BSAC EXAM PREP 2025 QUESTIONS WITH ALL CORRECT ANSWERS
True or False:
The credit union's BSA Officer is ultimately responsible for the credit union's BSA compliance. -
CORRECT ANSWER✅✅✅False.
Although the BSA Officer is responsible for coordinating and monitoring day-to-day BSA/AML
compliance and managing all aspects of the BSA compliance program, the credit union's board
of directors is ultimately responsible for the credit union's compliance. This is why it is critical
that the board of directors designate a qualified BSA officer and receive appropriate BSA/AML
training annually.
The BSA Officer must be knowledgeable of:
A. The BSA, and related regulations;
B. The credit union's products and
services;
C. The credit union's members;
D. The credit union's neighborhoods;
E. a & b
F. All of the above. - CORRECT ANSWER✅✅✅The answer is F.
The BSA Officer is expected to be fully knowledgeable of the Bank Secrecy Act and all related
regulations, as well as understand the money laundering and terrorist financing risks associated
with the credit union's products, services, members, and geographic locations of each credit
union office and branch. The BSA Officer should be in a position to regularly apprise the senior
management staff and the board of directors of ongoing compliance with the BSA/AML
requirements.
True or False:
If you are a small credit union (less than $100 million) it is acceptable to have the BSA Officer
identify when BSA- related reports must be filed, fill out the reports, and determine when
members are eligible to be exempt from BSA reporting. - CORRECT ANSWER✅✅✅False.
As part of the credit union's internal controls, you must have policies and procedures in place to
limit and control risks associated with BSA/AML. Such internal controls include the segregation
of duties whenever possible, so that it isn't the same person determining who is exempt from
,filing, when a report should be filed, and actually completing the reports. It is important to have a
"checks and balances" system in place.
Regulators recommend that independent testing of your BSA program should be done:
A. Annually
B. Every 12 to 18 months
C. Whenever necessary
D. Before each exam - CORRECT ANSWER✅✅✅The answer is B.
The frequency of the required independent testing is not specifically defined in the regulation,
however, the regulators recommend that it be done every 12 to 18 months, depending on the
credit union's risk profile.
Which of the following products and services may have a higher risk for illegal activities?
A. Wire transfers
B. Monetary instruments
C. Traveler's Checks
D. All of the above - CORRECT ANSWER✅✅✅The answer is D.
Although attempts to launder money or conduct other illegal activities through a credit union can
emanate from many different sources, certain products, services, members, and geographic
locations may be more vulnerable or have historically been known to be abused by money
launderers and criminals. For example, some products and services may allow a higher degree of
anonymity ( such as electronic funds payments), or involve the handling of high volumes of
currency (such as monetary instruments like cashier's checks, money orders, and traveler's
checks).
The identification and verification rules do NOT apply to which of the following?
A. Joint owners
B. Beneficiaries
,C. Co-borrowers
D. Non-resident aliens
E. Applies to A, B, C & D. - CORRECT ANSWER✅✅✅The correct answer is "B."
The CIP/MIP regulations apply to anyone applying to open an account, which includes any
accountholder on the account (members and non-members). This will include joint owners and
trustees, as well as both resident and non-resident aliens. However, beneficiaries are not signers
on an account and may not even know they are beneficiaries; therefore, they are not included on
this list. Additionally, the definition of "account" means any "formal banking or business
relationship established to provide an ongoing service, dealing, or other financial transaction."
This definition is broad enough to include loans, and therefore co-borrowers would also fall
under the requirements.
Yes or No:
Does the CIP/MIP rule prohibit a minor from opening an account? - CORRECT
ANSWER✅✅✅No.
The CIP/MIP rule states that the credit union's "member" includes an individual who opens the
account for an individual who lacks legal capacity, such as a minor. In other words, if a parent
opens an account for a child, the member for purposes of the CIP/MIP rule is the parent. If,
however, a minor opens the account, then the minor is the member. According to NCUA, when a
minor opens the account, he/she can be verified through documentary methods such as a driver's
license or work permit. If these are not available, the minor could be identified through
nondocumentary methods such as verification by an existing member, using public databases, or
verification of identity by parent/teacher. A credit union's CIP/MIP policy must specify what
types of documentary and/or non-documentary evidence it will accept for a minor's account and
the circumstances under which such documentation will be acceptable.
