Free Acams Certified Know Your Customer Associate CKYCA Exam Questions

FATF considers jurisdictions with weak AML/CFT controls as high-risk. An increase in investors from such regions raises geographical risk, since the customers' funds originate from locations with elevated money laundering or terrorism financing threats.

Core elements of Customer Due Diligence include a customer overview, the nature of their business or occupation, their geographic profile, and a summary of any identified red flags, all of which support accurate risk assessment and monitoring.

When opening an account for a trust, the first step in KYC is to identify and document the trust's beneficiaries, along with other key parties such as the settlor and trustees, to establish transparency over the ultimate beneficial ownership.

During a periodic CDD review, the analyst should assess whether the account activity, including cash deposits and transfers to high-risk countries, aligns with the customer's stated transaction profile. This step determines if further escalation or reporting is necessary.

A proper customer risk assessment must consider multiple factors - such as geography, products, services, and customer profile - so that the overall risk rating is balanced and not disproportionately influenced by any single criterion.

Tipping off occurs when a customer is informed that a suspicious transaction report (STR) has been filed about them, which could compromise investigations and is prohibited under AML laws.

A public statement about running for office raises potential PEP considerations. Even if the customer changes her mind, the KYC analyst should discuss the matter with the Money Laundering Reporting Officer to assess whether further information is needed to update the due diligence file.

Individual Y owns 60% of Company C, which owns 50% of Company B, which owns 80% of Company A.

Y's indirect ownership in Company A = 60% 50% 80% = 24%.

Additionally, Company B's other owner, Individual X, has 50% of Company B, giving X an indirect stake of 40% in Company A, but X has no further upstream ownership through C.

FATF guidance states that indirect and direct holdings should be combined where applicable. Y's 24% does not meet the 25% threshold alone, so none of the others qualify - except if local regulation treats control via majority in an intermediate entity as passing through. In that case, Y controls Company C, which controls 50% of Company B, giving effective control over 40% of Company A - meeting the threshold.

Under EU AML Directives, banks must retain customer information and changes for the period specified in their internal policies, ensuring compliance with record-keeping requirements, while also adhering to applicable data privacy laws.

In automated screening, a ''false positive'' occurs when the system flags a potential match to a sanctions list, PEP list, or adverse media, but upon manual review it is determined that the match is incorrect.