ACAMS Exam 203 Questions with Verified Answers,100% CORRECT

ACAMS Exam 203 Questions with Verified Answers Structuring - CORRECT ANSWER Designing a transaction to evade triggering a reporting or record-keeping requirement. Smurfing - CORRECT ANSWER Multiple individuals ma ...

ACAMS Exam 203 Questions with Verified Answers Structuring - CORRECT ANSWER Designing a transaction to evade triggering a reporting or record-keeping requirement. Smurfing - CORRECT ANSWER Multiple individuals making multiple cash deposits and/or buying multiple monetary instruments or bank drafts in amounts under the reporting threshold in an attempt to evade detection Microstructuring - CORRECT ANSWER Structuring done at a much smaller level Wash-trading or "offsetting" accounts - CORRECT ANSWER The entry of matching buys and sells in particular securities; which provides the illusion of trading. It generates offsetting profits and losses through multiple accounts. Free Trade Zone (FTZ) - CORRECT ANSWER Designated geographic areas with special regulatory and tax treatments for certain trade-related goods and services. Trade-Based Money Laundering - CORRECT ANSWER The process of disguising the proceeds of crime and moving value through the use of trade transactions in an attempt to legitimize their illicit origins. Over Invoicing - CORRECT ANSWER Invoicing goods or services at a price above the fair market price. Under Invoicing - CORRECT ANSWER Invoicing goods or services at a price below the fair market price. Over-shipping or Short-shipping - CORRECT ANSWER The difference in the invoiced quantity of goods and the quantity of goods that are shipped whereby the buyer or seller gains excess value based on the payment made. Ghost-shipping - CORRECT ANSWER Fictitious trades where a buyer and seller collude to prepare all the documentation indicating goods were sold, shipped and payments were made, but no goods were actually shipped. Shell companies - CORRECT ANSWER Corporate entities created with a view to to reduce the transparency of ownership in a transaction. Multiple Invoicing - CORRECT ANSWER A form of trade-based money laundering whcih involved the use of numerous invoices issued for the same shipment of goods, thus allowing the money launderer the opportunity to make numerous payments and justify them with the invoices. Black Market Trades - CORRECT ANSWER Commonly referred to as the Black Market Peso Exchange whereby a domestic transfer of funds is used to pay for goods by a foreign importer Letters of Credit - CORRECT ANSWER A credit instrument issued by a bank that guarantees payments on behalf of its customer to a third party when certain conditions are met Funnel Accounts - CORRECT ANSWER an individual or business account in one geographic area that receives multiple cash deposits, often in amounts below the cash reporting threshold, and from which the funds are withdrawn in a different geographic area with little time elapsing between the deposits and withdrawals. Black Market Peso Exchange - CORRECT ANSWER A process by which money in the United States derived from illegal activity is purchased by Colombian peso brokers and deposited in US bank accounts that the brokers have established. Electronic Purses - CORRECT ANSWER Cards that electronically store value on integrated circuit chips. Unlike pre-paid credit cards with magnetic stripes that store account information, funds are stored on memory chips. Virtual Currency (Digital Currency) - CORRECT ANSWER A medium of exchange that operates in the digital space. It can be converted into either a fiat (e.g., a government-issued currency) or it can be a substitute for real currency. International Business Company (IBC) - CORRECT ANSWER Entities formed outside of a person or businesses' country of residence, typically in offshore jurisdictions, for confidentially or asset protection purposes. Shelf Company - CORRECT ANSWER A corporation that has had no activity. It has been created and put on the shelf. This corporation is then later sold to someone who prefers a previously registered corporation over a new one. Shell Company - CORRECT ANSWER A company that at the time of incorporation has no significant assets or operations. Asset Protection Trusts - CORRECT ANSWER A special form of irrevocable trust usually created offshore for the principle purpose of preserving one's wealth from creditors. The Hawala System - CORRECT ANSWER An informal value transfer system involving the international transfer of value outside the legitimate banking system and based on a trusted network of individuals. Numbered Account - CORRECT ANSWER A bank account where the identity of the account holder is not disclosed in the title of an account, and identification to effect transactions takes place using a code word or number known only by the account holder and a restricted number of bank employees, thus providing the account holder with a degree of bank privacy in their financial transactions. Comitology - CORRECT ANSWER The EU system that oversees the implementation of acts proposed by the European Commission. Third Country Citizen - CORRECT ANSWER Individuals who are in transit and/or applying for visas in countries that are not their country of origin (i.e. country of transit) The Wolfsberg Group - CORRECT ANSWER An association of 13 global banks that aims to develop financial services industry standards and guidance related to Know Your Customer, Anti-Money Laundering and Counter-Terrorist Financing policies. Egmont Group - CORRECT ANSWER An informal networking group of financial intelligence units CICAD - CORRECT ANSWER Commission within the Organization of American States that deals with drug related issues, including money laundering World Bank and International Monetary Fund - CORRECT ANSWER These organizations work together and in conjunction with FATF to encourage countries to have adequate anti- money laundering laws and to review anti-money laundering laws and procedures of FATF member countries. Money Laundering Control Act of 1986 - CORRECT ANSWER The world's first law to criminalize money laundering. Section 311: US Patriot Act - CORRECT ANSWER Section of the US Patriot Act that provides the US Treasury Department with the authority to apply graduated, proportionate measures against a foreign jurisdiction, a foreign financial institution, a type of international transaction or a type of account that the Treasury Secretary determines to be a "primary money laundering concern." Section 312: US Patriot Act - CORRECT ANSWER Section of the US Patriot Act which requires due diligence and, in certain situations, enhanced due diligence for foreign correspondent accounts (which includes virtually all account relationships that institutions can have with a foreign financial institution) and private banking for non-US persons. Section 313: US Patriot Act - CORRECT ANSWER Section of the US Patriot Act which prohibits US banks and securities brokers and dealers from maintaining correspondent accounts for foreign, unregulated shell banks that have no physical presence anywhere. Section 314 (A): US Patriot Act - CORRECT ANSWER Section of the US Patriot Act that enables US federal, state, local, and foreign (European Union) law enforcement agencies, through FinCEN, to reach out to more than 43,000 points of contact at more than 22,000 financial institutions to locate accounts and transactions of persons that may be involved in terrorism or money laundering. Section 314 (B): US Patriot Act - CORRECT ANSWER Section of the US Patriot Act which provides financial institutions with the ability to share information with one another, under a safe harbor that offers protections from liability, in order to better identify and report potential money laundering or terrorist activities. Section 319 (A): US Patriot Act - CORRECT ANSWER In situations where funds have been deposited with a foreign bank, this section permits the US government to seize funds in the same amount from a correspondent bank account in the US that has been opened and maintained for the foreign bank. Section 319 (B): US Patriot Act - CORRECT ANSWER This section of the US Patriot Act allows the appropriate