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 CAMS STUDY PLAN
The Backbone of success is hard work, determination, good planning & perseverance.

You were born to win, but to be a winner,

you must plan to win, prepare to win, and
expect to win. If you don't see yourself
A GOAL WITHOUT as a winner, then you cannot perform as
A PLAN IS A WISH a winner.
STUDY WEEK 6
Plan your work and
work your plan STUDY WEEK 5
BY FAILING TO STUDY WEEK 4
PREPARE, YOU
ARE PREPARING STUDY WEEK 3

TO FAIL.
STUDY WEEK 2

STUDY WEEK 1
 CHAPTER 1

RISKS & METHODS OF MONEY

LAUNDERING & TERRORIST & FINANCING

10 MCQs
1. What are the key effects of money laundering on countries? Choose three.

A. Reputation Risk.
B. Losing control on regulatory policy.
C. Being forced into adverse fiscal policies.
D. Losing control of monetary policy.

2. Which of the following are most vulnerable to the placement stage of money laundering? Choose
two.

A. Purchasing diamonds.
B. Overpaying a credit card balance.
C. Obtaining cashier cheques.
D. Internet casinos.
3. Why are credit unions (Building societies) vulnerable to money laundering?

A. They are small in size.

B. They have high level of cash transactions.
C. They offer complex products.
D. They are not regulated.

4. At which stages of money laundering are credit cards used? Choose two.

a. Layering
b. Structuring
c. Integration
d. Placement
5. What is wash trading?

A. The ability to launder funds using nominee accounts.

B. The inherent anonymity granted by many broker-dealers.
C. The use of offsetting trades to launder funds.
D. The trading of commodities.

6. Casinos & other gaming venues are attractive to money launderers for the following reasons.
Choose three.

A. They offer a plausible source of recently acquired wealth.

B. Gambles can be placed so that there is very little risk to capital.
C. They variety of gambling opportunities are useful at the integration stage.
D. Funds can be made available to different jurisdiction.
7. Why are travel agents vulnerable to money launderers? Choose one.

A. They sell hotel rooms in high risk destinations.

B. Hotels are frequented by politically exposed persons.
C. Refunds can be made to third parties.
D. They are listed in the FATF 40 Recommendations.

8. Lawyers are more useful in money laundering than company formation agents because of the
following reason:

A. They have a client attorney privilege.

B. They can represent the launderers at the court.
C. They can create complex vehicles such as private investment companies.
D. They can act as nominee shareholders, directors and secretaries.
9. What is the best way to guard against the risk of money laundering by bank staff?

A. Ensure that they key staff are registered with the regulator.
B. Ensure segregation of duties in all the tasks.
C. Conducting initial and ongoing criminal background checks.
D. Ensure manager review staff work properly.

10. What is the major money laundering risk associated with a number of prepaid cards as opposed to
credit or debit cards.

A. The risk of losing the prepaid cards.

B. The inability to load the card with the cash.
C. The global access to cash through ATMs.
D. The anonymous access to funds.
 CHAPTER 2

INTERNATIONAL AML / CFT STANDARDS

14 MCQs
11. In the FATF 40 recommendations, the focus of AML efforts has been expended beyond Financial
Institutions. Which three businesses and / or professions are covered? Choose 3 answers.

A. Casinos, when customer engage in financial transactions equal to or above a designated threshold.
B. Real Estate agents when they are involved in transactions for clients concerning buying & selling
properties.
C. Art dealers, when they engage in any cash transactions with a customer at or above designated
threshold.
D. Trust & company service providers.

12. According to the FATF Recommendations, “Designated non-financial businesses and professions”
include

A. Internet casinos, real estate agents and dealers in precious stones.

B. Money Service business, gatekeepers, and issuers of electronic money.
C. Dealers in Precious metals, lawyers, commodity futures traders.
D. Life insurance companies, real estate agents and notaries.
13. According to FATF 40 recommendations, the threshold for identifying occasional customers at
financial institutions is.

