ACAMS Updated CAMS Exam Questions and Answers by avery

Economic sanctions are penalties imposed by one or more countries against another country, group, or individual for violatinginternational norms or threatening national interests1. The ultimate goal of economic sanctions is to protect national security by changing the behavior or policies of the target, or by weakening its capabilities or resources2. Sanctions can be used to advance various foreignpolicy objectives, such as counterterrorism, nonproliferation, democracy promotion, human rights protection, conflict resolution, and cybersecurity1. Sanctions can take different forms, such as travel bans, asset freezes, trade embargoes, arms restrictions, and aid reductions1. Sanctions can be applied unilaterally by one country, or multilaterally by a coalition of countries or an international organization, such as the United Nations or the European Union1.

1: What Are Economic Sanctions? | Council on Foreign Relatio

2: How Economic Sanctions Work - Investopedia

Asset management companies handlelarge amounts of funds, making themprime targets for money launderers.

Option A (Correct):Negative news (adverse media) screeningis essential for identifyingpotential financial crime risks.

Option D (Correct):Understanding thesource and origin of assetsensures that fundscome from legitimate sources.

Option B (Incorrect):PEPs should not be automatically rejected, butenhanced due diligence (EDD)is required.

Option C (Incorrect):While onboarding interviews help,they are not a mandatory AML measure.

Option E (Incorrect):Financial stability reportsare useful, butnot directly linked to AML compliance.

AML Risks in Asset Management:

High-value transactions that may mask illicit wealth.

Layering through investment portfolios to hide the origin of funds.

Use of offshore structures to evade regulatory scrutiny.

Best Practices for AML in Asset Management:

Conduct enhanced due diligence (EDD) on high-net-worth clients.

Monitor large and unusual transactions.

Screen customers against PEP, sanction, and adverse media databases.

USA PATRIOT Act Section 319(b)gives theU.S. governmentthe power toseize fundsfroma U.S. correspondent bank account held for a foreign bank, if the funds are linked to illicit activity.

Option C (Correct):Section 319(b) explicitly allows asset forfeiturefromforeign correspondent bank accounts in the U.S.

Option A (Incorrect):Section 319(a)grants U.S. regulatorsfaster access to bank records(within120 hours).

Option B (Incorrect):Section 314(a)deals withinformation sharing between banks and law enforcement.

Option D (Incorrect):Section 314(b)allowsbanks to voluntarily share AML information among themselves.

Assessing AML/CFT is an ongoing and evolving component of maintaining a compliant AML/CFT program. Evaluating the risk-scoring model and conducting the risk assessment itself may need to be performed annually, every 18 to 24 months, before the launch of a new product or when an acquisition of another financial institution occurs.