federal banking agency to require a financial institution to produce within 120 hours (five days) records or information related to the institution's AML compliance or related to a customer of the institution or any account opened, maintained, administered or managed in the US by the financial institution. Specified Unlawful Activity - CORRECT ANSWER Virtually every US crime that produces economic advantage, including aircraft piracy, wire fraud, bank fraud, copyright infringement, embezzlement, export violations, illegal gambling, narcotics offenses, racketeering and even some environmental crimes. Willful Blindness - CORRECT ANSWER The deliberate avoidance of knowledge of the facts. Office of Foreign Assets Control - CORRECT ANSWER A unit of the US Treasury Department which administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries, terrorists, international narcotics traffickers and those engaged in activities related to the proliferation of weapons of mass destruction. The Compliance Function - CORRECT ANSWER Commonly referred to as a second line of defense. The Control Function - CORRECT ANSWER Commonly referred to as a first line of defense. Targeted Sanctions - CORRECT ANSWER Sanctions aimed at specifically named individuals, such as key leaders in a country or territory, named terrorists, significant narcotics traffickers and proliferators of weapons of mass destruction. These sanctions often include the freezing of assets and travel bans where possible. Sectoral Sanctions - CORRECT ANSWER Sanctions aimed at key sectors of an economy to prohibit a very specific subset of financial dealings within those sectors to impede future growth. Comprehensive Sanctions - CORRECT ANSWER Sanctions that generally prohibit all direct or indirect import/export, trade brokering, financing or facilitating against most goods, technology and services. These are often aimed at regimes responsible for gross human rights violations, and nuclear proliferation. UN Security Council Meetings - CORRECT ANSWER Bodies that are responsible for managing UN Sanctions. Article 215 - CORRECT ANSWER Section of the Treaty on the Functioning of the European Union (TFEU) that provides a legal basis for the interruption or reduction, in part or completely, of the Union's economic and financial relations with one or more third countries (i.e., countries outside the EU), where such restrictive measures are necessary to achieve the objectives of the Common Foreign and Security Policy(CFSP). Specially Designated Nationals and Blocked Persons (SDN) list - CORRECT ANSWER A comprehensive list issued by the U.S. Office of Foreign Assets Control (OFAC) which contains thousands of names of individuals and businesses, as well as aircraft and ships ("vessels") from more 150 countries that the US government considers to be terrorists, international narcotics traffickers, or others covered by US foreign policy and trade sanctions. Sanctions Screening - CORRECT ANSWER The process of reviewing the various country sanction program requirements, as well as published lists of known or suspected terrorists, narcotics traffickers, and other criminal actors for potential matches. Tipping Off - CORRECT ANSWER Disclosing the filing of a suspicious transaction report to the subject of the report. Inernational Money Laundering Information Network (IMoLin) - CORRECT ANSWER A clearinghouse of money laundering information for the benefit of national and international anti-money laundering agencies. Affidavit - CORRECT ANSWER A written statement given under oath before an officer of the court, notary public, or other authorized person. It is commonly used as the factual basis for an application for a search, arrest or seizure warrant. Alternative Remittance System (ARS) - CORRECT ANSWER Underground banking or Informal Value Transfer Systems (IVTS). Often associated with ethnic groups from the Middle East, Africa or Asia, and commonly involves the transfer of values among countries outside of the formal banking system. The remittance entity can be an ordinary shop selling goods that has an arrangement with a correspondent business in another country. There is usually no physical movement of currency and a lack of formality with regard to verification and record- keeping. The money transfer takes place by coded information that is passed through chits, couriers, letters, faxes, emails, text messages, or online chat systems, followed by some form of telecommunications confirmations. Anti-Money Laundering International Database (AMLID) - CORRECT ANSWER A compendium of analyses of anti-money laundering laws and regulations, including two general classes of money laundering control measures—domestic laws and international cooperation—as well as information on national contacts and authorities. A secure, multilingual database, AMLID is an important reference tool for law enforcement officers involved in cross-jurisdictional work. Anti-Money Laundering Program - CORRECT ANSWER The system designed to assist institutions in their fight against money laundering and terrorist financing. In many jurisdictions, government regulations require financial institutions, including banks, securities dealers and money services businesses, to establish such programs. At a minimum, the anti-money laundering program should include: 1. Written internal policies, procedures and controls; 2. A designated AML compliance officer; 3. On-going employee training; and 4. Independent review to test the program Arrest Warrant - CORRECT ANSWER A court order directing a law enforcement officer to seize and detain a particular person and require them to provide an answer to a complaint or otherwise appear in court. Asia/Pacific Group on Money Laundering (APG) - CORRECT ANSWER A Financial Action Task Force (FATF)-style regional body consisting of jurisdictions in the Asia/Pacific Region. Asset Protection - CORRECT ANSWER A process that includes reorganizing how assets are held so as to make them less vulnerable should a claim be made against a person. Asset protection is also a term used by tax planners for measures taken to protect assets from taxation in other jurisdictions. Asset Protection Trusts (APTs) - CORRECT ANSWER A special form of irrevocable trust usually created (i.e., settled) offshore for the principal purposes of preserving and protecting part of one's wealth from creditors. Title to the asset is transferred to a person named the trustee. APTs are generally used for asset protection and are usually tax neutral. Their ultimate function is to provide for the beneficiaries. Some proponents advertise APTs as allowing foreign trustees to ignore U.S. court orders and to simply transfer the trust to another jurisdiction in response to legal action threatening the trust's assets. Automated Clearing House (ACH) - CORRECT ANSWER An electronic banking network that processes large volumes of both credit and debit transactions that originate in batches. ACH credit transfers include direct deposit payroll payments and payments to contractors and vendors. ACH debit transfers include consumer payments on insurance premiums, mortgage loans and other kinds of expenses. Automated Teller Machine (ATM) - CORRECT ANSWER An electronic banking outlet that allows customers to complete basic transactions without the assistance of a bank employee. ATMs generally dispense cash, allow check and cash deposits and transfers to be made, as well as balance inquiries. Bank Draft - CORRECT ANSWER Vulnerable to money laundering because it represents a reputable international monetary instrument drawn on a reputable institution, and is often made payable—in cash— upon presentation and at the issuing institution's account in another country. Bank Secrecy - CORRECT ANSWER Refers to laws and regulations in countries that prohibit banks from disclosing information about an account—or even revealing its existence—without the consent of the account holder.Impedes the flow of information across national borders among financial institutions and their supervisors. Bank Secrecy Act (BSA) - CORRECT ANSWER The primary U.S. anti-money laundering regulatory statute (Title 31, U.S. Code Sections 5311-5355) enacted in 1970 and most notably amended by the USA PATRIOT Act in 2001. Among other measures, it imposes money laundering controls on financial institutions and many other businesses, including the requirement to report and to keep records of various financial transactions. Bank Secrecy Act (BSA) Compliance Program - CORRECT ANSWER A program that U.S.