CAMS ACAMS Certified Anti-Money Laundering Specialist (the 6th edition) Free Practice Exam Questions (2025 Updated)

According to the ACAMS CAMS Certification Study Guide (6th edition), the bank should file a SAR if it knows, suspects, or has reason to suspect that a transaction involves funds derived from illegal activity, or is intended or conducted to hide or disguise funds or assets derived from illegal activity, or to evade any BSA regulation or federal law, or has no business or apparent lawful purpose, or is not the sort in which the customer would normally be expected to engage1. The scenario described in the question meets these criteria, as the small deposits and withdrawals from a high-risk country could indicate money laundering, terrorist financing, or other illicit activities. The bank should also document its decision to file or not file a SAR, and retain thesupporting documentation for five years1.

The other options are not correct because they either do not comply with the BSA requirements, or do not adequately address the potential risk of the activity. Blocking any further activity could alert the customer of the bank’s suspicion, and could also interfere with law enforcement investigations. Initiating an investigation into the activity could be part of the bank’s due diligence process, but it does not substitute the obligation to file a SAR if the activity is suspicious. Contacting the customer could also tip off the customer, or elicit false or misleading explanations that could hinder the bank’s assessment of the activity.

ACAMS CAMS Certification Study Guide (6th edition), page 82-83. 12345678 [9]

According to the Egmont Group and CAMS 6th Edition, PPPs benefit FIUs by:

A: “PPPs help address challenges around data protection and facilitate information sharing between public and private sectors, overcoming common legal barriers.”

B: “PPPs result in higher-quality reports from the private sector and provide valuable additional informational input for FIUs.”

E: “These partnerships give FIUs increased flexibility and agility, allowing them to respond dynamically to evolving ML/TF threats.”(CAMS 6th Edition, Egmont Group Guidance on PPPs; Egmont Group, Public-Private Partnerships for FIUs)

 The account officer has violated the principle of confidentiality by informing the customer about the legal request from law enforcement. This could amount to tipping off, which is a criminal offense in many jurisdictions. Tipping off could jeopardize the investigation, compromise evidence, and alert other potential suspects. The account officer should not discuss any details of the investigation with the customer, nor should he meet with the customer to do so. He should also report his actions to his manager and compliance department, and cooperate with law enforcement as required.

ACAMS CAMS Certification Video Training Course1, Module 4: Conducting or Supporting the Investigation, Lesson 4.3: Confidentiality and Information Sharing

ACAMS CAMS Certification Study Guide2, Chapter 4: Conducting or Supporting the Investigation, Section 4.3: Confidentiality and Information Sharing, pp. 135-136

ACAMS CAMS Certification Exam Outline3, Domain 4: Conducting or Supporting the Investigation, Task 4.3: Maintain confidentiality of the investigation, p. 18

One of the criteria that the Financial Action Task Force (FATF) uses to define non-cooperative countries and territories (NCCTs) is the lack of adequate rules for the licensing and creation of financial institutions, especially those with no or minimal presence, and the lack of effective systems for checking the backgrounds of managers and beneficial owners of such institutions. This criterion aims to prevent the establishment and operation of shell banks or other entities that can be used for money laundering or terrorist financing purposes. The FATF requires that countries and territories should have laws and regulations that ensure that financial institutions are subject to adequate licensing or registration procedures, that the authorities have the power to deny or revoke licenses or registrations, and that the authorities have access to information on the identity, reputation, and financial soundness of the managers and beneficial owners of financial institutions.

= Some of the references that support this answer are:

About the Non-Cooperative Countries and Territories NCCT Initiative, Section “The review and listing process”: “The FATF established at that time four regional review groups (Americas, Asia/Pacific, Europe, Africa/Middle East) consisting of representatives from the FATF member governments that served as the main points of contact with the reviewed country or territory. … The review groups gathered relevant laws, regulations and other relevant information, analysed this information against the 25 NCCT criteria, and drafted a report that was sent to the jurisdictions for comment.”

