All CAMS Test Inside ACAMS Questions

According to the CAMS Certification Package - 6th Edition1, one of the essential components of customer due diligence is verifying the identity of the customer using reliable and independent sources. This verification process should be done before or during the establishment of the business relationship, and should not be delayed unless there is a low risk of money laundering or terrorist financing, and the delay is necessary to avoid interrupting the normal course of business. Therefore, after customers have provided acceptable identification, the financial institution should next confirm the validity of the customer information, as option A suggests. Option B is not necessary, as an electronic picture of each customer is not a mandatory requirement for customer verification, and may not be feasible or effective in some cases. Option C is not the next step, as closely monitoring the account for 30 days is part of the ongoing due diligence process, which should be performed after the customer verification is completed and the account is established. Option D is not advisable, as establishing the account based on the information provided without verifying its validity may expose the financial institution to money laundering and terrorist financing risks, and may violate the KYC and AML regulations.

1: CAMS Certification Package - 6th Edition | ACAMS, Chapter 3: Compliance Standards for Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT), pages 69-70.

 One of the common methods used by money launderers to hide the origin and destination of illicit funds is to create complex corporate structures that obscure the identity of the real owners or controllers of the assets. Lawyers can facilitate this process by providing legal services such as setting up shell companies, trusts, foundations, or other entities in jurisdictions with weak AML regulations or high secrecy. By doing so, lawyers can help their clients evade taxes, avoid sanctions, conceal criminal activities, or launder money. This is why lawyers are considered high-risk professionals for AML purposes and are subject to due diligence and reporting obligations.

= Some of the references that support this answer are:

ACAMS Study Guide for the CAMS Certification Examination, Chapter 3, Section 3.2.2, page 77: “Lawyers are often used to create complex corporate structures that can be used to hide the beneficial ownership of assets.”

Money Laundering Reporting Officer: The Role Of MLRO, Section “Money Laundering Risks For Lawyers”: “Lawyers are at risk of being used by criminals to launder money through various means, such as creating corporate entities, conducting transactions, or providing advice.”

New York Lawyer Pleads Guilty to Ponzi Scheme, Money Laundering, Section “Lawyer agrees to forfeit $19 million from investment scheme”: “A New York lawyer admitted Monday to money laundering and orchestrating an $18.8 million Ponzi scheme using his Forest Hills-based law firms, Wisnicki & Associates LLP and Wisnicki Neuhauser LLP.”

According to the USA PATRIOT Act, US authorities do have the power to subpoena records from foreign banks that maintain correspondent accounts with US banks. This is known as a "section 314(a) request," which allows law enforcement to obtain information related to suspected terrorist financing or money laundering.

However, US authorities are not limited to seizing only funds transferred under OFAC sanctions if there is an equivalent UN sanctions regime that has been contravened. The US government can impose its own sanctions that are independent of the UN, and can seize funds or take other actions to enforce those sanctions.

Therefore, the correct answers to the question are A and C:

A. If the funds are seized, then the foreign bank would be within its rights to dispute such seizure. C. The USA PATRIOT Act authorizes the Secretary of the Treasury or the Attorney General to subpoena records from the foreign bank that maintains a correspondent account with a US bank.

free of payment asset transfer is a trading pattern that may be indicative of money laundering in capital markets. Free of payment asset transfer is a method of transferring securities without any corresponding payment, which can be used to avoid detection of the origin or destination of the funds. This can facilitate the layering or integration stages of money laundering, as the launderer can move the assets across different accounts, jurisdictions, or institutions without leaving a clear audit trail. Free of payment asset transfer can also be used to evade taxes, sanctions, or other regulatory requirements.

ACAMS Study Guide 6th Edition, Chapter 1, Section 1.8, page 28: “Methods to launder money using broker-dealers, investment advisors, and the capital markets (e.g., securities, futures)”.

ExamTopics, Question 476: “Which trading pattern may be indicative of money laundering in capital markets?”