-based financial institutions—as defined by the Bank Secrecy Act—are required to establish and implement in order to control money laundering and related financial crimes. The program's components include at a minimum: the development of internal policies, procedures and controls; the designation of a compliance officer; ongoing employee training; and an independent audit function to test the program. Basel Committee on Banking Supervision (Basel Committee) - CORRECT ANSWER Established by the G-10's central bank of governors in 1974 to promote sound supervisory standards worldwide. Its secretariat is appointed by the Bank for International Settlements in Basel, Switzerland. It has issued, among others, papers on customer due diligence for banks, consolidated KYC risk management, transparency in payment messages, due diligence and transparency regarding cover payment messages related to cross-border wire transfers, and sharing of financial records among jurisdictions in connection with the fight against terrorist financing. Batch Processing - CORRECT ANSWER A type of data processing and data communications transmission in which related transactions are grouped together and transmitted for processing, usually by the same computer and under the same application. Bearer Form - CORRECT ANSWER Enables a designated investment or deposit to be sold, transferred, surrendered or addressed to a bearer without the need to obtain further written instructions. Bearer Negotiable Instruments - CORRECT ANSWER Includes monetary instruments in bearer form such as: negotiable instruments (including checks, promissory notes and money orders) that are either in bearer form, are endorsed without restriction, are made out to a payee, or are otherwise in such form that title thereto passes upon delivery. Bearer Share - CORRECT ANSWER Negotiable instruments that accord ownership in a corporation to the person who is in physical possession of the bearer share certificate, a certificate made out to "Bearer" and not in the name of an individual or organization. Benami Account - CORRECT ANSWER Also called a nominee account. Held by one person or entity on behalf of another or others. They are associated with the hawala underground banking system of the Indian subcontinent. A person in one jurisdiction seeking to move funds through a hawaladar to another jurisdiction may use a this type of account to disguise his/her true identity or the identity of the recipient of the funds. Beneficial Owner - CORRECT ANSWER The natural person who ultimately owns or controls an account through which a transaction is being conducted. Alternatively, these individuals are also known as the natural persons who have significant ownership of, as well as those who exercise ultimate effective control over, a legal person or arrangement. Beneficiary - CORRECT ANSWER The person (natural or legal) who benefits from a transaction, such as the party receiving the proceeds of a wire, a payout on an insurance policy. In the trust context, all trusts must have at least one of these, which may include the settlor. Bill Stuffing - CORRECT ANSWER A casino customer goes to various slot machines putting cash in the bill acceptors and collects cash-out tickets with nominal gaming activity, then cashes out at the casino cage or asks for a check. Black Market Peso Exchange (BMPE) - CORRECT ANSWER An example of a complex method of trade-based money laundering. It originally was driven by Colombia's restrictive policies on currency exchange. To circumvent those policies, Colombian businesses bypassed the government levies by dealing with peso brokers that dealt in the black market or parallel financial market. Colombian drug traffickers took advantage of this method to receive Colombian pesos in Colombia in exchange for U.S. drug dollars located in the U.S. Cardholder - CORRECT ANSWER Person to whom a financial transaction card is issued, or an additional person authorized to use the card. Caribbean Financial Action Task Force (CFATF) - CORRECT ANSWER A FATF-style regional body comprising Caribbean nations, including Aruba, the Bahamas, the British Virgin Islands, the Cayman Islands and Jamaica. Casa de Cambio - CORRECT ANSWER Also called a "bureau de change" or an "exchange office," a casa de cambio offers a range of services that are attractive to money launderers: currency exchange and consolidation of small denomination bank notes into larger ones; exchange of financial instruments such as travelers checks, money orders and personal checks; and telegraphic transfer facilities. Cash-Intensive Business - CORRECT ANSWER Any business in which customers usually pay with cash for the products or services provided, such as restaurants, pizza delivery services, taxi firms, coin-operated machines or car washes. Some money launderers run or use cash-based businesses to commingle illegally obtained funds with cash actually generated by the business. Cash Collateralized Loans - CORRECT ANSWER A cash collateralized loan has cash deposits as the loan's collateral. The cash deposits can sometimes reside in another jurisdiction. Cash Deposits - CORRECT ANSWER Sums of currency deposited in one or more accounts at a financial institution.Vulnerable to money laundering in the "placement phase," as criminals move their cash into the non-cash economy by making deposits into accounts at financial institutions. Cashier's Check - CORRECT ANSWER Common monetary instrument often purchased with cash. Can be used for laundering purposes, cashier's checks provide an instrument drawn on a financial institution. Collection Accounts - CORRECT ANSWER Immigrants from foreign countries deposit many small amounts of currency into one account where they reside, and the collected sum is transferred to an account in their home country without documentation of the sources of the funds. Certain ethnic groups from Asia or Africa may use these to launder money. Commission Rogatoire - CORRECT ANSWER Also known as letters rogatory, a commission rogatoire is a written request for legal or judicial assistance sent by the central authority of one country to the central authority of another when seeking evidence from the foreign jurisdiction. The letter typically specifies the nature of the request, the relevant criminal charges in the requesting country, the legal provision under which the request is made, and the information sought. Concentration Account - CORRECT ANSWER Also called an "omnibus account." Held by a financial institution in its name, a clearing account is used primarily for internal administrative or bank-to-bank transactions in which funds are transmitted and commingled without personally identifying the originators. Concentration Risk - CORRECT ANSWER Primarily applies to the asset side of the balance sheet. As a common practice, supervisory authorities not only require financial institutions to have information systems to identify credit concentrations, but also set limits to restrict bank exposure to single borrowers or groups of related borrowers. On the liability side, it is associated with funding risk, especially the risk of early and sudden withdrawal of funds by large depositors that could harm an institution's liquidity. Confidentiality - CORRECT ANSWER Keeping certain facts, data and information out of public or unauthorized view. In most jurisdictions, confidentiality is required when filing suspicious transaction or activity reports — the filing institution's employees cannot notify a customer that a report has been filed. In another context, a breach of it can occur when an institution discloses client information to enforcement agencies or a financial intelligence unit in violation of the jurisdiction's bank secrecy laws. Confiscation - CORRECT ANSWER Includes forfeiture where applicable, and means the