C4 Quality Assurance & Compliance 2

Question 1

Under the Bank Secrecy Act (BSA), what is the minimum transaction amount that triggers a Currency Transaction Report (CTR) for crypto exchanges operating in the US?

Accepted Answer

$10,000

Answer

The BSA requires filing a CTR for any currency transaction exceeding $10,000, including those at cryptocurrency exchanges registered as Money Services Businesses.

Question 2

Which FATF Recommendation specifically addresses the 'Travel Rule' for virtual asset service providers (VASPs)?

Accepted Answer

Recommendation 16

Answer

FATF Recommendation 16 (the Travel Rule) requires VASPs to transmit originator and beneficiary information alongside virtual asset transfers.

Question 3

A crypto exchange discovers a customer has structured multiple deposits just below the $10,000 CTR threshold. What is this practice called and what report must be filed?

Accepted Answer

Structuring; file a SAR

Answer

Structuring (also called smurfing) involves deliberately breaking up transactions to avoid reporting thresholds, and must be reported via a Suspicious Activity Report (SAR).

Question 4

Which US regulatory body requires cryptocurrency exchanges to register as Money Services Businesses (MSBs)?

Accepted Answer

FinCEN

Answer

FinCEN (Financial Crimes Enforcement Network) requires cryptocurrency exchangers and administrators to register as MSBs under the BSA.

Question 5

What does a robust blockchain analytics tool primarily help a compliance team detect?

Accepted Answer

Illicit transaction patterns and wallet clustering

Answer

Blockchain analytics tools use heuristics and clustering algorithms to identify wallets associated with illicit activity such as darknet markets, ransomware, and mixing services.

(C4) CryptoCurrency Certification Consortium Practice Test

(C4) CryptoCurrency Certification Consortium Practice Test

C4 Quality Assurance & Compliance 2