Free Access ACAMS CAMS New Release

When investigating unusual transactions, financial institutions must focus on data-driven risk assessment and internal review first.

Option A (Correct):Assessing business ownership and control structureshelps determine ifmultiple businesses are connected through hidden links(e.g., shell companies or common ownership).

Option C (Correct):The account managermay provide valuable insight on whether the customer’s activity aligns with their expected profile.

Option B (Incorrect):Law enforcement should only be contacted after internal review confirms suspicious activity.

Option D (Incorrect):Declining transactions without thorough investigationcould lead tomissed SAR filingsor improper risk assessment.

Option E (Incorrect):Social media is not a reliable investigative toolfor AML casework.

Key Red Flags in Business AML Investigations:

Frequent transactions between businesses with no clear commercial relationship.

Ownership structures that obscure beneficial owners.

Rapid movement of funds through multiple accounts without economic justification.

Best Practices for Investigating Complex Cases:

Verify ownership and control through official company registries.

Conduct negative news screening and PEP/sanctions screening.

Request supporting documentation from the customer.

ASuspicious Activity Report (SAR)is required when afinancial institution detects activity that raises suspicion of money laundering, terrorist financing, or fraud.

Option A (Correct):Inability to verify customer identification documentsis ared flag for potential financial crimeand may requirereporting to the Financial Intelligence Unit (FIU).

Option B (Incorrect):PEPs require enhanced due diligence (EDD), but their involvement alone does not automatically trigger a SAR.

Option C (Incorrect):Dealers in precious metals/stones are high-risk, but being in this industry alonedoes not warrant an automatic SAR.

Option D (Incorrect):Crypto-to-fiat transactions are not inherently suspicious, but they requiremonitoring for unusual activity.

Key SAR Filing Triggers:

Transactions that do not match the customer’s expected activity.

Incomplete, fraudulent, or unverifiable customer identification.

Use of shell companies or unusual intermediaries.

Large or structured transactions with no apparent legitimate purpose.

Best Practices for SAR Compliance:

Implement robust customer due diligence (CDD) processes.

Monitor transaction behavior against expected patterns.

Follow jurisdictional SAR filing deadlines to avoid penalties.

Banks mustcomply with legal subpoenaswhile ensuring AML compliance.

Option B (Correct):The bank shouldreview client transactionsandrespond fullyto law enforcement.

Option A (Incorrect):Filing a SAR simply because of a subpoenaisnot requiredunless suspicious activity is identified.

Option C (Incorrect):Tipping offthe client about the subpoena isillegalunder AML laws.

Option D (Incorrect):Risk scores should be reviewedbut not automatically adjustedsolely based on a subpoena.

Thereal estate sectoris a known avenue formoney laundering, and this scenario presents multiplered flags.

Option A (Correct):High-risk jurisdictionsare associated withcorruption and financial crime, making transactions involving their citizenshigher risk.

Option D (Correct):Selling assetsbelow market valueis a common tactic todisguise illicit funds or transfer value illicitly.

Option B (Incorrect):While cross-border legal representation may raise questions,it is not inherently suspicious.

Option C (Incorrect):Offshore companies are common intax planning, though they requirefurther scrutiny.