CAMS sample questions

Question 1

A customer opens a corporate account with a broker-dealer on behalf of several beneficial owners, with a stated long-term investment goal. The customer deposits $25.5 million into the account and three days later transfers $5 million to an overseas bank. Shortly thereafter, the customer begins

making numerous purchases of pesos. The compliance officer receives a query regarding the movement of funds. Within a month of account opening, the customer depletes the account.

Which two red flags should prompt the firm’s compliance officer to take action? (Choose two.)

Accepted Answer

The compliance officer receives the query regarding the movement of funds

Accepted Answer

The customer’s stated investment goal is not reflective of account activity

Answer

The new account deposit is $25.5 million

Answer

A corporate account is opened on behalf of several beneficial owners

Question 2

What should countries do to help prevent non-profit organizations from being abused for the financing of terrorism according to the Financial Action Task Force 40 Recommendations?

Accepted Answer

Ensure non-profit organizations cannot be used to conceal or obscure the diversion of funds intended for legitimate purposes to terrorists’ organizations

Answer

Allow for freezing assets of non-profit organizations

Answer

Require all non-profit organizations to register with the country’s financial intelligence unit

Answer

Create laws that forbid non-profit organizations from completing cross-border transactions without first running them through known terrorist data bases

Question 3

An employee hears a colleague on the telephone with a customer giving advice on how to ensure that a suspicious transaction report will not be filed as a result of a future transaction.

What action should the employee take?

Accepted Answer

Report the conversation to the compliance officer

Answer

Report the conversation to the local police

Answer

Tell the colleague that it is against policy to give such advice

Answer

Ignore the situation because the colleague is the relationship manager for that customer

Question 4

The USA PATRIOT Act requires United States (U.S.) financial institutions to collect certain information from non-U.S. banks that hold a correspondent account.

Which two pieces of information must a non-U.S. bank provide to its U.S. correspondent to enable them to comply with this requirement? (Choose two.)

Accepted Answer

The name and address of all beneficial owners who own 25% or more of the bank

Accepted Answer

Prompt notice of any suspicious activity it detects on any customer who uses the correspondent account

Answer

The name and address of all shell banks the bank maintains accounts for

Answer

The name and address of a U.S. person who is authorized to receive service of legal process for the bank

Question 5

What are two legal risks of having inadequate privacy policies and procedures? (Choose two.)

Accepted Answer

Diminished reputation

Accepted Answer

Industry of regulatory sanctions

Answer

Charges of deceptive business practices

Answer

Higher marketing and public relations costs

Question 6

The vice president of the foreign correspondent banking department at a large United States bank has been notified that a foreign bank with an offshore license wants to open a correspondent

Which two things must the vice president acquire under the USA PATRIOT Act? (Choose two.)

Accepted Answer

Information relating to the foreign bank’s anti-money laundering program

Accepted Answer

The identity of 10% owners of the correspondent bank, unless it is publicly traded

Answer

A list of all the customers of the correspondent bank

Answer

A list of all the customers of the correspondent bank

Question 7

What is an example of the integration stage of money laundering involving a bank or another deposit-taking institution?

Accepted Answer

Using illicit funds that had previously been deposited to purchase a luxury vehicle

Answer

Depositing illicit funds into an account set up for a front company

Answer

Directing third parties to exchange illicit cash for negotiable instruments

Answer

Wiring illicit funds from an account at one bank to an account at another bank

Question 8

Which aspect of the USA PATRIOT Act impacts foreign financial institutions?

Accepted Answer

Providing authority to impose special measures on institutions that are of primary money- laundering concern

Answer

Requiring enhanced due diligence for foreign shell banks

Answer

Expanding sanctions requirements to a U.S. financial institution’s foreign branches

Answer

Expanding the anti-money laundering program requirements to all foreign financial institutions

Question 9

The compliance officer at a crowdfunding website is in charge of monitoring new crowdfunding projects. Recently, the number of crowdfunding projects has significantly increased.

Which red flag indicates the highest anti-money laundering risk?

Accepted Answer

Projects that start and close and are fully funded within a very short period

Answer

Those with the largest number of donors

Answer

Projects that get funding within days of their start

Answer

Projects with the highest monetary success threshold

Question 10

Which two statements in the Wolfsberg Group’s “Suppression of the Financing of Terrorism” define the role financial institutions should play in the fight against terrorism? (Choose two.

Accepted Answer

Financial institutions need to assist competent authorities in fighting terrorist financing through prevention, detection and information sharing.

Accepted Answer

Financial institutions should apply extra due diligence whenever they see suspicious or irregular activities, especially when customers are engaged in sectors or activities that have been identified by competent authorities as being used for the financing of terrorism.

Answer

Financial institutions need to continuously analyze the types of activity related to terrorist financing and develop models that in the long term will drive down terrorism.

Answer

Financial institutions should have financial intelligence units dedicated to the investigation of activity that would lead to the detection of terrorist financing as a means to decrease global terrorism.

CAMS Sample Questions & Answers

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CAMS Sample Questions & Answers

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