How do nominees benefit criminals misusing thorn for money laundering purposes? (Select Two.)
Correct Answer: B,C
Question 62
A compliance officer is reviewing an institutional banking prospect proposal for a new foreign entity that is a multinational business but headquartered in a country where most businesses are state-owned. Which risks should be prioritized in the review? (Choose two.)
Correct Answer: A,C
The review should prioritize politically exposed persons (PEPs) risk, as state ownership increases the likelihood of political connections, and anti-bribery and corruption risk, since such environments may have higher exposure to corrupt practices and misuse of influence.
Question 63
Which of the following are important AML controls for a compliance manager of a regulated asset management company in the European Union to implement? (Select Two.)
Correct Answer: C,D
* Understanding the source and origin of assets (C):According to the CAMS 6th Edition (Chapter: Customer Due Diligence and Enhanced Due Diligence) and the EU 4th & 5th AML Directives, regulated entities are required to take adequate measures to understand the source of funds and the origin of assets of their customers, especially when there are higher risk factors such as large transactions or PEPs."Firms must identify the source and origin of assets to ensure they are not the proceeds of crime or corruption, particularly for higher-risk customers."(CAMS 6th Edition, CDD/EDD Requirements; EU Directive 2015/849, Article 20) * Performing negative news checks of prospective customers (D):Adverse media screening is an essential part of the onboarding process for identifying potential risks related to money laundering, terrorist financing, or reputational harm."Negative news or adverse media checks form a vital component of the due diligence process, helping organizations detect links to criminal or suspicious activities."(CAMS 6th Edition, CDD/EDD Requirements) Incorrect Options: * A: Onboarding interviews may be part of EDD, but are not a standard or required AML control. * B: PEPs are not to be automatically rejected; instead, enhanced due diligence should be applied. * E: Producing financial stability reports is not an AML control, but may be relevant for credit or investment assessment. References: CAMS Study Guide 6th Edition, Customer Due Diligence EU 4th AML Directive (Directive 2015/849/EU) EU 5th AML Directive (Directive 2018/843/EU)
Question 64
Which statement is the most accurate describing who must comply with Office of Foreign Assets Control (OFAC) sanctions?
Correct Answer: B
Question 65
A national risk assessment (NRA) can impact the risk-based approach (RBA) within an organization's anti- financial crime (AFC) compliance program by: (Choose two.)
Correct Answer: A,C
A national risk assessment can identify high-risk sectors requiring enhanced due diligence and guide resource allocation to mitigate financial crime risks effectively, helping organizations align their risk-based approach with national priorities and threats.