permanent deprivation of funds or other assets by order of a competent authority or a court. It takes place through a judicial or administrative procedure that transfers the ownership of specified funds or other assets to the state. Upon transfer, the person(s) or entity (ies) that held an interest in the specified funds or other assets at the time of the confiscation or forfeiture lose all rights, in principle, to the confiscated or forfeited assets. Corporate Vehicles - CORRECT ANSWER Types of legal entities that may be subject to misuse such as private limited companies and public limited companies whose shares are not traded on a stock exchange, trusts, non-profit organizations, limited partnerships and limited liability partnerships, and private investment companies. Occasionally, it is difficult to identify the persons who are the ultimate beneficial owners and controllers of corporate vehicles, which makes the vehicles vulnerable to money laundering. Correspondent Banking - CORRECT ANSWER The provision of banking services by one bank (the "correspondent bank") to another bank (the "respondent bank").Large international banks typically act as correspondents for hundreds of other banks around the world. Respondent banks may be provided with a wide range of services, including cash management (e.g., interest-bearing accounts in a variety of currencies), international wire transfers of funds, check clearing services, payable-through accounts and foreign exchange services. Credit Cards - CORRECT ANSWER A plastic card with a credit limit used to purchase goods and services and to obtain cash advances on credit. The cardholder is subsequently billed by the issuer for repayment of the credit extended. They may be used to launder money when payments of the amounts owed on the card are made with criminal money. Criminal Proceeds - CORRECT ANSWER Any property derived from or obtained, directly or indirectly, through the commission of a crime. Cross Border - CORRECT ANSWER Used in the context of activities that involve at least two countries, such as wiring money from one country to another or taking currency across a border. Currency - CORRECT ANSWER Banknotes and coins that are in circulation as a medium of exchange. Currency Smuggling - CORRECT ANSWER The illicit movement of large quantities of cash across borders, often into countries without strict banking secrecy, poor exchange controls or poor anti-money laundering legislation. Currency Transaction Report - CORRECT ANSWER A report that documents a physical currency transaction that exceeds a certain monetary threshold. A CTR can also be filed on multiple currency transactions that occur in one day exceed the required reporting amount. Some countries, including the U.S., have requirements addressing when CTRs should be filed with government authorities. Custodian - CORRECT ANSWER A bank, financial institution, or other entity that is responsible for managing, administering, or safekeeping assets for other persons or institutions. A custodian holds assets to minimize risk of theft or loss, and does not actively trade or handle the assets. Custody - CORRECT ANSWER The act of or authority to safeguard and administer clients' investments or assets. Customer Due Diligence - CORRECT ANSWER Policies, practices and procedures that enable a financial institution to predict with relative certainty the types of transactions in which the customer is likely to engage. It includes not only establishing the identity of customers, but also establishing a baseline of account activity to identify those transactions that do not conform to normal or expected transactions. Debit Card - CORRECT ANSWER A card that permits an account holder to draw funds from an existing account. They are used to pay obligations or make purchases. These cards can be used in a variety of places, including on the internet. They often allow for movement of cash via cash-back transactions or withdrawals at ATMs. Designated Categories of Offense - CORRECT ANSWER Those crimes considered by FATF to be money-laundering predicate offenses. Each country can separately decide how it will define specific offenses and their elements under its own domestic laws. Many nations do not specify which crimes can serve as predicates for laundering prosecutions and merely state that all serious felonies may be predicates. Designated Non-Financial Businesses and Professions - CORRECT ANSWER FATF recommends certain standards apply to these entities, including specifically: • Casinos (including Internet casinos). • Real estate agents. • Dealers in precious metals and precious stones. • Lawyers, notaries, other independent legal professionals and accountants. (Note that this refers to those who prepare or carry out certain duties on behalf of clients.) • Trust and company service providers who prepare or carry out certain duties on behalf of their clients Domestic Transfer - CORRECT ANSWER Electronic funds transfer in which the originator and beneficiary institutions are located in the same jurisdiction.It therefore refers to any chain of wire transfers that takes place entirely within the borders of a single jurisdiction, even though the actual system used to send the wire transfer may be located in another jurisdiction or online Eastern and Southern African Anti-Money Laundering Group (ESAAMLG) - CORRECT ANSWER A FATF-style regional body comprising countries from the Eastern region of Africa down to the Southern tip of Africa, established in 1999. Egmont Group of Financial Intelligence Units - CORRECT ANSWER Consists of a numerous national of financial intelligence units (FIUs) that meet regularly to find ways to promote the development of FIUs and to cooperate, especially in the area of information exchange, training and the sharing of expertise. The goal of the group is to provide a forum for FIUs to improve cooperation in the fight against money laundering and the financing of terrorism, and to foster the implementation of domestic programs in this field. Electronic Funds Transfer (EFT) - CORRECT ANSWER The movement of funds between financial institutions electronically. The two most common systems in the U.S. are FedWire and CHIPS. (SWIFT is often referred to as the third system, but in reality it is an international messaging system that carries instructions for wire transfers between institutions, rather than the wire transfer system itself.) Electronic Money (E-Money) - CORRECT ANSWER Represents a series of monetary value units in some electronic format, such as being stored electronically online, on the hard drive of a device, or on the microchip of a plastic card. Enhanced Due Diligence - CORRECT ANSWER In conjunction with Customer Due Diligence, it calls for additional measures aimed at identifying and mitigating the risk posed by higher risk customers. It requires developing a more thorough knowledge of the nature of the customer, the customer's business and understanding of the transactions in the account than a standard or lower risk customer. A financial institution should ensure account profiles are current and monitoring should be risk-based. Eurasian Group on Combating Money Laundering and Financing of Terrorism (EAG) - CORRECT ANSWER A FATF-style regional body formed in October 2004 in Moscow. European Union - CORRECT ANSWER A politico-economic union of member states located primarily in Europe. Member states have set up three common institutions (the European Parliament, the European Commission, and the Council of the European Union) to which they delegate part of their sovereignty so that decisions on specific matters of collective interest can be made democratically at the European level. As a result, people, goods, services and money flow freely through the EU. European Union Directive on Prevention of the Use of the Financial System for the Purpose of Money Laundering and Terrorist Financing - CORRECT ANSWER Directive which requires EU member states to ensure that money laundering and terrorist financing are prohibited.The Directive applies to a broad spectrum of entities, including financial institutions, accountants, notaries, trust companies, estate agents, and