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ACAMS CKYCA certification exam is recognized as a mark of excellence in the financial industry. The credential is highly respected by employers and clients alike, and it demonstrates a commitment to ethical and professional standards. Association of Certified Anti Money Laundering certification also provides professionals with access to a global network of AML experts, which can be a valuable resource for career advancement.
NEW QUESTION # 35
Delivery Channel Risk is associated with? (SELECT 3)
- A. Payable through accounts.
- B. Savings accounts
- C. Correspondent banks.
- D. Concentration accounts
- E. Deposit accounts
Answer: A,C,D
NEW QUESTION # 36
A KYC analyst is onboarding a client based in a known offshore jurisdiction. Based on the client's incorporation documentation and statement, the purpose of the company is to hold the shares of its subsidiary. Public records and registers indicate that the registered address is also used by multiple other legal entities. Which CDD step should the KYC analyst take?
- A. Ask for the client's utility bill confirming the registered address.
- B. Follow the regular KYC requirements as per legal form of the client
- C. Perform EDD, as the client might be a shell company.
- D. Follow the KYC requirements for the holding companies
Answer: C
Explanation:
The combination of being in an offshore jurisdiction, having a registered address shared by many entities, and acting only as a holding company raises a high risk of the client being a shell company, requiring Enhanced Due Diligence (EDD).
NEW QUESTION # 37
Which risk assessment factor is most essential for a customer risk evaluation?
- A. Customer country/jurisdiction of establishment
- B. Customer size in terms of the number of employees
- C. Number of years the company has been in operation
B Number of countries the company operates in
Answer: A
Explanation:
The customer's country or jurisdiction of establishment is a key risk assessment factor because it determines the applicable legal framework, AML/CFT risk level, and potential exposure to high-risk or sanctioned regions.
NEW QUESTION # 38
What corporate vehicles can a money launderer hide behind, where it is difficult to identify the beneficial owner? (SELECT 4)
- A. Private investment companies.
- B. Shell companies.
- C. Sole Proprietors.
- D. Regulated investment advisors
- E. Trusts.
Answer: A,B,C,E
NEW QUESTION # 39
Although you might find all the information you gathered throughout your research to be interesting, should include only relevant information in your final report?
- A. No
- B. Yes.
- C. Depends on the discretion of the analyst.
Answer: B
NEW QUESTION # 40
Financial institutions should ensure that a customer's risk weighting:
- A. is not unduly influenced by just one factor.
- B. is identical throughout the business sector.
- C. takes into account economic or profit considerations.
- D. does not exceed automatically generated risk indicators.
Answer: A
Explanation:
A proper customer risk assessment must consider multiple factors - such as geography, products, services, and customer profile - so that the overall risk rating is balanced and not disproportionately influenced by any single criterion.
NEW QUESTION # 41
An existing customer publicly states she is planning to run for public office, but changes her mind. Which action should a KYC analyst take?
- A. Discuss the matter with the Money Laundering Reporting Officer to determine if more information is required for the due diligence file
- B. Reach out to the customer to determine if she plans to run for public office in the future.
- C. Designate the customer as a high-risk customer due to the attention caused by her public statement.
- D. Review the customer's compliance file to fill in any gaps needed to complete her new EDD status.
Answer: A
Explanation:
A public statement about running for office raises potential PEP considerations. Even if the customer changes her mind, the KYC analyst should discuss the matter with the Money Laundering Reporting Officer to assess whether further information is needed to update the due diligence file.
NEW QUESTION # 42
Which piece of evidence would be a red flag that a customer is a shell company?
- A. The company's place of business is a gatekeeper address.
- B. The company registry lists only one director of the customer.
- C. The company name includes the word "holding'.
- D. The company was incorporated three weeks ago.
Answer: A
Explanation:
A gatekeeper address, such as a law firm or company formation agent's address with no real operational presence, is a strong red flag indicating the entity may be a shell company used to conceal beneficial ownership or illicit activities.
NEW QUESTION # 43
What is the Second Line of Defense? (SLOD)
- A. The _______ line of defense is also known as the front line, these customer-facing employees are best-equipped to get the information you need for your customer due diligence. Can include Operations, risk, and control teams.
- B. The _______ line of defense is the compliance and internal control functions. That includes the chief money laundering reporting officer, or MLRO, in charge of managing and monitoring AML and CFT activities.