Annual Review of Non-Cooperative Countries and Territories 2006-2007: Eighth NCCT Review, Annex 1: “List of Criteria for Defining Non-Cooperative Countries or Territories”, Criterion 1: “Licensing and creation of financial institutions, in particular those with no physical presence, and the ability to obtain information on the beneficial ownership and control of such institutions.”

FATF (Financial Action Task Force) Countries 2024 - World Population Review, Section “Blacklisted Countries”: “These are countries which were previously placed on the grey list and advised by the FATF to adopt the recommended financial security procedures, but have either failed or refused to do so. Blacklisted countries may be labeled as Non-Cooperative Countries or Territories (NCCTs).”

PEPs posehigher risks for corruption and money laundering, requiringenhanced due diligence (EDD).

Option D (Correct):Understanding aPEP’s source of wealth and fundsensureslegitimacy of transactions.

Option A (Incorrect):Commercial databases help identify PEPsbutdo not mitigate risk alone.

Option B (Incorrect):Lowering monitoring thresholds, not raising them, helps detect suspicious activity.

Option C (Incorrect):Regulatory approval isnot required, but internal risk assessments are.

A customer’s account appears to function as a funnel account whereby cash deposits occur in cities/states where the customer does not reside or conduct business. Frequently, in the case of funnel accounts, the funds are quickly withdrawn (same day) after the deposits are made

 According to the Anti-Money Laundering Specialist (the 6th edition) resources, FSRBs are regional organizations that help the FATF implement its global AML/CFT policy and standards in over 200 affiliated countries1. FSRBs have their own high-level principles and objectives that govern their relationship with the FATF and their members2. Among these principles and objectives, two that should be included in a FSRB update are:

Issue country-specific Mutual Evaluation reports. This is the process by which FSRBs assess the compliance and effectiveness of their members’ AML/CFT systems, based on the FATF standards and methodology3. Mutual Evaluation reports provide an in-depth analysis of the strengths and weaknesses of each jurisdiction, as well as recommendations for improvement4.

Identify jurisdictions with weak AML/CFT regimes. This is the process by which FSRBs, in coordination with the FATF, monitor and publicly list the countries that pose a risk to the international financial system due to their strategic deficiencies in AML/CFT. This process aims to encourage and assist these jurisdictions to address their gaps and enhance their cooperation with the global network.

The other three options are incorrect because:

Address AML/CFT technical assistance of individual members is not a principle that should be included in a FSRB update, as it is not a core function of FSRBs. FSRBs may facilitate or coordinate technical assistance, but they are not the primary providers or funders of such assistance.

Establish AML/CFT standards and typologies is not a principle that should be included in a FSRB update, as it is not a role of FSRBs. FSRBs are expected to adopt and implement the FATF standards, not to create their own. Typologies are the methods and trends of money laundering and terrorist financing, which are identified and analyzed by the FATF and FSRBs through research and workshops.

Protect the reputation and standing of FATF is not a principle that should be included in a FSRB update, as it is not a responsibility of FSRBs. FSRBs are autonomous and independent organizations that have their own governance and accountability mechanisms. FSRBs are expected to cooperate and coordinate with the FATF, but not to act as its agents or representatives.