A. EURO / US$ 5,000.

B. EURO / US$ 10,000.
C. EURO / US$ 15,000.
D. EURO / US$ 20,000.

14. The NCCT list is:

A. The “Non-Cooperative Countries and Territories” list periodically issued by the FATF.
B. “Number of Countries Combating Terrorism” list issued periodically by United Nations.
C. A group of countries, based in Paris, cooperating in fighting money laundering & terrorism financing.
D. The “Non-Cooperative Countries & Territories” list periodically issued by the Wolfsberg Group.
15. According to FATF’s Money Laundering & Terrorist Financing Typologies 2003 – 2004, money
launderers use the insurance industry to clean their fund by:
1. Early redemption of policies.
2. Refining.
3. Filing false casualty claims on nonexistent objects.
4. Policy price manipulation.

A. 1 and 2
B. 1 and 3
C. 2 and 4
D. 1 and 4

16. Which of the following is not a level of compliant in FATF technical compliance assessment?

A. Fully Compliant.
B. Not applicable.
C. Partially Compliant.
D. Largely Compliant.
17. Which of the following is not the area of FATF’s main activities?

A. Standard Setting.
B. Ensuring effective compliance with standards.
C. Penalized Governments & PEPs involved in Money laundering.
D. Identifying money laundering and terrorist financing threats.

18. What is the definition of designated categories of offenses?

A. A. It means that crimes that offenders attempt to conceal through financial subterfuge that should
constitute precursor offenses to Money Laundering.
B. It means offenders will be categorized as ML whenever there is any concealment.
C. It is used to empower enforcement agencies to tackle these crimes.
D. It is used for tackling ML and TF easily.
19. The Wolfberg principles for Private Banking list circumstances that would require additional due
diligence, including activities that involve which three of these choices.

A. Foreign Jurisdiction.
B. High Risk Countries, including those identified by credible sources as having inadequate Anti-Money
Laundering Standards.
C. High Risk Activities, involving clients and beneficial owners whose source of wealth originates from
activities known to be vulnerable to money laundering.
D. Public officials, including those individuals who have or had positions of public trust.

20. Which primary international authoritative body designates sanctions?

A. Organization of Economic Co-operations and Development (OECD).

B. Financial Action Task Force (FATF).
C. International Monetary Fund (IMF).
D. United Nations (UN).
21. What was cited by the Wolfsberg's Group in its Statement on the suppression of the Financing of
Terrorism as being vulnerable to terrorist financing?

A. Private Banking.
B. Correspondent Banking.
C. Alternative remittance.
D. Trade Finance.

22. ________ is an association of 13 global banks that aims to develop standards on money laundering
controls for banks.

A. Egmont Group
B. European Union
C. GAFILAT
D. Wolfsberg Group
23. Which of the following elements of the KYC program are emphasized in the Basel Committee’s
2001 paper?

A. Risk Management.
B. Customer identification.
C. Monitoring.
D. All of the above.

24. Which of the following Section under the US Patriot Act allows the appropriate federal banking
agency to require a financial institution to produce within 120 hours (five days) records or information
related to the institution’s AML compliance or related to a customer of the institution or any account
opened, maintained, administered or managed in the US by the financial institution.

A. Section 314(a)
B. Section 319(b)
C. Section 314(b)
D. Section 311(a)
 CHAPTER 3

ANTI-MONEY LAUNDERING / COUNTER-

TERRORIST FINANCING COMPLIANCE
PROGRAMS

14 MCQs
25. According to experts, what is the most effective way to prevent money laundering through
financial institutions?

A. Ensuring that transaction monitoring systems can identify terrorist financing.

B. Collecting information on beneficial owners and foreign customers.
C. Instituting a policy prohibiting the acceptance of funds intended for terrorist financing.
D. Implementing a sound customer due diligence program.

26. The “Know Your Employee” (KYE) policy.

A. Relates to friendly, social relationship among employees of the same financial institution.
B. Is a key tool in detecting suspicious activity because employees are often accomplices of money
launderers.
C. Means that you should consider every employee as a suspicious one unless he or she is proved the
contrary.
D. Is a concerted effort by upper management to become personally acquainted with all employees.
27. Which one do the Office of Foreign Asset Control regulations not cover?

