John has reached out to the client asking for a Formal I.D in the periodic reassessment after an alert caused the KYC file to be refreshed. The client has email back a copy of their drivers licence, Is this acceptable?
- A . Yes
- B . No
- C . Depends
C
Explanation:
Depends on the Jurisdiction
Letters of Credit are a well known __________ Product?
- A . Finance
- B . Credit
- C . Trade Finance
- D . Fixed-Income
With regards to data and security, financial institutions must provide? (SELECT 2)
- A . Best Practice
- B . Duty of Care
- C . Optional Choice
- D . Legal Obligation
For a State Owned Enterprise to be officially a SOE, What are the levels of state involvement are requited
- A . Majority
- B . Full
- C . Half
- D . Significant
- E . Low
When are you allowed to refuse or terminate a relationship with a customer?
- A . Only at the beginning of the investigation.
- B . Only after the client has been onboarded, then the relationship can be terminated.
- C . only after the transaction monitoring has been done but not the KYC.
- D . At anytime during the onboarding process.
An Transaction Monitoring Analyst has found out that a company in which the alert has been generated from is using bearer shares for the formation of the company.
Is this client allowed in the United States?
- A . Yes
- B . No
- C . Depends on the jurisdiction of the entity
Joey a Transaction Monitoring analyst has discovered that after the risk assessment, There is no evidence of money laundering, terrorist financing, or economic sanctions.
What is the next stage for Joey here/
- A . Clear Alert
- B . Escalate to Compliance
- C . Escalate to his Senior Manager.
- D . Report to Law Enforcement
What Technologies are very active in Transaction Monitoring right now and in the future?
- A . Cloud Computing
- B . Machine Learning
- C . Artificial Intelligence
- D . Neural Networks
When do Financial Criminals mostly focus on tailoring their relationship with a bank?
- A . Before the formal relationship starts
- B . At the beginning of the banking relationship
- C . During the banking Relationship
- D . End of the Banking Relationship
What are some elements of a Shell Company? (SELECT 2)
- A . No assets or operations
- B . Sometimes legitimate but low-risk
- C . Sometimes facilitate money laundering
- D . Appear legitimate and mask ownership
While doing investigation on some adverse media checks that came up for an individual named Joey there were a few news stories connected to this individual.
Which are AML related and should be escalated? (SELECT 2)
- A . Joey has several derogatory credit problems and a score of 630
- B . Joey has been convicted of illegally distributing a banned drug
- C . Joey was arrested in Colombia for arriving at the airport with more than 10 thousand USD in cash.
- D . Joey had his house foreclosed on him two years ago.
During the name screening stage. Is this done and approved prior to onboarding, or during real time transactions?
- A . Prior to onboarding
- B . During realtime transactions
An organization when faced with the below must report which?
- A . If you have a bad feeling about the client but haven’t looked at the information, this is still ok.
- B . Every customer should be investigated for financial crime
- C . If they suspect a financial crime has been committed.
- D . If they suspect a financial crime has been committed, but only if they have the time and resources to do so.
Transaction monitoring controls are ____________ monitored, calibrated, and tuned, and new scenarios need to be introduced as the risks associated with the business change.
- A . Rarely
- B . Often
- C . Constantly
- D . Sometimes
The purpose of Transaction Monitoring in organizations is to ______________?
- A . Manage Client Risk
- B . Manage Financial Crime Risk
- C . Manage Compliance Risk
- D . Manage Transaction Risk
What takes priority over the analysis in an Investigation of an Alert?
- A . Human Analysis
- B . Automated Screening Tools
All charities and non-profits ngos require bank products just like companies, and as such they are required to be onboarded.
What are some of the main concerns/red flags that this type customer would bring to an AML Program? (SELECT 2)
- A . Launder illicit funds
- B . Poor regulations
- C . Fraudulent activity
- D . Breach Sanctions.
Can personal interviews of the client be used to mitigate an alert for Transaction Monitoring?
- A . TRUE
- B . FALSE
What amount of research is considered reasonably enough
- A . The type of content that is documented.
- B . If someone else of standing would find the conclusions justifiable
- C . The amount of content.
- D . the clarity of the amount?
A Transaction Monitoring report is usually referred as an __________
- A . Repository
- B . Analysis
- C . Report
- D . Alert
Dual Nationality can be a concern for many Transaction Monitoring analysts during the due diligence phase.
Which of the biggest concern for an analyst that would raise a potential red flag with a dual national?