Treasury explains that when a credit union sends its' employees to elementary schools to allow
students to open savings accounts as part of a program to promote financial literacy, a student
opening the account is the member and the credit union must get the name, address, date of birth,
and taxpayer identification number of the student. Since verification procedures are risked-based,
credit unions can use any reasonable documentary or non- documentary method to verify a
student's identification.
Yes or No:
Must a credit union verify the accuracy of all of the identifying information it collects during the
CIP/MIP process? - CORRECT ANSWER✅✅✅No.
, The regulation provides that a credit union's CIP/MIP must contain procedures for verifying the
identity of the member using the information obtained during the credit union's CIP/MIP
process. A credit union need not establish the accuracy of every element of identifying
information obtained, but must verify enough information to form a reasonable belief that it
knows the true identity of the member.
Yes or No:
To satisfy the CIP/MIP record-keeping requirements, the credit union must retain the original
information collected at account opening, in addition to updated information about the member
(such as the member's current address). - CORRECT ANSWER✅✅✅Yes.
The CIP/MIP regulation requires credit unions to retain the original information collected at the
time of account opening for five years after the date the account is closed. Obtaining and
maintaining updated member information serves a valuable, but different purpose.
A non-profit organization wants to open an account at the credit union. However, since non-
profits do not have any "owners", it cannot provide "beneficial" owner information. How can the
credit union open this account?
A. This account cannot be opened because the credit union cannot verify identifying information
from at least one person who owns 25% or more of the legal entity.
B. The credit union can open the account by collecting the identifying information from at least
one board member to satisfy the "owner criteria";
C. The credit union can open the account by collecting identifying information from at one
person who meets the "control" criteria;
D. The credit union can open the account because non-profits are not legal entities. - CORRECT
ANSWER✅✅✅The correct answer is C.
The regulation allows for some legal entities to be subject only to the "control criteria". Non-
profit corporations, and similar entities, that have filed their organizational documents with the
appropriate State authority meet this exception. This exception makes option (a) incorrect.
Option (b) is incorrect because none of the board members may own 25% or more of a non-
profit organization. If one of the board members happens to have a controlling position with the
non-profit organization, the credit union could open the account with this board member's
identifying information to meet the "control criteria", but this board member will not meet the
"owner criteria".
True or False:
The credit union's BSA Officer is ultimately responsible for the credit union's BSA compliance. -
CORRECT ANSWER✅✅✅False.
Although the BSA Officer is responsible for coordinating and monitoring day-to-day BSA/AML
compliance and managing all aspects of the BSA compliance program, the credit union's board
of directors is ultimately responsible for the credit union's compliance. This is why it is critical
that the board of directors designate a qualified BSA officer and receive appropriate BSA/AML
training annually.
The BSA Officer must be knowledgeable of:
A. The BSA, and related regulations;
B. The credit union's products and
services;
C. The credit union's members;
D. The credit union's neighborhoods;
E. a & b
F. All of the above. - CORRECT ANSWER✅✅✅The answer is F.
The BSA Officer is expected to be fully knowledgeable of the Bank Secrecy Act and all related
regulations, as well as understand the money laundering and terrorist financing risks associated
with the credit union's products, services, members, and geographic locations of each credit
union office and branch. The BSA Officer should be in a position to regularly apprise the senior
management staff and the board of directors of ongoing compliance with the BSA/AML
requirements.
True or False:
If you are a small credit union (less than $100 million) it is acceptable to have the BSA Officer
identify when BSA- related reports must be filed, fill out the reports, and determine when
members are eligible to be exempt from BSA reporting. - CORRECT ANSWER✅✅✅False.
As part of the credit union's internal controls, you must have policies and procedures in place to
limit and control risks associated with BSA/AML. Such internal controls include the segregation
of duties whenever possible, so that it isn't the same person determining who is exempt from
,filing, when a report should be filed, and actually completing the reports. It is important to have a
"checks and balances" system in place.
Regulators recommend that independent testing of your BSA program should be done:
A. Annually
B. Every 12 to 18 months
C. Whenever necessary
D. Before each exam - CORRECT ANSWER✅✅✅The answer is B.
The frequency of the required independent testing is not specifically defined in the regulation,
however, the regulators recommend that it be done every 12 to 18 months, depending on the
credit union's risk profile.
Which of the following products and services may have a higher risk for illegal activities?
