CII R01 Financial Crime Prevention 2

Question 1

What is the role of a Money Laundering Reporting Officer (MLRO)?

Accepted Answer

To receive internal disclosures of suspicious activity and decide whether to submit SARs to the NCA

Answer

The MLRO is responsible for receiving internal reports of suspicious activity from employees, evaluating them, and if appropriate, submitting SARs to the NCA. The MLRO must be a senior person within the firm.

Question 2

What is a Politically Exposed Person (PEP)?

Accepted Answer

A person entrusted with a prominent public function, or their family members and close associates

Answer

A PEP is an individual entrusted with a prominent public function (such as heads of state, ministers, judges, or senior military officers), plus their family members and known close associates. PEPs present a higher risk of corruption.

Question 3

What are the main money laundering offences under the Proceeds of Crime Act 2002?

Accepted Answer

Concealing, arranging, and acquiring/using/possessing criminal property

Answer

POCA creates three principal money laundering offences: concealing criminal property (s.327), arranging the acquisition, retention, use, or control of criminal property (s.328), and acquiring, using, or possessing criminal property (s.329).

Question 4

What is 'reliance' in the context of CDD?

Accepted Answer

Relying on another regulated person to apply CDD measures, while remaining liable for any failure

Answer

Under the MLR 2017, a firm can rely on another regulated person to apply CDD measures. However, the firm relying on the other person remains liable for any failure to apply adequate CDD.

Question 5

What is the purpose of ongoing monitoring in AML compliance?

Accepted Answer

To scrutinise transactions and keep CDD information up to date to detect suspicious activity

Answer

Ongoing monitoring involves scrutinising transactions to ensure they are consistent with the firm's knowledge of the customer and their risk profile, and keeping CDD information up to date throughout the business relationship.

CII R01 Practice Test

CII R01 Practice Test

CII R01 Financial Crime Prevention 2