some providers of gambling services. Member states are expected to identify and mitigate risks appropriately. They are to oversee financial institutions and other obliged entities, including establishing standards for customer due diligence; prohibition of shell banking relationships; establishing FIUs; developing standards for document retention; and requiring consequences for failure to comply. Europol - CORRECT ANSWER The EU's law enforcement agency. Its main goal is to help achieve a safer Europe for the benefit of all EU citizens. In the area of anti-money laundering, it provides member states' law enforcement authorities with operational and analytical support via the ELOs (Europol Liaison Officers) and its analysts, as well as state of the art databases and communication channels. Express Trust - CORRECT ANSWER A trust created expressly by the settlor, usually in the form of a document such as a written deed of trust. It differs from trusts that do not result from the specific intent or decision of a settlor to create a trust (e.g., constructive trust established by a court of law to address undeclared property). Extradition - CORRECT ANSWER The surrender by one jurisdiction to another of an accused or convicted person under an agreement that specifies the terms of such exchanges. Extraterritorial Reach - CORRECT ANSWER The extension of one country's policies and laws to the citizens and institutions of another. Depending on jurisdiction, money laundering laws may extend prohibitions and sanctions into other jurisdictions. Financial Action Task Force - CORRECT ANSWER Chartered in 1989 by the Group of Seven industrial nations to foster the establishment of national and global measures to combat money laundering. It is an international policy-making body that sets anti-money laundering standards and counter-terrorist financing measures worldwide. Its Recommendations do not have the force of law. Thirty-five countries and two international organizations are members Financial Action Task Force on Money Laundering in Latin America (GAFILAT) - CORRECT ANSWER A FATF-style regional body for Latin America, established in 2000. Financial Action Task Force-Style Regional Body (FSRB) - CORRECT ANSWER Forms and functions similar to those of FATF. However, their efforts are targeted to specific regions. In conjunction with FATF, FSRBs constitute an affiliated global network to combat money laundering and terrorist financing. Financial Intelligence Unit (FIU) - CORRECT ANSWER A central national agency responsible for receiving, analyzing, and transmitting disclosures on suspicious transactions to appropriate authorities. Forfeiture - CORRECT ANSWER The involuntary loss of property or assets as a result of legal action. Generally, the owner of the property has failed to comply with the law or the property is linked to some sort of criminal activity. Freeze - CORRECT ANSWER To prevent or restrict the exchange, withdrawal, liquidation, or use of assets or bank accounts. Unlike forfeiture, frozen property, equipment, funds or other assets remain the property of the natural or legal person(s) that held an interest in them at the time of the freezing and may continue to be administered by third parties. The courts may decide to implement a freeze as a means to protect against flight. Front Company - CORRECT ANSWER Any business set up and controlled by another organization. While not necessarily illicit, criminals use front companies to launder money by giving the funds the appearance of legitimate origin. They may subsidize products and services at levels well below market rates or even below manufacturing costs. Gatekeepers - CORRECT ANSWER Professionals such as lawyers, notaries, accountants, investment advisors, and trust and company service providers who assist in transactions involving the movement of money, and are deemed to have a particular role in identifying, preventing and reporting money laundering. Some countries impose due diligence requirements on gatekeepers that are similar to those of financial institutions. Grantor - CORRECT ANSWER The party who transfers title or ownership of property or assets. In a trust, typically the person who creates or funds the trust. Gulf Cooperation Council - CORRECT ANSWER Formed in 1981, the GCC promotes cooperation between its member states in the fields of economy and industry. Member states include Kuwait, Bahrain, Qatar, Saudi Arabia, Oman and the United Arab Emirates. The GCC is a member of FATF, although its individual members are not. Hawala - CORRECT ANSWER An informal value transfer system common in the Middle East, North Africa, and the Indian sub-continent. The system operates outside traditional banking systems. In a basic form, a customer contacts a hawaladar and gives him money to be transferred to another person. The hawaladar contacts his counterpart where the second person lives, who remits the funds to that person. A running tally is kept between the hawaladars of which owes the other a net sum. Hawaladar - CORRECT ANSWER A Hawala broker Human Smuggling - CORRECT ANSWER Refers to the transport or illegal entry of a person across international borders in contravention of one or more countries' laws. It differs from human trafficking in that it focuses on the entry or transport, rather than the exploitation of the person involved. Human Trafficking - CORRECT ANSWER Also known as Trafficking in Persons. The trade of humans, most commonly for the purpose of sexual slavery, forced labor or commercial sexual exploitation. It occurs in almost every country in the world, and is often cited as the second largest criminal enterprise in the world. Integration - CORRECT ANSWER Often referred to as the third and last stage of the classic money laundering process, places laundered funds back into the economy by re-entering the funds into the financial system and giving them the appearance of legitimacy. International Business Company - CORRECT ANSWER A variety of offshore corporate structures, which are dedicated to business use outside the incorporating jurisdiction and feature rapid formation, secrecy, broad powers, low cost, low to zero taxation and minimal filing and reporting requirements. International Monetary Fund - CORRECT ANSWER An organization of more than 180 member countries, the body works to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world. The organization's objectives have remained unchanged since it was established. Its operations, which involve surveillance, financial assistance and technical support, have adjusted to meet the changing needs of member countries. Knowledge - CORRECT ANSWER Mental state accompanying a prohibited act. The Interpretive Notes to Recommendation 3 of the FATF 40 Recommendations of 2012 says that countries should ensure that the intent and knowledge required to prove the offense of money laundering is consistent with the standards set forth in the Vienna and Palermo Conventions, including the concept that such a mental state may be inferred from objective factual circumstances. It may be deemed, under certain circumstances, to include willful blindness; that is "the deliberate avoidance of knowledge of the facts," as some courts have defined the term. Know Your Customer - CORRECT ANSWER Anti-money laundering policies and procedures used to determine the true identity of a customer and the type of activity that is "normal and expected," and to detect activity that is "unusual" for a particular customer. Know Your Employee - CORRECT ANSWER Anti-money laundering policies and procedures for acquiring a better knowledge and understanding of the employees of an institution for the purpose of detecting conflicts of interests, money laundering, past criminal activity and suspicious activity. Layering - CORRECT ANSWER The second phase of the classic three-step money laundering process between placement and integration, it involves distancing illegal proceeds from their source by creating complex levels of financial transactions designed to disguise the audit trail and to provide anonymity. Legal Risk - CORRECT ANSWER Defined by the 2001 Basel Customer Due Diligence for Banks Paper as the