Free ACAMS CAMS Practice Exams - Page 2 of 39

Question #11

In performing a risk analysis, which factor(s) should a financial institution review?

A . The level of its gross revenue
B . Recent regulatory actions against financial institutions of comparable size
C . Its customer base, location, products and services
D . The adequacy and completeness of its STR filings

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Question #12

Which payment method for purchasing luxury items is a red flag for potential money laundering?

A . Personal loan
B . Cash
C . Wire transfer
D . Credit card

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Question #12

Which payment method for purchasing luxury items is a red flag for potential money laundering?

A . Personal loan
B . Cash
C . Wire transfer
D . Credit card

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Question #14

Which of the following customers require the most enhanced due diligence?

A . A resident of a non-cooperative jurisdiction.
B . An international business corporation.
C . A politically exposed person.
D . An established customer.

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Correct Answer: C
C

Explanation:

A politically exposed person (PEP) is a customer who requires the most enhanced due diligence (EDD). This is because PEPs are individuals who hold or have held prominent public positions, such as heads of state, senior politicians, judges, military officers, or directors of state-owned enterprises, and who may pose a higher risk of money laundering, corruption, or bribery due to their influence and access to public funds1. EDD measures for PEPs may include obtaining senior management approval, establishing the source of wealth and funds, and conducting enhanced ongoing monitoring of the business relationship2.

The other customers listed do not necessarily require the most EDD, although they may still present a higher risk of money laundering depending on the circumstances. A resident of a non-cooperative jurisdiction is a customer who lives in a country or territory that has been identified by the Financial Action Task Force (FATF) or other international bodies as having weak or deficient anti-money laundering (AML) standards or posing a threat to the international financial system3. EDD measures for such customers may include obtaining additional information or documentation, applying extra scrutiny to transactions, or refusing to establish or continue the business relationship4. An international business corporation is a customer who operates in multiple jurisdictions and may have complex or opaque ownership structures that can conceal the identity or activity of the beneficial owners or controllers. EDD measures for such customers may include verifying the legal existence and structure of the entity, identifying the beneficial owners and controllers, and understanding the nature and purpose of the business relationship. An established customer is a customer who has a long-standing and regular business relationship with the financial institution and who may have a lower risk of money laundering due to the familiarity and trust that has been built over time. EDD measures for such customers may not be required unless there are changes in the customer’s profile, behavior, or risk level.

Reference: 1: Politically Exposed Persons (Recommendations 12 and 22) – FATF1 2: High-risk customers, including politically exposed persons | FCA2 3: High-Risk and Other Monitored Jurisdictions – FATF3 4: Your responsibilities under money laundering supervision | GOV.UK4: International Business Corporations – ACAMS: Anti-Money Laundering Customer Due Diligence | Veriff.com: Customer Due Diligence – ACAMS: Anti-money laundering C a guide to customer due diligence

Question #15

Which of the following corporate structures present a higher money laundering risk due to reduced transparency? (Select Three.)

A . A company with nominee shareholders and directors in a local jurisdiction.
B . A private company with no activity in a tax haven jurisdiction.
C . A company with bearer shares incorporated in a tax haven jurisdiction.
D . A limited liability company (LLC) incorporated in a foreign jurisdiction.
E . A private investment company incorporated in a tax haven jurisdiction with strict secrecy laws.

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Question #16

A high volume of incoming wire transfers generates an alert about a client. The funds are

immediately debited by cash withdrawals and outgoing wire transfers.

Which information should be reviewed first to investigate this alert/case?

A . Customer profile
B . Adverse media search
C . Account activity
D . Open source information

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Question #17

Which of the following is the best action to take regarding a particular account once suspicious

activity is reported by the institution?

A . Notify the client that the transaction has been reported.
B . Freeze the funds pending notification from the competent authority.
C . Secure all supporting documentation.
D . Immediately close the account.

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Question #18

Which event occurs most frequently in money laundering in the insurance industry?

A . Getting a reimbursement from an overfunded policy
B . Purchasing full-term insurance bonds
C . Failing to take advantage of the free-look period
D . Redeeming a policy at the end of its term

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Question #19

The Egmont Group Statement of Purpose

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

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Question #20

Customers of a telecommunications firm received an email explaining an issue with their last order. The customers were directed to the company website via a link in the email to provide personal information. Both the email and website were fake.

What type of cybercrime has been committed?

A . Malware
B . Cryptojacking
C . Spear phishing
D . Tumbling

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