A. All persons and entities within the U.S.

B. All U.S.-domiciled entities and their foreign branches.
C. All foreign-based entities that have U.S. customers.
D. All U.S. citizens.

28. An anti-money laundering specialist at a large institution is responsible for information senior
management about the status of the anti-money laundering program across the organization.
Which report is the most useful?

A. The total credit exposure for non-cooperative countries and territories

B. Results of related audits and examinations
C. Details on inquires received from law enforcement
D. Notification of management changes in the different major divisions
29. What happens if a student’s checking account indicates a large number and volume of wires?

A. Its account status may change from higher risk to low-risk jurisdictions.
B. Its account status may change from low risk to middle-risk jurisdictions.
C. Its account status may change from low risk to higher risk jurisdictions.
D. Its account status may change from higher risk to no risk jurisdictions.

30. Which category of sanctions is aimed at key sectors of an economy to prohibit a very specific subset
of financial dealings within those sectors to impede future growth?

A. Comprehensive Sanctions.
B. Powerful sanctions.
C. Targeted Sanctions.
D. Sectoral Sanctions.
31. Select the most appropriate statement for OFAC:

A. OFAC is not a supervisory agency but works closely with supervisory agencies at both the federal and
state levels.
B. OFAC is a supervisory agency & does not work closely with other supervisory agencies at both the federal
and state levels.
C. OFAC is a secret intelligence agency that works in collaboration with the CIA.
D. OFAC is an institution developed to support terrorist financing.

32. The establishment and continual development of which of the following in a financial institution are
foundational to a successful AML/CFT program?

A. Policies.
B. Procedures.
C. Controls.
D. All of the above.
33. What should senior management do in order to promote a culture of anti-money laundering
compliance?

A. They should include compliance with AML procedures as condition of employment.

B. They should attend all training sessions with front-line employment.
C. They should have close ties with the independent auditors of the AML program.
D. They should base employee compensation on the amount of suspicious activity they detect.

34. When conducting a review on a customer, the wife of a PEP might bring higher risk, which of the
following is the reason behind?

A. Her husband may use her for the illicit fund's transfer.
B. It is assumed that she will be scrutinized less than her husband.
C. She can go behind her husband back to obtain extra money.
D. She is more likely to be vulnerable to bribery than her husband.
35. A financial institution is looking to establish an online account opening service. The institution plans
to offer this product to new and existing customers within the country. Which of the following would be
the best plan of action for an AML specialist to recommend enabling the institution to verify the
customer’s identity?

A. Do not offer the product, because it is too high risk because the customers cannot be seen to verify their
identities.
B. Require all customers to send a copy of valid photo identification to the institution.
C. Ensure that the institution has a reliable third-party source that will enable verification of the customers.
D. Allow customers to enter required information but require all customers to come to the institution in
person for verification.

36. Which of the following customer type is not inherently high risk?

A. Car dealer
B. Embassies
C. Import / Export Companies
D. Travel Agencies
37. The arrangement of a compliance officer with designated compliance functions is categorized as
which line of defense?

A. First
B. Second
C. Third
D. Not a line of defense

38. What one factor could cause a financial institution not to update its existing AML program?

A. The launch of a new product

B. The acquisition of another financial institution
C. The election of a new board of directors
D. The passage of time (e.g., 12–18 months)
 CHAPTER 4

CONDUCTING & RESPONDING TO

INVESTIGATIONS

12 MCQs
39. What facilitates law enforcement agent obtaining evidence from authorities in a foreign country relating
to criminal activity?

A. Mutual Legal Assistance Treaties (MLAT).

B. Patriot Act Communications System.
C. The Worldwide Network of Information Sharing.
D. MLAT Executive Agreement.

40. An AML compliance officer receives notice of government update including the names of the latest
terrorists sanctioned by the United Nations Security Council. Which would be the most appropriate step to
take?

A. Notify the Board of Directors.

B. Update the monitoring software containing sanctioned persons.
C. Inform the customers that their funds will be frozen.
D. Update training information to include the latest names.
41. What should a compliance officer do during an ongoing investigation into a client’s activities by a
competent authority?