possibility that lawsuits, adverse judgments or contracts that cannot be enforced may disrupt or harm a financial institution. In addition, banks can suffer administrative or criminal penalties imposed by the government. A court case involving a bank may have graver implications for the institution than just the legal costs. Banks will be unable to protect themselves effectively from such legal risks if they do not practice due diligence in identifying customers and understanding and managing their exposure to money laundering. Memorandum of Understanding (MOU) - CORRECT ANSWER Agreement between two parties establishing a set of principles that govern their relationship on a particular matter. It is often used by countries to govern their sharing of assets in international asset-forfeiture cases or to set out their respective duties in anti-money laundering initiatives. Financial Intelligence Units (FIUs), with the task of receiving and analyzing suspicious transaction reports on an ongoing basis and maintaining close links with police and customs authorities, share information among themselves informally in the context of investigations, usually on this basis. Middle East and North Africa Financial Action Task Force (MENAFATF) - CORRECT ANSWER FATF-style body established for the Middle Eastern and North African regions in 2004. Monetary Instruments - CORRECT ANSWER Travelers checks, negotiable instruments, including personal checks and business checks, official bank checks, cashier's checks, promissory notes, money orders, securities or stocks in bearer form. They are normally included, along with currency, in the antimoney laundering regulations of most countries, and financial institutions must file reports and maintain records of customer activities involving them. Money Laundering - CORRECT ANSWER The process of concealing or disguising the existence, source, movement, destination or illegal application of illicitly- derived property or funds to make them appear legitimate. It usually involves a three part system: placement of funds into a financial system, layering of transactions to disguise the source, ownership and location of the funds, and integration of the funds into society in the form of holdings that appear legitimate. The definition of money laundering varies in each country where it is recognized as a crime. Money Laundering Reporting Officer (MLRO) - CORRECT ANSWER A term used in various international rules to refer to the person responsible for overseeing a firm's anti-money laundering activities and program and for filing reports of suspicious transactions with the national FIU. HE/She is the key person in the implementation of anti-money laundering strategies and policies. Money Order - CORRECT ANSWER A monetary instrument usually purchased with cash in small (generally under Euro/$500) denominations. It is commonly used by people without checking accounts to pay bills or to pay for purchases in which the vendor will not accept a personal check. They may be used for laundering because they represent an instrument drawn on the issuing institution rather than on an individual's account. Money Services Business (MSB) - CORRECT ANSWER A person (whether a natural or legal person) engaged in any of the following activities where it exceeds the applicable regulatory threshold, at which point the person is generally deemed to be a financial institution subject to AML obligations: • Dealing in foreign exchange • Check cashing • Issuing or selling traveler's checks or money orders • Providing or selling prepaid access • Money transmission Money Transfer Service or Value Transfer Service - CORRECT ANSWER Financial service that accepts cash, checks and other monetary instruments that can store value in one location and pay a corresponding sum in cash or other form to a beneficiary in another location by means of a communication, message, transfer or through a clearing network to which the money/ value transfer service belongs. Transactions performed by such services can involve one or more intermediaries and a third-party final payment. It may be provided by persons (natural or legal) formally through the regulated financial system (for example, bank accounts), informally through non-bank financial institutions and business entities or outside of the regulated system. In some jurisdictions, informal systems are referred to as alternative remittance services or underground (or parallel) banking systems. MONEYVAL - CORRECT ANSWER Council of Europe Select Committee of Experts on the Evaluation of Anti-Money Laundering Measures. Formerly PC- R-EV, the committee was established in 1997 by the Committee of Ministers of the Council of Europe to conduct self and mutual assessments of anti-money laundering measures in place in Council of Europe countries that are not FATF members. It is a sub-committee of the European Committee on Crime Problems of the Council of Europe (CDPC). Monitoring - CORRECT ANSWER An element of an institution's anti-money laundering program in which customer activity is reviewed for unusual or suspicious patterns, trends or outlying transactions that do not fit a normal pattern. Transactions are often monitored using software that weighs the activity against a threshold of what is deemed "normal and expected" for the customer Mutual Legal Assistance Treaty (MLAT) - CORRECT ANSWER Agreement among countries allowing for mutual assistance in legal proceedings and access to documents and witnesses and other legal and judicial resources in the respective countries, in private and public sectors, for use in official investigations and prosecutions. Nesting - CORRECT ANSWER The practice where a respondent bank provides downstream correspondent services to other financial institutions and processes these transactions through its own correspondent account. The correspondent bank is thus processing transactions for financial institutions on which it has not conducted due diligence. While this is a normal part of correspondent banking, it requires the correspondent bank to conduct enhanced due diligence on its respondent's AML program to adequately mitigate the risk of processing the customer's customers' transactions. Non-Governmental Organization (NGO) - CORRECT ANSWER Not for profit organizations that are not directly linked to the governments of specific countries, and perform a variety of service and humanitarian functions, including bringing citizen concerns to governments, advocating for causes and encouraging political participation. Some countries' anti- money laundering regulations for NGOs still have loopholes that some worry could be exploited by terrorists or terrorist sympathizers trying to secretly move money. - CORRECT ANSWER These can take on a variety of forms, depending on the jurisdiction and legal system, including associations, foundations, fund-raising committees, community service organizations, corporations of public interest, limited companies and public benevolent institutions. FATF has suggested practices to help authorities protect organizations that raise or disburse funds for charitable, religious, cultural, educational, social or fraternal purposes from being misused or exploited by financiers of terrorism Offshore - CORRECT ANSWER Literally, away from one's own home country—if one lives in Europe, the U.S. is "offshore." In the money laundering lexicon, the term refers to jurisdictions deemed favorable to foreign investments because of low or no taxation or strict bank secrecy regulations. Offshore Banking License - CORRECT ANSWER A license that prohibits a bank from doing business with local citizens or in local currency as a condition of its license. Offshore Financial Center (OFC) - CORRECT ANSWER Institutions that cater to or otherwise encourage banks, trading companies, and other corporate or legal entities to physically or legally exist in a jurisdiction but limit their operations to "offshore," meaning outside the jurisdiction (see Offshore). OFCs have historically been located in the Caribbean or on Mediterranean islands to be in reasonable proximity to the major financial centers of the U.S. and Europe. Omnibus Account - CORRECT ANSWER Also known as a clearing account. Operational Risk - CORRECT ANSWER The risk of direct or indirect loss of operations due to inadequate or failed internal processes, people or systems, or as a result of external events. Public perception that a bank is not able to manage its operational risk effectively can disrupt or harm the business of the bank. Organization for Economic Cooperation and Development (OECD) - CORRECT ANSWER International organization that assists governments on economic development issues in the global economy. OECD houses the FATF secretariat in Paris. Originator - CORRECT ANSWER The account holder or, where there is no account, the person (natural or legal) which places the order with the financial institution to perform the wire transfer. Payable Through Account - CORRECT ANSWER Transaction account opened at a depository institution by a foreign financial institution through which the foreign institution's customers engage, either directly or through subaccounts, in banking activities and transactions in such a manner that the financial institution's customers have direct control over the funds in the account. These accounts pose risks to the depository institutions that hold them because it can be difficult to conduct due diligence on foreign institution customers who are ultimately using the PTA accounts. Physical Presence - CORRECT ANSWER Existence of an actual brick and mortar location with meaningful management of the institution physically located within a country, where it maintains business records and is subject to supervision. The mere existence of a local agent or low level staff does not constitute physical presence. Placement - CORRECT ANSWER The first phase of the money laundering process: The physical disposal of proceeds derived from illegal activity. Politically Exposed Person - CORRECT ANSWER An individual who has been entrusted with prominent public functions in a foreign country, such as a head of state, senior politician, senior government official, judicial or military official, senior executive of a state-owned corporation or important political party official, as well as their families and close associates. Ponzi Scheme - CORRECT ANSWER A money laundering system named after Charles Ponzi, an Italian immigrant who spent 10 years in jail in the U.S. for a scheme that defrauded 40,000 people out of $15,000,000. Ponzi's name became synonymous with the use of new investors' money to pay off prior investors. Ponzi schemes involve fake, non-existent investment schemes in which the investors are tricked into investing on the promise of unusually attractive returns. The operator of the scheme can keep the operation going by paying off early investors with the money from new investors until the scheme collapses under its own weight and/or the promoter vanishes with the remaining money. Predicate Crimes - CORRECT ANSWER "Specified unlawful activities" whose proceeds, if involved in the subject transaction, can give rise to prosecution for money laundering. Most anti-money laundering laws contain a wide definition or listing of such underlying crimes. Sometimes defined as felonies or all offenses in the criminal code. Private Banking - CORRECT ANSWER A department in a financial institution that provides high-end services to wealthy individuals. The transactions tend to be marked with confidentiality, complex beneficial ownership arrangements, offshore investment vehicles, tax shelters and credit extension services. Private Investment Company - CORRECT ANSWER Personal Investment Company, a PIC is a type of corporation that is often established in an offshore jurisdiction with tight secrecy laws to protect the privacy of its owners. In some jurisdictions, an international business company or exempt company is referred to as a private investment company. Pyramid Scheme - CORRECT ANSWER A type of fraud, of which a ponzi scheme is a subset. Red Flag - CORRECT ANSWER A warning signal that should bring attention to a potentially suspicious situation, transaction or activity. Regulatory Agency - CORRECT ANSWER A government entity responsible for supervising and overseeing one or more categories of financial institutions. The agency generally has authority to issue regulations, to conduct examinations, to impose fines and penalties, to curtail activities and, sometimes, to terminate charters of institutions under its jurisdiction. Most play a major role in preventing and detecting money laundering and other financial crimes. Their focus is usually on domestic institutions, but some have the ability to regulate foreign branches and operations of institutions. Remittance Services - CORRECT ANSWER Also referred to as giro houses or casas de cambio, remittance services are businesses that receive cash or other funds that they transfer through the banking system to another account. The account is held by an associated company in a foreign jurisdiction where the money is made available to the ultimate recipient. Reputational Risk - CORRECT ANSWER The potential that adverse publicity regarding a financial institution's business practices and associations, whether accurate or not, will cause a loss of confidence in the integrity of the institution. Banks and other financial institutions are especially vulnerable to this type of risk because they can become a vehicle for, or a victim of, illegal activities perpetrated by customers. Such institutions may protect themselves through Know Your Customer and Know Your Employee programs. Respondent Bank - CORRECT ANSWER A bank for which another financial institution establishes, maintains, administers or manages a correspondent account. Risk-Based Approach - CORRECT ANSWER The assessment of the varying risks associated with different types of businesses, clients, accounts and transactions in order to maximize the effectiveness of an anti-money laundering program. Safe Harbor - CORRECT ANSWER Legal protection for financial institutions, their directors, officers and employees from criminal and civil liability for breach of any restriction on disclosing information imposed by contract or by any legislative, regulatory or administrative prohibition, if they report their suspicions in good faith to the Financial Investigation Unit (FIU), even if they did not know precisely what the underlying criminal activity was, and regardless of whether illegal activity actually occurred. Seize - CORRECT ANSWER To prohibit the transfer, conversion, disposition or movement of funds or other assets on the basis of an action initiated by a competent authority or a court under a freezing mechanism. However, unlike a freeze, a seizure allows the competent authority to take control of specified funds or other assets. The seized assets remain the property of the person(s) or entity(ies) that held an interest in them at the time of the seizure, although the competent authority will often take over possession, administration or management of the seized assets. Senior Foreign Political Figure - CORRECT ANSWER U.S. term for foreign politically exposed persons. Settlors - CORRECT ANSWER Persons or companies who transfer ownership of their assets to trustees by means of a trust deed. Where the trustees have some discretion as to the investment and distribution of the trust's assets, the deed may be accompanied by a non-legally binding letter setting out what the settlor wishes done with the assets. Shell Bank - CORRECT ANSWER Bank that exists on paper only and that has no physical presence in the country where it is incorporated or licensed, and which is unaffiliated with a regulated financial services group that is subject to effective consolidated supervision. Smurfing - CORRECT ANSWER A commonly used money laundering method, smurfing involves the use of multiple individuals and/or multiple transactions for making cash deposits, buying monetary instruments or bank drafts in amounts under the reporting threshold. The individuals hired to conduct the transactions are referred to as "smurfs." Sting Operation - CORRECT ANSWER Investigative tactic in which undercover officers pose as criminals, sometimes through a "front" business, to