Anti-Money Laundry Review Test
Questions and Answers | Latest Version
| 2024/2025 | Graded A+
How should financial institutions approach the verification of customer identity to prevent
money laundering?
✔✔ Financial institutions should implement comprehensive procedures to verify customer
identity, including collecting and validating identification documents, using biometric data where
possible, and cross-referencing with government databases.
What are the key elements to include in an AML policy for a financial institution?
✔✔ Key elements to include in an AML policy are risk assessment procedures, customer due
diligence requirements, reporting protocols for suspicious activities, and staff training programs
to ensure compliance with AML regulations.
How does enhanced due diligence differ from standard due diligence in AML practices?
1
, ✔✔ Enhanced due diligence involves more rigorous scrutiny of higher-risk clients or
transactions, including more detailed background checks and continuous monitoring, compared
to standard due diligence which focuses on basic verification and risk assessment.
What are the potential legal and financial consequences for failing to adhere to AML
regulations?
✔✔ Potential legal and financial consequences include significant fines, penalties, legal action
from regulatory bodies, damage to reputation, and potential restrictions or loss of business
licenses.
How can financial institutions ensure effective AML controls in their global operations?
✔✔ Financial institutions can ensure effective AML controls in global operations by
standardizing AML procedures across all branches, adapting practices to local regulatory
requirements, and implementing a unified monitoring system to track and manage risks.
What strategies can be used to prevent money laundering through online platforms?
2
Questions and Answers | Latest Version
| 2024/2025 | Graded A+
How should financial institutions approach the verification of customer identity to prevent
money laundering?
✔✔ Financial institutions should implement comprehensive procedures to verify customer
identity, including collecting and validating identification documents, using biometric data where
possible, and cross-referencing with government databases.
What are the key elements to include in an AML policy for a financial institution?
✔✔ Key elements to include in an AML policy are risk assessment procedures, customer due
diligence requirements, reporting protocols for suspicious activities, and staff training programs
to ensure compliance with AML regulations.
How does enhanced due diligence differ from standard due diligence in AML practices?
1
, ✔✔ Enhanced due diligence involves more rigorous scrutiny of higher-risk clients or
transactions, including more detailed background checks and continuous monitoring, compared
to standard due diligence which focuses on basic verification and risk assessment.
What are the potential legal and financial consequences for failing to adhere to AML
regulations?
✔✔ Potential legal and financial consequences include significant fines, penalties, legal action
from regulatory bodies, damage to reputation, and potential restrictions or loss of business
licenses.
How can financial institutions ensure effective AML controls in their global operations?
✔✔ Financial institutions can ensure effective AML controls in global operations by
standardizing AML procedures across all branches, adapting practices to local regulatory
requirements, and implementing a unified monitoring system to track and manage risks.
What strategies can be used to prevent money laundering through online platforms?
2
