AML Certification CAMS ACAMS Study Notes

FIs mustcooperate with law enforcement requestswhile ensuringlegal compliance.

Option C (Correct):Adesignated compliance officershould handledocument preparation and internal review.

Option A (Incorrect):There isno requirementto wait for theCEO’s approval.

Option B (Incorrect):Privacy policies should already align withAML laws, delaying compliance isnot recommended.

Option D (Incorrect):Blocking a lawful requestcould lead tolegal and regulatory action.

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.

Financial institutions are required by law to maintain records and documentation of customer transactions and to provide this information to law enforcement agencies upon request. However, financial institutions should also have policies and procedures in place to ensure that they comply with legal and regulatory requirements and protect customer privacy. Providing protected documents that are privileged under attorney-client privilege or freezing an account immediately may not be the appropriate response and may expose the financial institution to legal or reputational risks.

The Wolfsberg Group is an association of 13 global banks that aims to develop frameworks and guidance for the management of financial crime risks. The group started as a meeting of banks in 1999 to address anti-money laundering (AML) in private banking, which carries an increased degree of risk from a money laundering perspective. In the course of discussions, they articulated principles that reflected uniformly high standards for this client segment. These principles became the first guidance published by the group under the name Wolfsberg Principles.

The Wolfsberg Group - Institute on Governance

Wolfsberg Group - Wikipedia

The Group first came together in 2000 at the Wolfsberg castle in Switzerland, accompanied by representatives of Transparency International, to draft anti-money laundering guidelines for private banking