ACAMS Updated CAMS Exam Questions and Answers by gideon

TheFATF Grey Listconsists of jurisdictionsunder increased monitoringdue tostrategic deficiencies in their AML/CFT frameworks.

Option A (Correct):Countries placed on thegrey listhaveidentified weaknessesbutcommit to addressing them within set timeframes.

Option B (Incorrect):High-risk jurisdictions that fail to cooperate are placed on theblacklist, not the grey list.

Option C (Incorrect):While additional reviews may occur,grey-listed countries follow an agreed-upon action plan, not an automatic re-evaluation.

Option D (Incorrect):FATF does not impose financial penalties; instead, itmonitors progress and issues public reports.

An AML audit is a process of evaluating an organization’s compliance with AML regulations and best practices. The audit report should provide feedback on the strengths and weaknesses of the organization’s AML program and identify any gaps or deficiencies that need to be addressed. The compliance program should use the audit findings as an opportunity to improve its AML risk management and internal controls, and to implement corrective actions as needed. The audit findings should not be ignored or dismissed, but rather used as a tool to enhance the organization’s AML compliance performance and effectiveness.

 According to the Wolfsberg Group, the FI should take the following steps regarding the opening of the account for the senior government official:

Reasonably establish if the source of wealth and funds of the official is legitimate. This is to ensure that the FI is not facilitating the laundering of proceeds of corruption, bribery, or other illicit activities by the official, who is considered a politically exposed person (PEP) and poses a higher risk of financial crime. The FI should obtain information and documentation on the origin andownership of the funds, the official’s income and assets, and the purpose and expected activity of the account12.

Perform due diligence procedures on the managing intermediary. This is to verify the identity, reputation, and regulatory status of the intermediary, who acts as a third party on behalf of the official. The FI should also assess the intermediary’s own AML/CFT policies and controls, and the nature and extent of the relationship between the intermediary and the official13.

Determine whether the intermediary representative is acting on the officer’s behalf. This is to establish the beneficial ownership and control of the account, and to avoid any potential conflicts of interest or undue influence by the intermediary. The FI should obtain a written confirmation from the intermediary that they are authorized to act on behalf of the official, and that they will disclose any changes in the beneficial ownership or control of the account13.

A comprehensive risk analysis is the first and most important step in developing an effective anti-money laundering program. A risk analysis helps a financial institution identify and assess its exposure to money laundering and terrorist financing risks, based on its products, services, customers, geographic locations, and other factors. A risk analysis also enables a financial institution to tailor its policies, procedures, controls, and training to mitigate the specific risks it faces. A risk analysis should be conducted periodically and updated as necessary to reflect changes in the institution’s risk profile.

ACAMS Study Guide for the CAMS Certification Examination, 6th Edition, Chapter 2: Compliance Standards for Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT), Section 2.1: Risk-Based Approach, p. 29-30

ACAMS Risk Assessment, What is Anti-Money Laundering (AML) Risk Assessment?

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