ACAMS Virtual Assets and Cryptocurrency AML 3

Question 1

Which international body is responsible for setting the global AML/CFT standards that now explicitly cover virtual assets and VASPs?

Accepted Answer

The Financial Action Task Force (FATF)

Answer

The Bank for International Settlements (BIS)

Answer

The International Monetary Fund (IMF)

Answer

The Basel Committee on Banking Supervision (BCBS)

Question 2

A VASP receives a large transfer of Bitcoin from a wallet address that blockchain analytics tools flag as associated with a darknet marketplace. What is the compliance officer's most appropriate immediate action?

Accepted Answer

Conduct enhanced due diligence, consider freezing the funds, and evaluate whether to file a SAR

Answer

Return the funds immediately to the originating wallet without further review

Answer

Accept the funds and monitor the account for 90 days before deciding

Answer

Transfer the funds to a segregated account and notify the customer to provide documentation

Question 3

What is 'transaction monitoring' in the context of a VASP's AML program, and what makes it uniquely challenging compared to traditional banking?

Accepted Answer

It involves watching blockchain public ledgers; the challenge is that pseudonymous addresses obscure beneficial ownership

Answer

It refers to manually reviewing all trades; the challenge is that crypto markets operate 24/7

Answer

It is the process of verifying each transaction's USD equivalent; the challenge is price volatility

Answer

It means filing CTRs for all transfers; the challenge is that crypto transfers have no fixed threshold

Question 4

When must a U.S.-based cryptocurrency exchange file a Currency Transaction Report (CTR) under Bank Secrecy Act rules?

Accepted Answer

When a customer conducts a transaction or series of related transactions in cash or cash equivalents exceeding $10,000 in a single day

Answer

When a customer's total portfolio value exceeds $10,000

Answer

For every wire transfer regardless of amount

Answer

Only when a customer exchanges cryptocurrency for fiat currency exceeding $10,000

Question 5

Which of the following best describes 'on-chain analytics' as a tool for AML compliance in the cryptocurrency space?

Accepted Answer

A method of analyzing publicly recorded blockchain transaction data to identify suspicious patterns and trace fund flows

Answer

Software that monitors cryptocurrency prices and alerts compliance teams to unusual market movements

Answer

A regulatory reporting system used by VASPs to submit SARs directly to FinCEN

Answer

An AI tool that predicts which customers are likely to engage in money laundering based on demographics

Question 6

A VASP's risk-based approach to customer due diligence should assign higher risk to which type of customer?

Accepted Answer

A business customer whose principal is a Politically Exposed Person operating from a high-risk jurisdiction

Answer

A retail investor making small recurring purchases of Bitcoin over 12 months

Answer

A customer who has completed full KYC and provided government-issued ID

Answer

An institutional investor subject to its own regulated AML program

Question 7

What is the significance of the FATF 'grey list' (Jurisdictions Under Increased Monitoring) for a VASP conducting due diligence on counterparty VASPs?

Accepted Answer

VASPs from grey-listed jurisdictions face enhanced scrutiny because their home country has strategic AML/CFT deficiencies

Answer

Grey-listed countries have banned all cryptocurrency activity and must be blocked entirely

Answer

Grey-listed countries are exempt from the Travel Rule for a transitional period

Answer

Transactions to grey-listed jurisdictions are automatically flagged as terrorist financing