A. Ensure communication with regulatory & law enforcement authorities is conducted only through the Board of
Directors.
B. Communicate only in writing with regulatory & law enforcement authorities in line with applicable local law.
C. Communicate with regulatory & law enforcement authorities in line with applicable local laws.
D. Only provide information that is specifically & directly requested.

42. After an institution files an STR with regard to a particular account, a law enforcement agent requests
the institution to keep the account open until advised otherwise by law enforcement. What step should the
institute take?

A. Close the account in order not to be caught in the middle of the law enforcement investigation.
B. Follow the request of law enforcement agent & keep the account open.
C. Request a written letter from the law enforcement (agency signed by an appropriate authorized signature).
D. Keep the account open only if only it complies with the bank own AML procedures.
43. What is most valuable when using the internet as an investigative source?

A. A team of AML investigators.

B. A reference list of websites known to yield credible information.
C. A combination of independent thinking and technical skills.
D. A powerful search engine.

44. In order to protect investigative materials from disclosure when conducting an internal investigation
of any employee of a financial institution, legal counsel of that financial should ____________?

A. Request formal company authorization to conduct the investigation, such authorization should be granted, if
possible, by the board of directors or audit committee.
B. Refuse to provide any records or documents to law enforcement because the bank has client privilege with its
bank customers.
C. Let the bank fire any and all contract investigators to conduct the internal investigation. That way legal is not a
party to the action and may remain independent.
D. Not mark files or documents with privileged and confidential; attorney-client privilege and/or work-product.
Those marks will only encourage law enforcement or opposing attorneys to seize those files.
45. Whenever an institution receives a subpoena, search warrant, or similar law enforcement demand,
or becomes aware of a government-related investigation involving the institution, it should conduct
which of the following?

A. An inquiry of its own to determine the underlying facts.

B. An inquiry of its own to determine the institution’s exposure.
C. What steps the institution should take.
D. All of the above.

46. Which of the following do not need to use subpoenas or search warrants or other jurisdiction-
specific legal mechanisms?

A. Auditors
B. Banking regulatory agencies
C. Government officers
D. Financial Authority Task Force
47. Which of the following are usually issued by grand juries, operating under the purview of a court
and empower a law enforcement agency to compel the production of documents and testimony?

A. Arrest warrants
B. Investigations
C. Search warrants
D. Subpoenas

48. What are the most suitable answer below for the rationale for an interview the employee ASAP when
the incident happens?

A. To ensure the employee memories is freshest.

B. To ensure the employee has not yet resigned.
C. To ensure that the employee maintained a proper record.
D. To ensure that the employee has not left their respective countries.
49. What is a tool government & multi-national bodies can use to prevent the proliferation of weapons of
mass destruction?

A. Economic sanctions.
B. Commission Rotaries.
C. Account Monitoring order.
D. Mutual Legal Assistant Treaty.

50. Suzy, the AML compliance officer for a large financial organization, is asked by her board of directors
to review how best to protect the confidentiality of STRs submitted by the organization and the
confidential information contained therein. What are three things she should consider?

A. Ensure that employees know how to retrieve STRs by the name of the customer quickly and efficiently.
B. Ensure training of employees so that they do not inadvertently inform, or tip off, the targeted customer of
the filing.
C. Ensure strong record-keeping procedures to segregate information pertaining to STRs and to maintain
their confidentiality.
D. Ensure that procedures are in place to promptly and appropriately respond to requests for copies of filed
STRs.
ANSWERS
1. A, C, D 11. B, C, D 21. C 31. A 41. A

2. A, C 12. A 22. D 32. A 42. C

3. B 13. C 23. D 33. A 43. B

4. A, C 14. A 24. B 34. A 44. A

5. C 15. B 25. D 35. C 45. D

6. A, B, D 16 A 26. B 36. D 46. B

7. C 17. C 27. A 37. B 47. D

8. A 18. A 28. B 38. C 48. A

9. C 19. B, C, D 29. C 39. A 49. A

10. D 20. D 30. D 40. B 50. B, C, D

“Don’t call your goal as a dream, call it a
plan and you will definitely achieve it.”

The End.