RBC RBC - Online Assessment Risk Management and Compliance Questions and Answers 1

Question 1

What is the primary goal of anti-money laundering (AML) compliance at a bank like RBC?

Accepted Answer

To detect, prevent, and report financial transactions that may be linked to criminal activity

Answer

AML compliance programs are designed to identify suspicious transactions and report them to regulators in order to prevent the bank from being used to launder proceeds of crime.

Question 2

Under FINTRAC regulations, Canadian banks must file a Suspicious Transaction Report (STR) when:

Accepted Answer

There are reasonable grounds to suspect a transaction is related to money laundering or terrorist financing

Answer

FINTRAC requires reporting entities to file an STR when there are reasonable grounds to suspect that a transaction is connected to money laundering or terrorist financing.

Question 3

What does 'credit risk' specifically refer to in banking?

Accepted Answer

The risk that a borrower will fail to meet their contractual repayment obligations

Answer

Credit risk is the possibility that a borrower or counterparty will default on their obligations, resulting in a financial loss for the bank.

Question 4

A bank employee notices that a long-standing client suddenly begins making frequent large cash deposits inconsistent with their known business. What should the employee do FIRST?

Accepted Answer

Document the unusual activity and escalate to the compliance team for review

Answer

Unusual activity inconsistent with a client's known profile should be documented and referred to the bank's compliance or AML team for investigation, not independently acted upon.

Question 5

What is 'operational risk' in a banking context?

Accepted Answer

The risk of loss resulting from inadequate internal processes, people, systems, or external events

Answer

Operational risk encompasses losses caused by failures in internal controls, human error, technology systems, or external events such as fraud or natural disasters.

RBC - Online Assessment Practice Test

RBC - Online Assessment Practice Test

RBC RBC - Online Assessment Risk Management and Compliance Questions and Answers 1