A. Wire transfers
B. Monetary instruments
C. Traveler's Checks
D. All of the above - CORRECT ANSWER✅✅✅The answer is D.
Although attempts to launder money or conduct other illegal activities through a credit union can
emanate from many different sources, certain products, services, members, and geographic
locations may be more vulnerable or have historically been known to be abused by money
launderers and criminals. For example, some products and services may allow a higher degree of
anonymity ( such as electronic funds payments), or involve the handling of high volumes of
currency (such as monetary instruments like cashier's checks, money orders, and traveler's
checks).
The identification and verification rules do NOT apply to which of the following?
A. Joint owners
B. Beneficiaries
,C. Co-borrowers
D. Non-resident aliens
E. Applies to A, B, C & D. - CORRECT ANSWER✅✅✅The correct answer is "B."
The CIP/MIP regulations apply to anyone applying to open an account, which includes any
accountholder on the account (members and non-members). This will include joint owners and
trustees, as well as both resident and non-resident aliens. However, beneficiaries are not signers
on an account and may not even know they are beneficiaries; therefore, they are not included on
this list. Additionally, the definition of "account" means any "formal banking or business
relationship established to provide an ongoing service, dealing, or other financial transaction."
This definition is broad enough to include loans, and therefore co-borrowers would also fall
under the requirements.
Yes or No:
Does the CIP/MIP rule prohibit a minor from opening an account? - CORRECT
ANSWER✅✅✅No.
The CIP/MIP rule states that the credit union's "member" includes an individual who opens the
account for an individual who lacks legal capacity, such as a minor. In other words, if a parent
opens an account for a child, the member for purposes of the CIP/MIP rule is the parent. If,
however, a minor opens the account, then the minor is the member. According to NCUA, when a
minor opens the account, he/she can be verified through documentary methods such as a driver's
license or work permit. If these are not available, the minor could be identified through
nondocumentary methods such as verification by an existing member, using public databases, or
verification of identity by parent/teacher. A credit union's CIP/MIP policy must specify what
types of documentary and/or non-documentary evidence it will accept for a minor's account and
the circumstances under which such documentation will be acceptable.
Treasury explains that when a credit union sends its' employees to elementary schools to allow
students to open savings accounts as part of a program to promote financial literacy, a student
opening the account is the member and the credit union must get the name, address, date of birth,
and taxpayer identification number of the student. Since verification procedures are risked-based,
credit unions can use any reasonable documentary or non- documentary method to verify a
student's identification.
Yes or No:
Must a credit union verify the accuracy of all of the identifying information it collects during the
CIP/MIP process? - CORRECT ANSWER✅✅✅No.
, The regulation provides that a credit union's CIP/MIP must contain procedures for verifying the
identity of the member using the information obtained during the credit union's CIP/MIP
process. A credit union need not establish the accuracy of every element of identifying
information obtained, but must verify enough information to form a reasonable belief that it
knows the true identity of the member.
Yes or No:
To satisfy the CIP/MIP record-keeping requirements, the credit union must retain the original
information collected at account opening, in addition to updated information about the member
(such as the member's current address). - CORRECT ANSWER✅✅✅Yes.
The CIP/MIP regulation requires credit unions to retain the original information collected at the
time of account opening for five years after the date the account is closed. Obtaining and
maintaining updated member information serves a valuable, but different purpose.
A non-profit organization wants to open an account at the credit union. However, since non-
profits do not have any "owners", it cannot provide "beneficial" owner information. How can the
credit union open this account?
A. This account cannot be opened because the credit union cannot verify identifying information
from at least one person who owns 25% or more of the legal entity.
B. The credit union can open the account by collecting the identifying information from at least
one board member to satisfy the "owner criteria";
C. The credit union can open the account by collecting identifying information from at one
person who meets the "control" criteria;
D. The credit union can open the account because non-profits are not legal entities. - CORRECT
ANSWER✅✅✅The correct answer is C.
The regulation allows for some legal entities to be subject only to the "control criteria". Non-
profit corporations, and similar entities, that have filed their organizational documents with the
appropriate State authority meet this exception. This exception makes option (a) incorrect.
Option (b) is incorrect because none of the board members may own 25% or more of a non-
profit organization. If one of the board members happens to have a controlling position with the
non-profit organization, the credit union could open the account with this board member's
identifying information to meet the "control criteria", but this board member will not meet the
"owner criteria".
