ACAMS Updated CAMS Exam Questions and Answers by maysa

The Belgian bank should freeze the assets of the customer and report to OFAC, as this is the required action for any US person or entity, or any person or entity within the US, that holds or controls property or interests in property of a person or entity on the OFAC Specially Designated Nationals and Blocked Persons List (SDN List). The SDN List is a list of individuals and entities that are subject to US sanctions and whose assets are blocked by OFAC. The Belgian bank, by maintaining a branch in New York, is subject to the jurisdiction and authority of OFAC, and must comply with its regulations and directives. Allowing transactions, closing the account, or continuing business as usual would violate the sanctions and expose the bank to civil and criminal penalties.

Bank A should file a suspicious transaction report (STR) on the transaction in Country A, as it is the financial institution that observes and processes the suspicious activity in its jurisdiction. According to the FATF Recommendations, financial institutions should report any transaction that they have reason to suspect is related to money laundering, terrorist financing, or other criminal activities, regardless of the amount involved1. The STR should include information about the originator, the beneficiary, and the purpose of the transaction, as well as the reasons for suspicion2. Bank A should also comply with any legal or regulatory requirements in Country A regarding the reporting of cross-border wire transfers3.

1: FATF Recommendation 20 - Reporting of suspicious transactions

2: FATF Interpretive Note to Recommendation 20

3: FATF Recommendation 16 - Wire transfers

OFAC sanctions apply extraterritoriallyto ensureU.S. financial and economic interests are protected.

Option A (Correct):U.S. citizensmust comply with OFAC sanctionsregardless of where they are located.

Option D (Correct):U.S.-incorporated entities and their foreign branchesare required to followOFAC restrictions.

Option E (Correct):Permanent U.S. resident aliensare subject toOFAC complianceeven outside the U.S.

Option B (Incorrect):Non-U.S. financial institutionsare notdirectly subject to OFACunless they have aU.S. presenceordeal in USD transactions.

Option C (Incorrect):Selling U.S.-origin goods does not automatically subject merchants to OFAC laws, unless they are in asanctioned jurisdiction.

According to the Basel Committee's principles on customer due diligence, banks must obtain the necessary information to establish the identity of their customers, beneficial owners, and any persons acting on behalf of their customers. This includes verifying the identity of the customer and the beneficial owners and assessing the customer's risk profile. Additionally, banks must conduct ongoing due diligence to ensure that the customer does not give rise to suspicions of money laundering or terrorist financing [1].