CAFCA Manual UPDATED ACTUAL
Questions and CORRECT Answers
What is financial crime? - CORRECT ANSWER - Illegal activities that are usually
economically motivated.
What is money laundering? - CORRECT ANSWER - The process of concealing or disguising
the existence, source, movement, destination, or illegal application of criminally derived
property or funds to make them appear legitimate.
Three stages of money laundering - CORRECT ANSWER - - Placement
- Layering
- Integration
What is terrorist financing? - CORRECT ANSWER - Involves fund for an illegal political
purpose to support terrorist activities. However, money is necessarily derived from the proceeds
of illegal activity.
Hawala system plays a big roles in moving terrorist related funds.
What are sanctions? - CORRECT ANSWER - Political decision made as part of diplomatic
efforts by countries, regional organization, and international bodies. Sanctions are primarily a
foreign policy and security tool. Sanctions are intended to affect behavioral change through
deterrence, prevention, or punishment.
What is fraud? - CORRECT ANSWER - An International act of criminal deception in order to
obtain an unjust or illegal advantage. Usually for personal gain.
Reasons people commit fraud - CORRECT ANSWER - - Pressure
- Opportunity
- Rationalization
4th Capacity
, What is anti-bribery and corruption? - CORRECT ANSWER - Bribrery is the giving or
receiving of a financial or other advantage in connection with the improper performance of a
position or trust, or a function that is expected to be performed impartially, or in good faith.
Anti-bribery and Corruption Law? - CORRECT ANSWER - - The Foreign Corrupt Practices
Act US
- The UK Bribery Act 2010
What is tax avoidance? - CORRECT ANSWER - The legal means to reduce the tax owed.
What is tax evasion? - CORRECT ANSWER - The illegal means to avoid paying tax owed.
Regulation to combat tax evasion? - CORRECT ANSWER - The Foreign Account Tax
Compliance Act (FATCA)
Types of financial crime risks? - CORRECT ANSWER - - Regulatory
- Legal
- Financial
- Reputational
Anti Money Laundering Regulations? - CORRECT ANSWER - - Bank Secrecy Act (BSA)
US
- 5th AML Directive EU
- The ML and TF Regulation 2019 UK
What does the Foreign Corrupt Practices Act of 1977 do? (FCPA_ - CORRECT ANSWER -
Prohibits US companies and individuals from paying bribes to foreign officials to further a
business deal.
Questions and CORRECT Answers
What is financial crime? - CORRECT ANSWER - Illegal activities that are usually
economically motivated.
What is money laundering? - CORRECT ANSWER - The process of concealing or disguising
the existence, source, movement, destination, or illegal application of criminally derived
property or funds to make them appear legitimate.
Three stages of money laundering - CORRECT ANSWER - - Placement
- Layering
- Integration
What is terrorist financing? - CORRECT ANSWER - Involves fund for an illegal political
purpose to support terrorist activities. However, money is necessarily derived from the proceeds
of illegal activity.
Hawala system plays a big roles in moving terrorist related funds.
What are sanctions? - CORRECT ANSWER - Political decision made as part of diplomatic
efforts by countries, regional organization, and international bodies. Sanctions are primarily a
foreign policy and security tool. Sanctions are intended to affect behavioral change through
deterrence, prevention, or punishment.
What is fraud? - CORRECT ANSWER - An International act of criminal deception in order to
obtain an unjust or illegal advantage. Usually for personal gain.
Reasons people commit fraud - CORRECT ANSWER - - Pressure
- Opportunity
- Rationalization
4th Capacity
, What is anti-bribery and corruption? - CORRECT ANSWER - Bribrery is the giving or
receiving of a financial or other advantage in connection with the improper performance of a
position or trust, or a function that is expected to be performed impartially, or in good faith.
Anti-bribery and Corruption Law? - CORRECT ANSWER - - The Foreign Corrupt Practices
Act US
- The UK Bribery Act 2010
What is tax avoidance? - CORRECT ANSWER - The legal means to reduce the tax owed.
What is tax evasion? - CORRECT ANSWER - The illegal means to avoid paying tax owed.
Regulation to combat tax evasion? - CORRECT ANSWER - The Foreign Account Tax
Compliance Act (FATCA)
Types of financial crime risks? - CORRECT ANSWER - - Regulatory
- Legal
- Financial
- Reputational
Anti Money Laundering Regulations? - CORRECT ANSWER - - Bank Secrecy Act (BSA)
US
- 5th AML Directive EU
- The ML and TF Regulation 2019 UK
What does the Foreign Corrupt Practices Act of 1977 do? (FCPA_ - CORRECT ANSWER -
Prohibits US companies and individuals from paying bribes to foreign officials to further a
business deal.
