CAMS sample questions

Question 1

A bank account is established for a new business customer. The business was established five years ago with an address in another state. The business website contains few details other than stating it is a real estate business.

One principal has an international telephone number and appears to be living in another country.
The other principal works out of a recreational vehicle.

What warrants enhanced due diligence in this scenario?

Accepted Answer

Shell company

Answer

Human trafficker

Answer

Politically exposed person

Answer

Money laundering through real estate

Question 2

A branch manager for a small community bank has a new customer who deposits four EUR 50,000 checks into one account. Shortly thereafter, the customer goes to another branch and asks to transfer all but EUR 1,500 to three accounts in different foreign jurisdictions.

Which suspicious activity should be the focus of the suspicious transaction report?

Accepted Answer

The customer goes to a different branch to make this transaction

Answer

The customer opened the account with four large checks

Answer

The customer transfers almost all of the funds out of the account

Answer

The customer asks to transfer funds to accounts in three different foreign jurisdictions

Question 3

A government has instituted new anti-money laundering laws which require all financial institutions to obtain certain information from its customers.

Which step should an institution located in this jurisdiction take to ensure compliance?

Accepted Answer

Send a notice to customers asking them to provide the necessary information

Answer

Change procedures to require that the necessary information is obtained

Answer

Change procedures and systems as necessary and provide employee training

Answer

Change systems to ensure the required information is automatically obtained from all customers

Question 4

An anti-money laundering audit identifies a significant weakness in how transaction monitoring alerts are cleared. Audit sampling identified potentially suspicious activity that was cleared as not suspicious. Management accepts the audit finding and develops a remediation plan.

What is the role of the auditor during the correction phase?

Accepted Answer

Developing procedures to provide sufficient risk-based documentation for clearing alerts

Answer

Directing the remediation of the deficiency in a timely manner

Answer

Providing training to the alert clearing department on the importance of effective alert clearing

Answer

Validating the successful remediation of the issue once management indicates the issue is resolved

Question 5

Which method to launder money through deposit-taking institutions is closely associated with international trade?

Accepted Answer

Using Black Market Peso Exchange

Answer

Forming a shell company

Answer

Structuring cash deposits/withdrawals

Answer

Investing in legitimate businesses with illicit funds

Question 6

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 7

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 8

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 9

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 10

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

Free CAMS sample questions

A government has instituted new anti-money laundering laws which require all financial institutions to obtain certain information from its customers. Which step should an institution located in this jurisdiction take to ensure compliance?

Which method to launder money through deposit-taking institutions is closely associated with international trade?

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?

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?

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

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