.fdic.gov/regulations/examinations/supervisory/insights/siwin07/article03_connecting.
html

Question 4

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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 finds evidence to substantiate the analyst's suspicion and submit a SAR/STR.
• B. Produce an investigation report that considers client activity and factors that may have legitimately affected transaction cost.
• C. Produce an updated due diligence record for the client so that monitoring can be enhanced.
• D. Produce a SAR/STR that describes apparent trade-based money laundering and submit to the Financial Investigation Unit (FIU).

Answer:

B

Question 5

Which key factor would result in the decision for a financial institution (FI) to exit a client
relationship?

• A. After assessing all risk factors the level of residual client risk exceeds the FI's risk appetite.
• B. The client is a registered charity known to remit funds to high risk geographies where there is limited due diligence information available.
• C. Closing the client accounts will help reduce the number of transaction monitoring alerts.
• D. Client transactions generate ongoing transaction monitoring alerts that did not result in any SAR/STR filings.

Answer:

A

Question 6

Financial institutions (FIs) perform AML risk assessments to ensure:

• A. a record for regulators indicating an AML risk assessment was completed at least once.
• B. internal audit assurance that all AML-related policy and procedures are board approved.
• C. satisfaction of the board of directors' approved risk appetite.
• D. proper controls surrounding higher-risk products, services, customers, and geographic locations.

Answer:

D

Explanation:
Reference:
https://www.wolfsberg-
principles.com/sites/default/files/wb/pdfs/faqs/17.%20Wolfsberg-Risk-Assessment-FAQs-2015.pdf

Question 7

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What national agency is responsible for analyzing and assessing the information it receives to
substantiate possible existence of money laundering or terrorist financing activities?

• A. The Financial Intelligence Unit (FIU)
• B. FATF
• C. The Basel Committee
• D. The Wolfsberg Group

Answer:

B

Explanation:
Reference:
https://www.fatf-
gafi.org/media/fatf/content/images/National_ML_TF_Risk_Assessment.pdf

Question 8

When performing a risk assessment, which factors should be considered when identifying and
measuring risk? (Choose two.)

• A. Customer composition
• B. Financial performance
• C. Product offerings
• D. Regulatory environment
• E. Company culture

Answer:

A, D

Question 9

Which are common types of economic sanctions? (Choose three.)

• A. Targeted sanctions
• B. Technological sanctions
• C. SWIFT network sanctions
• D. Sectoral sanctions
• E. Supervisory sanctions
• F. Comprehensive sanction

Answer:

A, C, F

Explanation:
Reference:
https://www.cfr.org/backgrounder/what-are-economic-sanctions

Question 10

Which private banking situation requires due diligence actions to be implemented according to the
AML principles of the Wolfsberg group?

• A. A local wealthy individual wants to become a customer of a local retail bank.
• B. A beneficial owner of an exchange house wants to open an account with the bank.
• C. A wealthy individual from a high-risk country wants to open an account with a private bank.
• D. A new customer asks to set up an exchange house using the bank as the correspondent.

Answer:

C