Finastra Assessment Test Finastra Assessment Financial Crime and Compliance 5

Question 1

Which of the following best describes 'layering' in the money laundering process?

Accepted Answer

Conducting complex financial transactions to distance funds from their illegal source

Answer

Layering involves executing a series of complex financial transactions designed to obscure the audit trail and distance illegal funds from their criminal origin.

Question 2

Under the EU's Anti-Money Laundering Directives (AMLD), what is the threshold for customer due diligence on occasional cash transactions?

Accepted Answer

€10,000

Answer

Under EU AML directives, customer due diligence is required for occasional cash transactions of €10,000 or more, whether conducted in a single operation or several linked operations.

Question 3

What is the primary purpose of a 'Know Your Customer' (KYC) program?

Accepted Answer

To verify customer identity and assess the risk of potential money laundering or terrorist financing

Answer

KYC programs are designed to verify the identity of customers and assess associated risks of illegal intentions, forming the foundation of an AML compliance program.

Question 4

A customer sends multiple international wire transfers to a country with no apparent business connection. Which AML concept best describes this situation?

Accepted Answer

Unusual geographic activity

Answer

Unusual geographic activity — transactions to countries with no logical connection to the customer's known business — is a classic AML red flag requiring further investigation.

Question 5

In the context of financial crime, what is 'cyber-enabled fraud'?

Accepted Answer

Using digital technology or the internet to commit or facilitate traditional fraud schemes at scale

Answer

Cyber-enabled fraud uses digital technologies — such as phishing, malware, or social engineering — to commit traditional fraud schemes more efficiently and at greater scale.

Finastra Assessment Test Practice Test

Finastra Assessment Test Practice Test

Finastra Assessment Test Finastra Assessment Financial Crime and Compliance 5