CAMS exam questions for practice in 2021 Updated 542 Questions
Updated Nov-2021 Premium CAMS Exam Engine pdf - Download Free Updated 542 Questions
CAMS Exam topics
Candidates must know the exam topics before they start of preparation. Because it will really help them in hitting the core. Our CAMS dumps will include the following topics:
- SAR and STR filing
- AML/CFT compliance program designs in several business settings
- Maintenance of an effective AML/CFT compliance program
- The assistance of institutional investigations
- Important elements of an Anti-Money Laundering (AML) program
- How to manage and support a money laundering investigation
- Conducting or supporting the investigation process
- Money laundering risks and strategies, like Black Market Peso Exchange and import and export price manipulation
- Recognition of AML compliance risks
- The Financial Action Task Force (FATF) Recommendations, the Basel Committee’s Report on client Due Diligence and also the Wolfsberg cluster Principles
- Money laundering and terrorist financing methods
- Comply standards for anti-money laundering (AML) and combating the financing of terrorism (CFT)
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NEW QUESTION 204
A financial institution's monitoring system triggers an alert and an internal investigation has confirmed the activity as suspicious. Which of the following should an anti-money laundering specialist do before submitting the suspicious transaction report?
- A. Add information related to the suspicious activity to the customer's account-opening file.
- B. Check with other financial institutions in accordance with the relevant law.
- C. Contact the customer for further information without disclosing the suspicion.
- D. Secure documents related to the suspicious circumstances and the decision to report.
Answer: C
NEW QUESTION 205
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.)
- A. 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.
- B. 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.
- C. 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.
- D. Financial institutions need to assist competent authorities in fighting terrorist financing through prevention, detection and information sharing.
Answer: A,D
NEW QUESTION 206
How can a 'free-look provision' as part of a life insurance policy help criminals to launder money?
- A. A policy owner has freedom to decide who the beneficiary of the policy will be and can in this way move money to an unrelated third party.
- B. A policy owner can decide how to pay the premium within a pre-defined period.
- C. A policy owner is able to terminate the contract without penalties such as surrender charges.
- D. A policy owner has freedom to decide who the beneficiary of the policy will be and can in this way move money to a related third party.
Answer: B
NEW QUESTION 207
Which action should an FIU consider taking when it has information that might be useful to another FIU?
- A. Request approval from the Egmont Group prior to sharing the information with the other FIU
- B. Take no action until contacted by the other FIU
- C. Supply the information to the other FIU spontaneously as soon as the relevance of sharing the information is identified
- D. In accordance with Wolfsberg guidelines, submit the information to the other FIU in written form
Answer: C
NEW QUESTION 208
The compliance officer for a bank is reviewing on-boarding documents for a new business account for a domestic corporation. The officer is unable to verify the identity of the beneficial owners of the company.
Only
information on the nominee owners was provided, and none of the listed addresses are local. The purpose of the business and future expected activity were disclosed to include cash letters, money orders and international remittance transfers.
Which red flag identifies a heightened money laundering risk?
- A. The nature and purpose of the business include international remittance transfers
- B. The names provided at account opening are identified as the corporation's representative nominees
- C. Account signer's government issued identification lists addresses outside of where the branch account was opened
- D. Expected activity was advised to include cash letter and money orders
Answer: A
NEW QUESTION 209
What are the regulatory risks to a bank employee who willfully violates anti-money laundering laws?
- A. Enforcement actions including fines against the financial institution
- B. Investigation and reputational damage
- C. Fines and suspension from the industry
- D. Criminal investigation and imprisonment
Answer: D
NEW QUESTION 210
A customer comes into a financial institution and deposits a large amount of cash. He has never done that before. When asked about the deposit, he indicates he recently sold a used car and received cash.
He does not trust forms of payment and is wary of counterfeit money orders. What should the bank do?
- A. The institution should close the account before another issues arise
- B. The bank has received a plausible explanation, so it should do nothing
- C. While the explanation may be plausible, the institute should nonetheless file a Suspicious Transaction Report to protect itself
- D. While the explanation appears plausible, the institution should, for a period of time, monitor the account for cash transactions and suspicious activity
Answer: D
Explanation:
Explanation/Reference:
NEW QUESTION 211
In 2004, Consolidated KYC Risk Management was issued by the Basel Committee on Banking Supervision (BCBS). What is a key message in this document?
- A. KYC Risk Management means as established decentralized process for promulgating policies and procedures
- B. KYC Risk Management required a yearly consolidation effort
- C. Policies and procedures should be designed not merely to comply strictly with all relevant laws and regulations
- D. Consolidated KYC risk management for a group is critical and trumps jurisdictional rules hat limit information sharing
Answer: C
NEW QUESTION 212
A local law enforcement officer notifies the bank compliance officer that he is working on an insurance fraud scheme that appears to be running transactions using the account of a bank employee. The law enforcement officer refers to a kiting suspicious transaction report filed by the compliance officer and requests further information.
What action should the compliance officer take?
- A. Call the employee and demand an explanation
- B. Inform the board of directors
- C. Allow access to the bank's documents immediately
- D. Provide the information to the law enforcement in response to a formal written request
Answer: D
NEW QUESTION 213
A company service provider in Country A sets up a corporate structure for a client from Country B, which is known for corruption. The corporate structure includes a holding company in Country A with a bank account in one of the international banks located there.