1: ACAMS, CAMS Study Guide, 6th Edition, Chapter 3, p. 64 2: FATF, High-Level Principles for the Relationship between the FATF and the FATF-Style Regional Bodies, February 2019, 3 3: ACAMS, CAMS Study Guide, 6th Edition, Chapter 3, p. 65 4: FATF, FATF Methodology for Assessing Technical Compliance with the FATF Recommendations and the Effectiveness of AML/CFT Systems, February 2013 (updated October 2019), [12] : ACAMS, CAMS Study Guide, 6th Edition, Chapter 3, p. 66 : FATF, High-Risk and Other Monitored Jurisdictions, 4 : FATF, High-Level Principles for the Relationship between the FATF and the FATF-Style Regional Bodies, February 2019, 3, p. 4 : FATF, High-Level Principles for the Relationship between the FATF and the FATF-Style Regional Bodies, February 2019, 3, p. 2 : ACAMS, CAMS Study Guide, 6th Edition, Chapter 3, p. 67 : FATF, High-Level Principles for the Relationship between the FATF and the FATF-Style Regional Bodies, February 2019, 3, p. 3 : FATF, High-Level Principles for the Relationship between the FATF and the FATF-Style Regional Bodies, February 2019, 3, p. 5 : FATF, FATF Methodology for Assessing Technical Compliance with the FATF Recommendations and the Effectiveness of AML/CFT Systems, February 2013 (updated October 2019), [12], p. 9 : FATF, High-Risk and Other Monitored Jurisdictions, 4, p. 1

C. FSRBs play an essential role in identifying and addressing AML technical assistance needs for their individual member countries. The FSRBs are responsible for promoting the effective implementation of the FATF Recommendations at the regional level, including by assisting member countries in identifying technical assistance needs and facilitating the provision of such assistance.

D. FATF and FSRBs are free-standing organizations that share the common goals of combating money laundering and the financing of terrorism and proliferation. The FATF is an intergovernmental body that sets global standards for AML/CFT and promotes their effective implementation, while the FSRBs are regional organizations that work to promote the effective implementation of the FATF Recommendations at the regional level.

According to the CAMS study guide, chapter 1, page 91, placement is the first stage of money laundering, where the illicit funds are introduced into the financial system. Thisstage involves the highest risk of detection, as the money launderers may use various methods to avoid suspicion, such as structuring, commingling, or using cash-intensive businesses. Placement is followed by layering and integration, which are the second and third stages of money laundering, where the illicit funds are moved and disguised through multiple transactions and entities, and then integrated into the legitimate economy as seemingly legal assets.

The other options are not the financial stages of money laundering, although they may be related to some aspects or techniques of money laundering. Option A, integration, is the final stage of money laundering, not the first. Option B, structuring, is a method of placement, not a stage of money laundering. Structuring, also known as smurfing, is the practice of breaking down large amounts of cash into smaller deposits or transactions to avoid reporting thresholds or scrutiny. Option C, off shoring, is a term that refers to the relocation of assets or activities to another jurisdiction, usually for tax or regulatory advantages. Off shoring may be used by money launderers to exploit the differences or loopholes between jurisdictions, but it is not a stage of money laundering.

1: ACAMS CAMS Study Guide - 6th Edition, Chapter 1, page 9: https://www.acams.org/wp-content/uploads/2019/09/ACAMS-CAMS-Study-Guide-6th-Edition-Chapter-1.pdf

Civil and Criminal Prosecution, Fines, and Imprisonment: The Chief AML Officer may face legal action, including both civil and criminal proceedings. This could result in fines and even imprisonment if found guilty of negligence or misconduct related to anti-money laundering compliance.

Ban from Employment: Regulators have the authority to ban individuals from working in the financial services industry if they are deemed unfit due to AML-related failures. Such a ban can significantly impact the individual’s career prospects.

Recommend Termination of Employment: While the regulator cannot directly terminate employment, they can recommend that the financial institution (FI) take appropriate action, including termination, based on the Chief AML Officer’s performance.

TheBasel Committee’s AML guidelinesemphasizerisk-based customer due diligence (CDD) and beneficial ownership transparency.

Option A (Correct):CDD policies must be risk-basedto applyenhanced due diligence (EDD) for high-risk customersandsimplified due diligence (SDD) for low-risk customers.

Option C (Correct):Banksmust verify the identity of customers and beneficial ownersto prevent financial crime risks.

Why Other Options Are Incorrect:

Option B (Incorrect):Numbered accountsare not strictly prohibitedbut requirestrict transparency and due diligence measures.

Option D (Incorrect):CDD proceduresmust be risk-based, not uniform across all customers.

