CAFP 1 UPDATED Actual Exam Questions
and CORRECT Answers
What option describes what makes pouch activity MOST vulnerable to money laundering? -
CORRECT ANSWER✔✔- They enable money launderers to structure using monetary
instruments.
Which option describes why U.S. dollar drafts are MOST vulnerable to money laundering? -
CORRECT ANSWER✔✔- They make it easy for the money launderer to conceal the source
of funds once the illicit funds are no longer in cash form.
How do bulk cash shipments occur? - CORRECT ANSWER✔✔- Between two banks even
when the receiving bank does not take physical possession of the currency and the currency
goes to the Federal Reserve.
Which parties may be involved in bulk cash shipments? - CORRECT ANSWER✔✔- The
shipper, the common carrier, and the consignee.
The CTR exemption process divides businesses into two categories, Phase I and Phase II.
Which type of entity would be eligible for a Phase I exemption? - CORRECT ANSWER✔✔-
Starbucks Express, a subsidiary of Starbucks.
A domestic correspondent account is an account __________. - CORRECT ANSWER✔✔-
Held by one domestic bank with another domestic bank.
Which international partner in the AML network provides a forum for FIUs to improve
international AML/CFT cooperation and to promote the implementation of domestic
programs in this field? - CORRECT ANSWER✔✔- Egmont Group of Financial Intelligence
Units.
The following two organizations specialize in conducting assessments for countries to
ascertain compliance with the FATF Recommendations: - CORRECT ANSWER✔✔- •
International Monetary Fund (IMF),The World Bank.
,the following two international organizations focus on counteracting transnational illicit
drugs, crime, and terrorism: - CORRECT ANSWER✔✔- •Organization for Economic Co-
operation and Development (OECD)
•United Nations Office on Drug and Crime (UNODC).
Which two organizations provide technical assistance to member countries for the assessment
of their compliance with the international standard as contained in the FATF
Recommendations? - CORRECT ANSWER✔✔- International Monetary Fund (IMF) and
The World Bank (Financial Market Integrity Group).
Which three options identify aims of the UNODC work program? - CORRECT
ANSWER✔✔- Assist with increasing specialized expertise and skills of criminal justice
officials, Enhance international and regional cooperation in combating the financing of
terrorism through information exchange and mutual legal assistance, Strengthen legal,
financial and operational capacities to deal effectively with money-laundering and the
financing of terrorism.
Among the international partners in AML, which two organizations focus primarily on tax
and anti-money laundering practices and fighting transnational crimes, including illicit drugs,
crime and terrorism? - CORRECT ANSWER✔✔- OECD, (UNODC).
IMF? - CORRECT ANSWER✔✔- focuses on AML/CFT technical assistance and the
assessment of member countries' compliance with the FATF Recommendations.
Egmont Group? - CORRECT ANSWER✔✔- primary role is to promote the development of
FIUs and facilitate their cooperation in the areas of information exchange, training, and the
sharing of expertise.
What entities comprise the Basel Committee on Banking Supervision? - CORRECT
ANSWER✔✔- Central banks.
Which international organization focuses its anti-money laundering (AML) efforts primarily
on customer due diligence? - CORRECT ANSWER✔✔- The Basel Committee on Banking
Supervision.
, In what way did the Financial Action Task Force (FATF) methodology for conducting mutual
evaluations change in 2012? - CORRECT ANSWER✔✔- FATF now adds an effectiveness
assessment as a new component.
Which option describes the work of the Wolfsberg Group? - CORRECT ANSWER✔✔- To
develop frameworks and guidance for the management of financial crime risks, particularly
with regard to Know Your Customer.
Which option identifies the two international organizations that run the Stolen Asset
Recovery (StAR) Initiative? - CORRECT ANSWER✔✔- The World Bank and the United
Nations Office on Drug and Crime (UNODC).
Which international organization focuses its efforts primarily on tax crimes? - CORRECT
ANSWER✔✔- The Organisation for Economic Co-operation and Development (OECD).
Which option identifies the two international organizations that assist the Financial Action
Task Force (FATF) in assessing countries' compliance with anti-money laundering/counter
financing of terrorism (AML/CFT) requirements? - CORRECT ANSWER✔✔- The World
Bank and the International Monetary Fund (IMF).
ABC Bank offers Internet banking. Which option identifies an essential element of an
account opening policy so that ABC Bank mitigates the related risk of online accounts? -
CORRECT ANSWER✔✔- Authenticate the customer's identity.
ABC Bank is considering establishing a contract with XYZ Company for RDC services. The
bank is reviewing XYZ Company for risk factors. Which three questions should be asked
within the bank's RDC customer review to mitigate possible risks? - CORRECT
ANSWER✔✔- Is XYZ Company capable of taking on the responsibility and liability in the
RDC contract, including detailed record-retention procedures for RDC data? Has XYZ
Company trained its employees on RDC services?Since the risk seems high, what date and
time can a bank representative visit XYZ Company's physical site?.
Primary Wholesale Payment Systems: - CORRECT ANSWER✔✔- The two primary
domestic wholesale payment systems for interbank funds transfers are the Federal Reserve
Wire Network (Fedwire) and the Clearing House Interbank Payments Systems (CHIPS
and CORRECT Answers
What option describes what makes pouch activity MOST vulnerable to money laundering? -
CORRECT ANSWER✔✔- They enable money launderers to structure using monetary
instruments.