During on-boarding, the client's wealth was estimated at $7 million. Shortly thereafter, the client's father became president of Country
B. During a routine client review two years later, it was identified that client's wealth had grown to $510 million.
What are two red flags that indicate money laundering or financial terrorism? (Choose two.)
- A. The holding company is in Country A with a bank account in one of the international banks.
- B. The client is from a country known for corruption.
- C. The client is a family member of a PEP from a country known for corruption.
- D. The substantial growth in wealth during a short period of time.
Answer: C,D
NEW QUESTION 214
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?
- A. Ensure non-profit organizations cannot be used to conceal or obscure the diversion of funds intended for legitimate purposes to terrorists' organizations
- B. Allow for freezing assets of non-profit organizations
- C. Create laws that forbid non-profit organizations from completing cross-border transactions without first running them through known terrorist data bases
- D. Require all non-profit organizations to register with the country's financial intelligence unit
Answer: A
NEW QUESTION 215
Which three are principles found in the document "Principles of information Exchange between Financial Intelligence Units (FIUs)"?
- A. The Egmont principle of free exchange of information at the FIU level should be possible on thebasis of reciprocity, including spontaneous exchange
- B. The exchange of information between FIUs should take place as informally and as rapidly aspossible and with no prerequisites, while guaranteeing protection of privacy and confidentialityof the shared data
- C. Differences in the definition of offenses that fall under the competence of FIUs should be beforefree exchange of information takes place
- D. It should be possible for communication between FIUs to take place directly and withoutintermediaries
Answer: A,B,D
NEW QUESTION 216
When creating an anti-money laundering program for a foreign bank with branches in the U.S., which three are included among the four minimum elements required under the USA Bank Secrecy Act? Choose 3 answers
- A. The designation of a compliance officer
- B. The development of a Know You Customer program
- C. An independent audit functions to test the program
- D. An ongoing employee training program
Answer: A,C,D
NEW QUESTION 217
A comprehensive set of risk-based guidelines for maintaining business relationships is being developed.
Which situation indicates that the institution should terminate the relationship with a client?
- A. The client conducts international financial transactions exceeding U.S. $500 million.
- B. The client exceeds the criteria of an acceptable risk model created by another institution that is not similar in size and complexity.
- C. The client exceeds the criteria of an acceptable risk model created by the institution and does not perform acceptable remedial actions.
- D. The client does business in countries with active terrorist organizations.
Answer: C
NEW QUESTION 218
In many jurisdictions, financial institutions are prohibited from hiring a person who has been convicted of what type of offense?
- A. Protests of government action
- B. Driving while under the influence
- C. Kidnapping
- D. Offenses involving dishonesty
Answer: D
Explanation:
Explanation/Reference: http://www.capitol.hawaii.gov/hrscurrent/vol07_ch0346-0398/HRS0378/HRS_0378-0003.htm (See
9th point)
NEW QUESTION 219
Upon a routine account review a money laundering investigator identified a number of large round dollar wire transfer deposits into a business account owned by a local auto repair shop. The wire transfers all originated from a country that is a known financial secrecy haven with poor anti-money laundering controls. The investigator concludes there appears to be no legitimate business purpose for the wire transfers and files a suspicious transaction report. The owner of the auto repair shop is popular in the community and is a well-known philanthropist.
To whom should the investigator escalate these concerns?
- A. The owner of the auto repair shop
- B. Chairman of the Board
- C. The bank anti-money laundering officer
- D. Audit committee
Answer: C
NEW QUESTION 220
A bank located in Arizona is considering a loan application for a new client. The collateral for the loan is a property in Florida.
The loan will be in the name of a limited company (LLC) whose ownership is not disclosed to the bank. The LLC was established by a New York-based attorney.
The loan will be repaid by the LLC in monthly wire transfers of $9,000 which is more than the required monthly payment.
Which aspect indicates the potential for money laundering?
- A. The repayment in the amount of $9,000 indicates potential structuring
- B. The attorney associated with the account is outside the bank's lending area
- C. The LLC's ownership is not disclosed to the bank
- D. The collateral, a property in Florida, is not located in Arizona
Answer: A,C
NEW QUESTION 221
Outgoing foreign transactions of similar amounts trigger a monitoring alert for a customer's accounts. During the evaluation of the accounts, the bank discovers the wire transfers were very small amounts and occurred within the last 3 months following a long period of inactivity. The wire transfers appear to originate from legal sources. To assess the potential of terrorist financing, the institution must ensure the
- A. account holder does not reside in a country included on the U.S. State Department State Sponsors of Terrorism List.
- B. beneficiaries of transfers are not included on the Transparency International List.
- C. account holder presents proof the funds are legal.
- D. beneficiaries of transfers are not on a terrorist watch list.
Answer: A
NEW QUESTION 222
Which two statements are true regarding the European Union Money Laundering Directives? (Choose two.)
- A. They have extraterritorial impact and apply to states that have diplomatic relations with member states
- B. They apply to member states of the European Union
- C. They require member states to enact laws and/or regulations to comply with the directives
- D. They set forth non-binding best practices for financial institutions within the member states
Answer: B,C
NEW QUESTION 223
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