- A . Marriage/Religion
- B . Location of Birth
- C . Parental Nationality
- D . Citizenship form participation in a local Investment Program
Johnny has brokered a deal to sell 100 missiles for $2 each. They will be shipped from Australia to Panama next week.
What is this an example of?
- A . Ghost-Shipping
- B . Over-Invoicing
- C . Under-Invoicing
- D . Good Business
Which of the items below is a well known Product for Trade Financing?
- A . Trade Over Invoice
- B . Articles of Incorporation
- C . Authorized Signatures
- D . Letters of Credit
Kate, who is an TM analyst is looking at an Domestic Import/Export company domiciled in Nebraska usually has revenue of around 100k per month. In the first 2 months of the new Financial year that average amount has changed to around 400k per month give or take.
If you were Kate what do you think factor change triggered the alert?
- A . Change of Jurisdiction
- B . Change of Behavior
- C . Tax Evasion
- D . Politically Exposed Persons
In terms of Virtual Currency, what does FIAT mean?
- A . Privately Owned Issued Money
- B . Blockchain Issued Money
- C . Average Italian Car
- D . Government Issued Money
Bill finds a registry for a company he is looking for. He later finds out that it is not government registry and that one must pay to use this registry.
Is this registry viable from an investigation standpoint?
- A . Yes
- B . No
- C . Depends
What is the process of making adjustments to the system to ensure that the alerts are indeed indicative of unusual behavior?
- A . Artificial Intelligence
- B . Machine Learning
- C . Tuning
- D . Data Analysis
In Transaction Monitoring what are alerts generated incorrectly by the system due to inefficiencies?
- A . False Negatives
- B . True Match
- C . False Match
- D . False Positives
What are some legal reasons that trusts can be used? (SELECT 3)
- A . Tax Avoidance
- B . Succession and Estate Planning,
- C . Tax Evasion
- D . Promote good causes
- E . Transfer of ownership at speed.
Joanne has just started her new job in Transaction Monitoring. After being trained she has just received her first alert.
What is the first thing she should do?
- A . Assess
- B . Explore
- C . Organize
- D . Report
With investigating and completing a file it is usually best practice to ensure proper checks are performed, a second person might review the file.
This is called? (SELECT 2)
- A . Quality Assurance
- B . Dual-Controls
- C . Two person check
- D . Four Eyes Check
In some jurisdictions, the media might be controlled by the same people you’ll be investigating?
- A . True
- B . False
Can social media can be used a reliable source on individual?
- A . Yes
- B . No
B
Explanation:
social media sites such as Facebook or LinkedIn can be useful to verify some information, blogs or comments placed on these sites may not prove to be a reliable source about an individual’s reputation
An internal escalation report can also be known as?
- A . No such thing
- B . Suspicious Activity Report
- C . Unusual Activity Report
- D . Internal Activity Report
How many W’s are in the SAR narrative?
- A . 3
- B . 4
- C . 5
- D . 4
C
Explanation:
who, what, when, where, and why.
What is an example of reputational risk below?
- A . Costs associated with having to increase the Anti-Money Laundering Surveillance at your company
- B . Terrorists were caught using the bank to fund an attack in the Middle East
- C . The organization operates in a country that is on a FATF non-compliance list.
- D . Paying back customers after the institution realized they overcharged them on fees.
What is the main purpose of having controls in your Transaction Monitoring program
It’s best practice to have controls in a Transaction Monitoring program
It’s a regulatory requirement?
- A . To manage financial crime risk
- B . Transaction Monitoring doesn’t require controls
Why is it important to know if a customer is a dual citizen (SELECT 2)
- A . It can help access jurisdiction activity as part of your research in the Transaction Monitoring process.
- B . The customer could have a second nationality of a notorious tax haven and is using their wealth and power gained from illicit funds to fund a tax evasion program.
- C . There could be Tax complications from being a dual citizen that compliance needs to know
- D . It’s a legal requirement.
You as the Transaction Monitoring Analyst have gone though Standard Due Diligence and Enhanced Due Diligence, but you feel that you have not provided enough evidence and proof to onboard the client safely. You feel that you still have concerns, what is the best approach here if you are the analyst.
- A . Approve the client, They have passed SDD and EDD, they are good to go.
- B . Ask a work colleague, perhaps a more senior person about the next step.
- C . Escalate your case to the next stage in the process for someone more qualified to look at it.
- D . Just leave the case their and do nothing, You’ve done everything you need to do it’s not your fault.