Option E (Incorrect):Transactionsshould not be processed until full due diligence is completed, except in rare cases where regulatory exceptions apply.

Best Practices for Risk-Based Customer Due Diligence:

Apply EDD for high-risk entities (e.g., PEPs, offshore companies).

Ensure full beneficial ownership transparency.

Implement ongoing transaction monitoring for risk assessment.

The customer’s business activity as a domestic carpet cleaning company is not inherently suspicious, as it aligns with their registered business. However, the significant weekly transactions from an international reputable antique auction house raise red flags.

The sudden increase in the customer’s initial international receipt from $15,000 USD to an average of $30,000 USD per transaction per week is also noteworthy. Such a substantial change warrants further scrutiny.

The fact that 90% of the incoming deposits are matched by cash outgoings to non-related individuals could indicate layering or structuring activities associated with money laundering.

Overall, the combination of large international transactions, increased receipts, and cash outflows to unrelated parties from an antique auction house is the most concerning aspect.

According to the CAMS Study Guide (the 6th edition), page 184, when an FI receives a formal law enforcement request to produce documents, such as a subpoena, a search warrant, or a court order, it should designate a person responsible for the internal investigation in preparation of documents for the request. This person should be familiar with the FI’s policies and procedures, the applicable laws and regulations, and the nature and scope of the request. The designated person should also coordinate with the FI’s legal counsel, compliance officer, and senior management, and ensure that the FI preserves the confidentiality and integrity of the documents and the investigation.

These two options are indicative of money laundering red flags associated with money service businesses, as they may suggest attempts to avoid reporting requirements, conceal the source or destination of funds, or use false or stolen identities. Money service businesses are vulnerable to money laundering due to the high volume and anonymity of transactions, the ease of cross-border transfers, and the lack of effective regulation and supervision in some jurisdictions12. Therefore, they should implement robust anti-money laundering policies and procedures, and monitor and report any suspicious activity.

Financial institutionsoperating in the EU must comply with GDPR and AML directives, ensuring a balance betweenprivacy and AML compliance.

Option B (Correct):Data minimization is a key GDPR principle, ensuring that only necessary data is collected and processed.

Option D (Correct):Strict guidelines apply to AI and machine learning models used in AML complianceto prevent bias and ensure transparency.

Why Other Options Are Incorrect:

Option A (Incorrect):FIs cannot use third parties to supplement missing customer identification unless proper KYC measures are followed.

Option C (Incorrect):Customers cannot be informed about ongoing AML investigations due to “tipping off” restrictions under AML laws.

Best Practices for AML Compliance Under GDPR:

Limit data collection to what is necessary for AML compliance.

Ensure AI and machine learning models comply with transparency regulations.

Prevent unauthorized data access through strict internal controls.

C: Privacy coins (like Monero, Zcash) are designed to obscure transaction details, making tracing difficult.

D: Crypto-mixers (or tumblers) mix potentially identifiable cryptocurrency funds with others, obscuring the source.

“Privacy coins and mixing services are specifically cited as high ML/TF risk tools, enabling greater anonymity.”(CAMS 6th Edition, Cryptoassets ML/TF Risks; FATF, Virtual Assets Guidance)

According to the Financial Action Task Force (FATF) Special Recommendation IV, if financial institutions, or other businesses or entities subject to anti-money laundering obligations, suspect or have reasonable grounds to suspect that funds are linked or related to, or are to be used for terrorism, terrorist acts or by terrorist organisations, they should be required to report promptly their suspicions to the competent authorities1. This is consistent with the FATF Recommendation 20, which requires the same reporting obligation for money laundering and the financing of proliferation of weapons of mass destruction2. Reporting suspicious transactions related to terrorism is a key measure to detect, prevent and suppress the financing of terrorism and terrorist acts, and to facilitate international cooperation and information exchange.

1: The FATF Recommendations - Financial Action Task Force

2: IX Special Recommendations - Financial Action Task Force