Practice Test GeeksCAMS - Certified Anti-Money Laundering Specialist Certification Practice Test
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Money Laundering Typologies and Methods Flashcards

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  1. What are the three classic stages of the money laundering process?

    Answer: Placement, layering, integration

    The three universally recognized stages are placement (introducing funds), layering (obscuring the trail), and integration (returning funds as legitimate).

  2. Which stage of the money laundering process involves introducing illicit cash into the financial system for the first time?

    Answer: Placement

    Placement is the first stage, where criminal proceeds are physically deposited or converted into financial instruments to enter the formal financial system.

  3. What is 'structuring' (also known as 'smurfing') in the context of money laundering?

    Answer: Breaking large cash deposits into smaller amounts to avoid Currency Transaction Report thresholds

    Structuring involves deliberately breaking up large cash deposits into smaller transactions (under $10,000 in the US) to evade CTR filing requirements.

  4. Trade-Based Money Laundering (TBML) most commonly involves which of the following techniques?

    Answer: Manipulating trade invoices and shipping documents to transfer value across borders

    TBML exploits international trade transactions by over- or under-invoicing goods and services to move value between parties while disguising its illicit origin.

  5. In money laundering, a 'shell company' is best defined as:

    Answer: A legal entity with no genuine business operations used to conceal asset ownership

    Shell companies lack real operations or employees and are used to add layers of anonymity, making it difficult to trace the true beneficial owner of assets.

  6. Real estate money laundering most commonly occurs during which stage of the laundering process?

    Answer: Integration

    Integration occurs when laundered funds re-enter the legitimate economy; purchasing real estate with clean-appearing funds is a classic integration technique.

  7. Which money laundering typology involves converting large amounts of cash into monetary instruments such as money orders, traveler's checks, or cashier's checks?

    Answer: Monetary instrument purchases

    Purchasing monetary instruments with cash is a classic placement technique because such instruments are easier to deposit, transport, and negotiate than bulk cash.