What is a legal reason to use a shell company
- A . Common legal structure
- B . Transfer Assets Easily
- C . Avoid Tax
- D . Fluid and not secure.
During the investigation period of a Transaction Monitoring alert, What are some examples of reliable information that can be used for the investigation?
- A . Older published date
- B . Industry Recognized
- C . Reputable
- D . Biased.
Why is Artificial Intelligence and Machine Learning becoming so big with Transaction Monitoring?
- A . They are inexpensive and cost effective
- B . They can be used interchangeably for different results.
- C . Can eliminate or reduce false positives, thus reducing large workloads automatically.
- D . AI and ML can help find more information related to financial crime and more effective transaction monitoring alerts.
The Beneficial Owner or Trustee of Trusts or special purpose vehicles is usually?
- A . Same person/Family
- B . Professional Services
- C . Complete Strangers
- D . Unrelated Parties
An insurance firm needs appropriate policies and procedures to prevent money laundering?
- A . Yes
- B . No
- C . Depends on the Jursidiction
What are some reasons to terminate the relationship with a customer? (SELECT 2)
- A . Activity looks suspicious
- B . New product has been added
- C . Change in Management
- D . Risk appetite has changed.
Which of the below can and need to be searched for Sanctions screening (SELECT 3)
- A . Boats
- B . Individuals
- C . Shipping Vessels
- D . Cars
- E . Planes
Designated non-financial businesses and professions are risk for Financial Crime because?
- A . They can collude with criminals to disguise financial crime
- B . Not all Designated non-financial businesses and professions are high risk
- C . These industries are accepting and exchanging cash on a often case?
- D . These industries and professions are generally unregulated
What is the method that changes the methodology and variables in the Transaction Monitoring Process?
- A . Turning
- B . Changing
- C . Tuning
- D . Settings
What of the below is not acceptable for research that can be documented for when investigating an alert?
- A . Corporates Registries
- B . Company Website
- C . LinkedIn
- D . Reputable Media outlets
What reason here is one of the reasons why Private Banking is high risk?
- A . Lacks government oversight
- B . Private banking can be low risk, it depends on a wide range of variables.
- C . The products are complex
- D . Can be used to hide the beneficial owner
When one bank acts for other bank in another by providing banking services in another jurisdiction, this is known as?
- A . Private Banking
- B . Trade Finance
- C . Correspondent Banking
- D . Virtual Currency
The percentage and types of alerts that become cases will vary based on institution type, client base, jurisdiction, etc? (TRUE OR FALSE)
- A . True
- B . False
A
Explanation:
There is no standard alert-to-suspicious activity ratio is discussed in the book
What are the main differences with Virtual Currency compared with a Central Bank backed Currency? (SELECT 2)
- A . Virtual Currency uses peer-to-peer technology to facilitate payments
- B . Virtual Currency can be used for financial crime, whilst Central Bank backed currency cannot.
- C . Virtual Currency is not backed by a Central Government.
- D . Virtual Currency is regulated, whilst banking is not.
The appropriate controls that should be put in place to mitigate and reduce them with the risk based approach include? (SELECT 3)
- A . Accurate
- B . Appropriate
- C . Risk based
- D . Assertive
- E . Specific
What is the big difference what transaction monitoring does and what name screening does?
- A . Name Screening is an ongoing process
- B . Transaction monitoring is used to predict customer transactions
- C . Transaction Monitoring is performed after onboarding
- D . Name screening is performed after onboarding.
The Four research steps in the Assess, Explore, Organize and ___________?
- A . Report
- B . Prepare
- C . Present
- D . Respond
In Transaction Monitoring what are some reasons below that shows that over time the number of True Alerts will improve for a Transaction Monitoring system? (SELECT 2)
- A . Transaction Monitoring software companies update their software
- B . Revising Rules
- C . Evaluating Alert Productivity
- D . Improved training for AML Analysts
Which of the below are non government organizational sources that can be used for internet search in online investigations.
- A . The Wolfsberg Group
- B . HSBC
- C . Financial Action Task Force
- D . Oppenheimer Group
- E . Egmont Group
Are informal value transfer systems a licensed Money Service Business or MSB?
- A . Yes
- B . No
- C . Depends on the Jurisdiction
Select 3 reasons below that are reasons for why Charities/Non-Profit/NGOS are vulnerable to Terrorist Financing? (SELECT 3)
- A . Heavily regulated
- B . Local presence
- C . Receiving considerable funds from unknown sources
- D . Exposed to areas that are terrorist friendly
- E . Cash-Intensive