CAMS Money Laundering Typologies and Methods 2

Question 1

What is a 'loan-back' scheme in money laundering?

Accepted Answer

A scheme where criminals 'lend' themselves their own illicit funds and repay the loan with seemingly legitimate funds

Answer

A scheme where criminals obtain bank loans using stolen identities

Answer

A government program designed to compensate money laundering victims

Answer

A method of transferring funds through international syndicated banking facilities

Question 2

Cuckoo smurfing is best described as:

Accepted Answer

Substituting criminal funds for legitimate funds expected in international transfers without the recipient's knowledge

Answer

Using multiple couriers to physically transport bulk cash across international borders

Answer

Converting cash proceeds into stablecoins via peer-to-peer exchanges

Answer

Using shell companies registered in multiple offshore jurisdictions simultaneously

Question 3

Which of the following is the clearest example of the 'placement' stage of money laundering?

Accepted Answer

Depositing cash proceeds from narcotics sales at multiple bank branches below CTR thresholds

Answer

Purchasing luxury goods and art with previously laundered funds

Answer

Creating multiple layers of nominee-owned shell companies in offshore jurisdictions

Answer

Investing clean money into publicly traded stock market securities

Question 4

What does the 'layering' stage of money laundering primarily aim to achieve?

Accepted Answer

To obscure the audit trail and distance the funds from their criminal origin through complex transactions

Answer

To introduce illicit cash into the regulated financial system for the first time

Answer

To integrate laundered funds back into the legitimate economy as apparent lawful income

Answer

To report suspicious transactions voluntarily to financial intelligence authorities

Question 5

The Hawala system of value transfer is best described as:

Accepted Answer

An informal value transfer system based on trust and a network of brokers without physical movement of funds

Answer

An international wire transfer network regulated and overseen by SWIFT messaging standards

Answer

A regulated cryptocurrency exchange network operating across the Middle East and South Asia

Answer

A government-sanctioned foreign currency exchange system used for remittances

Question 6

In trade-based money laundering, 'over-invoicing' refers to:

Accepted Answer

An exporter charging more than market value to transfer excess value from the importing country to the exporting country

Answer

An importer charging less than market value to transfer value to an exporter

Answer

Submitting invoices without accompanying shipping documentation

Answer

Creating entirely fictitious shipping documents for goods that never existed

Question 7

Which typology involves moving illicit funds through a series of foreign correspondent banking relationships to obscure their origin?

Accepted Answer

Correspondent banking layering through nested accounts

Answer

Real estate layering through nominee purchasers

Answer

Structuring deposits across multiple domestic retail banks

Answer

Casino chip laundering and cash-out schemes