Which option describes why U.S. dollar drafts are MOST vulnerable to money laundering? -
CORRECT ANSWER✔✔- They make it easy for the money launderer to conceal the source
of funds once the illicit funds are no longer in cash form.
How do bulk cash shipments occur? - CORRECT ANSWER✔✔- Between two banks even
when the receiving bank does not take physical possession of the currency and the currency
goes to the Federal Reserve.
Which parties may be involved in bulk cash shipments? - CORRECT ANSWER✔✔- The
shipper, the common carrier, and the consignee.
The CTR exemption process divides businesses into two categories, Phase I and Phase II.
Which type of entity would be eligible for a Phase I exemption? - CORRECT ANSWER✔✔-
Starbucks Express, a subsidiary of Starbucks.
A domestic correspondent account is an account __________. - CORRECT ANSWER✔✔-
Held by one domestic bank with another domestic bank.
Which international partner in the AML network provides a forum for FIUs to improve
international AML/CFT cooperation and to promote the implementation of domestic
programs in this field? - CORRECT ANSWER✔✔- Egmont Group of Financial Intelligence
Units.
The following two organizations specialize in conducting assessments for countries to
ascertain compliance with the FATF Recommendations: - CORRECT ANSWER✔✔- •
International Monetary Fund (IMF),The World Bank.
,the following two international organizations focus on counteracting transnational illicit
drugs, crime, and terrorism: - CORRECT ANSWER✔✔- •Organization for Economic Co-
operation and Development (OECD)
•United Nations Office on Drug and Crime (UNODC).
Which two organizations provide technical assistance to member countries for the assessment
of their compliance with the international standard as contained in the FATF
Recommendations? - CORRECT ANSWER✔✔- International Monetary Fund (IMF) and
The World Bank (Financial Market Integrity Group).
Which three options identify aims of the UNODC work program? - CORRECT
ANSWER✔✔- Assist with increasing specialized expertise and skills of criminal justice
officials, Enhance international and regional cooperation in combating the financing of
terrorism through information exchange and mutual legal assistance, Strengthen legal,
financial and operational capacities to deal effectively with money-laundering and the
financing of terrorism.
Among the international partners in AML, which two organizations focus primarily on tax
and anti-money laundering practices and fighting transnational crimes, including illicit drugs,
crime and terrorism? - CORRECT ANSWER✔✔- OECD, (UNODC).
IMF? - CORRECT ANSWER✔✔- focuses on AML/CFT technical assistance and the
assessment of member countries' compliance with the FATF Recommendations.
Egmont Group? - CORRECT ANSWER✔✔- primary role is to promote the development of
FIUs and facilitate their cooperation in the areas of information exchange, training, and the
sharing of expertise.
What entities comprise the Basel Committee on Banking Supervision? - CORRECT
ANSWER✔✔- Central banks.
Which international organization focuses its anti-money laundering (AML) efforts primarily
on customer due diligence? - CORRECT ANSWER✔✔- The Basel Committee on Banking
Supervision.
, In what way did the Financial Action Task Force (FATF) methodology for conducting mutual
evaluations change in 2012? - CORRECT ANSWER✔✔- FATF now adds an effectiveness
assessment as a new component.
Which option describes the work of the Wolfsberg Group? - CORRECT ANSWER✔✔- To
develop frameworks and guidance for the management of financial crime risks, particularly
with regard to Know Your Customer.
Which option identifies the two international organizations that run the Stolen Asset
Recovery (StAR) Initiative? - CORRECT ANSWER✔✔- The World Bank and the United
Nations Office on Drug and Crime (UNODC).
Which international organization focuses its efforts primarily on tax crimes? - CORRECT
ANSWER✔✔- The Organisation for Economic Co-operation and Development (OECD).
Which option identifies the two international organizations that assist the Financial Action
Task Force (FATF) in assessing countries' compliance with anti-money laundering/counter
financing of terrorism (AML/CFT) requirements? - CORRECT ANSWER✔✔- The World
Bank and the International Monetary Fund (IMF).
ABC Bank offers Internet banking. Which option identifies an essential element of an
account opening policy so that ABC Bank mitigates the related risk of online accounts? -
CORRECT ANSWER✔✔- Authenticate the customer's identity.
ABC Bank is considering establishing a contract with XYZ Company for RDC services. The
bank is reviewing XYZ Company for risk factors. Which three questions should be asked
within the bank's RDC customer review to mitigate possible risks? - CORRECT
ANSWER✔✔- Is XYZ Company capable of taking on the responsibility and liability in the
RDC contract, including detailed record-retention procedures for RDC data? Has XYZ
Company trained its employees on RDC services?Since the risk seems high, what date and
time can a bank representative visit XYZ Company's physical site?.
Primary Wholesale Payment Systems: - CORRECT ANSWER✔✔- The two primary
domestic wholesale payment systems for interbank funds transfers are the Federal Reserve
Wire Network (Fedwire) and the Clearing House Interbank Payments Systems (CHIPS