win the confidence of suspected or known criminals to gather information and to obtain evidence of criminal conduct. It is an effective means of identifying criminals, penetrating criminal organizations and identifying tainted property in money laundering and other cases. Structuring - CORRECT ANSWER Illegal act of splitting cash deposits or withdrawals into smaller amounts, or purchasing monetary instruments, to stay under a currency reporting threshold. The practice might involve dividing a sum of money into lesser quantities and making two or more deposits or withdrawals that add up to the original amount. Money launderers use this to avoid triggering a filing by a financial institution. The technique is common in jurisdictions that have compulsory currency reporting requirements. Subpoena - CORRECT ANSWER Compulsory legal process issued by a court to compel the appearance of a witness at a judicial proceeding, sometimes requiring the witness to bring specified documents. The term can refer to either the process or the actual document that compels the recipient to act. Suspicious Activity - CORRECT ANSWER Irregular or questionable customer behavior or activity that may be related to a money laundering or other criminal offense, or to the financing of a terrorist activity. May also refer to a transaction that is inconsistent with a customer's known legitimate business, personal activities, or the normal level of activity for that kind of business or account. Suspicious Transaction Report (STR) - CORRECT ANSWER A government filing required by reporting entities that includes a financial institution's account of a questionable transaction. Tax Haven - CORRECT ANSWER Countries that offer special tax incentives or tax avoidance to foreign investors and depositors. Terrorist Financing - CORRECT ANSWER The process by which terrorists fund their operations in order to perform terrorist acts. There are two primary sources of financing for terrorist activities. The first involves financial support from countries, organizations or individuals. The other involves a wide variety of revenue-generating activities, some illicit, including smuggling and credit card fraud. Testimony - CORRECT ANSWER Witness' oral presentation, usually under oath, that describes facts known to the witness. Tipping Off - CORRECT ANSWER Improper or illegal act of notifying a suspect that he or she is the subject of a Suspicious Transaction Report or is otherwise being investigated or pursued by the authorities. Transparency International - CORRECT ANSWER Berlin-based, non-governmental organization dedicated to increasing government accountability and curbing both international and national corruption. Established in 1993, TI is active in approximately 100 countries. It publishes "corruption news" on its website daily and offers an archive of corruption- related news articles and reports. Its Corruption Online Research and Information System, or CORIS, is perhaps the most comprehensive worldwide database on corruption. Trust - CORRECT ANSWER Arrangement among the property owner (the grantor), a beneficiary and a manager of the property (the trustee), whereby the trustee manages the property for the benefit of the beneficiary in accordance with terms set by the grantor. Trustee - CORRECT ANSWER May be a paid professional or company or unpaid person that holds the assets in a trust fund separate from the trustee's own assets. The trustee invests and disposes of the assets in accordance with the settlor's trust deed, taking into consideration any letter of wishes. United Nations - CORRECT ANSWER An international organization that was established in 1945 by 51 countries committed to preserving peace through cooperation and collective security. Today, nearly every nation in the world belongs to the UN. The United Nations contributes to the fight against organized crime with initiatives such as the Global Program against Money Laundering (GPML), the key instrument of the UN Office of Drug Control and Crime Prevention in this task. Through the GPML, the UN helps member states to introduce legislation against money laundering and to develop mechanisms to combat this crime. The program encourages anti-money laundering policy development, monitors and analyzes the problems and responses, raises public awareness about money laundering and acts as a coordinator of joint anti-money laundering initiatives with other international organizations. UN Security Council Resolution 1373 - CORRECT ANSWER Adopted in 2001, the resolution requires member nations to take a series of actions to combat terrorism through the adoption of laws and regulations and the establishment of administrative structures. The resolution also requires member nations to "afford one another the greatest measure of assistance for criminal investigations or criminal proceedings relating to the financing or support of terrorist acts." Unusual Transaction - CORRECT ANSWER Transaction that appears designed to circumvent reporting requirements, is inconsistent with the account's transaction patterns or deviates from the activity expected for that type of account. USA Patriot Act - CORRECT ANSWER The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56). Enacted on October 26, 2001, the historic U.S. law brought about momentous changes in the anti-money laundering field, including more than 50 amendments to the Bank Secrecy Act. Vienna Convention - CORRECT ANSWER Convention in 1988 against the Illicit Trade in Narcotic Drugs and Psychotropic Substances. Countries that become parties to the Convention commit to criminalizing drug trafficking and associated money laundering, and enacting measures for the confiscation of the proceeds of drug trafficking. Article III of the Convention provides a comprehensive definition of money laundering, which has been the basis of much subsequent national legislation. Willful Blindness - CORRECT ANSWER Legal principle that operates in money laundering cases in the U.S. and is defined by courts as the "deliberate avoidance of knowledge of the facts" or "purposeful indifference." Courts have held that it is the equivalent of actual knowledge of the illegal source of funds or of the intentions of a customer in a money laundering transaction. Wire Transfer - CORRECT ANSWER Electronic transmission of funds among financial institutions on behalf of themselves or their customers. They are financial vehicles covered by the regulatory requirements of many countries in the anti-money laundering effort. Wolfsberg Group - CORRECT ANSWER Named after the castle in Switzerland where its first working session was held, the Wolfsberg Group is an association of global financial institutions, including Banco Santander, Bank of America, Bank of Tokyo-Mitsubishi UFJ, Barclays, Citigroup, Credit Suisse Group, Deutsche Bank, Goldman Sachs, HSBC, J.P. Morgan Chase, Société Générale, Standard Chartered Bank and UBS. In 2000, along with Transparency International and experts worldwide, the institutions developed global anti-money laundering guidelines for international private banks. Since then, it has issued several other guidelines on correspondent banking and terrorist financing, among others. World Bank - CORRECT ANSWER The World Bank is a vital source of financial and technical assistance to developing countries. It is not a bank in the usual sense, but is made up of two unique development institutions owned by 184 member countries—the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA). Both organizations provide low-interest loans, interest-free credit, and grants to developing countries Yates Memo - CORRECT ANSWER Issued by then-Deputy Attorney General Sally Yates of the Department of Justice. It reminds prosecutors that criminal and civil investigations into corporate misconduct should also focus on individuals who perpetrated the wrongdoing. Remote Deposit Capture - CORRECT ANSWER A product offered by banks that allows customers to scan a check and transmit an electronic image to the bank for deposit. The risk associated with it is that it enables a money launderer to deposit checks without having to visit the bank and risk detection.