CFE Money Laundering 3

Question 1

Which analytical technique involves tracing the flow of funds from the point of origin through all transactions to identify the ultimate destination?

Accepted Answer

Follow-the-money analysis

Answer

Follow-the-money analysis traces financial flows from their source through each transaction to identify where illicit proceeds ultimately end up.

Question 2

The term 'beneficial owner' in AML compliance refers to:

Accepted Answer

The natural person who ultimately owns or controls a legal entity or account

Answer

A beneficial owner is the natural person who ultimately owns or controls an entity, or on whose behalf a transaction is conducted, regardless of who appears on official documents.

Question 3

Which of the following best describes 'trade-based money laundering' (TBML)?

Accepted Answer

Laundering money through over- or under-invoicing of goods and services in international trade

Answer

TBML exploits international trade by manipulating the price, quantity, or quality of goods/services in invoices to transfer value across borders and obscure the origin of funds.

Question 4

When a fraud examiner detects a pattern where large cash deposits are made just below reporting thresholds over multiple days at different branches, the most likely violation is:

Accepted Answer

Structuring under 31 U.S.C. § 5324

Answer

31 U.S.C. § 5324 specifically prohibits structuring transactions to evade currency reporting requirements, which is exactly what this pattern describes.

Question 5

Real estate is often used as a money laundering vehicle because:

Accepted Answer

Large amounts of money can be absorbed, and properties can be resold to generate seemingly legitimate proceeds

Answer

Real estate allows launderers to absorb large sums, inflate or deflate prices, and ultimately sell the property to produce apparently legitimate proceeds.

Certified Fraud Examiner Exam Practice Test

Certified Fraud Examiner Exam Practice Test

CFE Money Laundering 3