- C. The ________ line of defense is internal audit. They perform an independent review of the controls applied by the lines of defense.
Answer: B
NEW QUESTION # 44
A hospitality worker brings deposits items that appear to be made from a cash intensive business. Is this a red flag?
- A. Yes, anyone who brings that type of currency is likely involved to have received it from illegal means.
- B. No, the customer profile for the hospitality worker fits their occupation.
- C. It depends on the location, business, and feeling of the employee accepting the deposit.
Answer: B
NEW QUESTION # 45
The four step model is a model designed to?
- A. Improve the quality of the KYC Rule.
- B. Improve the quality of your KYC Program.
- C. Improve the quality of your KYC Files.
- D. Improve the quality of your KYC Research.
Answer: D
NEW QUESTION # 46
What is the Primary Money Laundering Regulation in the United Kingdom?
- A. Proceeds of Crime Act
- B. Proceeds of Terrorism Act
- C. UK AML Sanctions Regime
- D. The Money Laundering and Terrorist Financing (Amendment) Regulation 2019
Answer: D
NEW QUESTION # 47
A person disclosing to any other person, information or any other matter, which is likely to prejudice a money laundering investigation is known to be?
- A. Ripping off
- B. Dripping off
- C. Dipping off
- D. Tipping off
Answer: D
NEW QUESTION # 48
In relation to account activity, which is an example of tipping off?
- A. Disclosure of information to a regulatory body
- B. Disclosure of inside information based on KYC knowledge of a specific client
- C. Request of additional information with respect to a client's behavior
- D. Disclosure of a suspicious transaction report to the subject of that report
Answer: D
Explanation:
Tipping off occurs when a customer is informed that a suspicious transaction report (STR) has been filed about them, which could compromise investigations and is prohibited under AML laws.
NEW QUESTION # 49
A KYC analyst notices frequent use of letters of credit as a method of trade finance. It further appears that trades covered by letters of credit are not consistent with the customer's usual business. What should be the next action taken by the KYC analyst?
- A. Prepare to close the customer's account.
- B. Notify the Board of Directors and obtain the Board's approval for filing a STR.
- C. Refer internally for a potential suspicious transaction report
- D. Establish internally the existence of a criminal violation.
Answer: C
Explanation:
Unusual trade finance activity, such as letters of credit inconsistent with the customer's normal business, is a potential red flag for trade-based money laundering. The appropriate step is to make an internal referral for review and possible filing of a suspicious transaction report (STR).
NEW QUESTION # 50
A longstanding client asks to open two additional accounts, one for a trust and one for private equity investments.
The trust account will be funded with dividends stemming from the investments as well as a one-off transfer from one of the client's existing accounts. As a first step, a KYC analyst should properly document the:
- A. initial transfer from the client's existing account
- B. dividends from the private equity investments.
- C. transactions between the two new accounts.
- D. beneficiary/beneficiaries of the trust
Answer: D
Explanation:
When opening an account for a trust, the first step in KYC is to identify and document the trust's beneficiaries, along with other key parties such as the settlor and trustees, to establish transparency over the ultimate beneficial ownership.
NEW QUESTION # 51
Is collecting identification a legal requirement in jurisdictions?
- A. No.
- B. Yes.
- C. Most.
Answer: C
NEW QUESTION # 52
Financial Institutions include? (SELECT 2)
- A. Broker Dealer.
- B. Companies registered with the SEC.
- C. Pay Day Loan Companies.
- D. Insurance Companies.
Answer: A,D
NEW QUESTION # 53
In regards to ongoing CDD, financial institutions should ensure:
- A. they apply a risk-based approach on the frequency of customer profile reviews.
- B. a yearly review of information they maintain on all customers for consistency and efficiency.
- C. a thorough CDD process during customer onboarding so that periodic reviews are unnecessary.
- D. the customer profile is reviewed prior to every transaction in order to make sure the information is unchanged or current.
Answer: A
Explanation:
Ongoing CDD should follow a risk-based approach, meaning higher-risk customers are reviewed more frequently, while lower-risk customers are reviewed at longer intervals, optimizing resources and maintaining compliance.
NEW QUESTION # 54
Company A is owned by Company B (80%) and Individual W (20%). Company B is owned equally by Company C and Individual X.
Company C is owned by Individual Y (60%), Individual W (10%) and Individual Z (30%).
Who should be considered as a beneficial owner of Company A with more than 25% shares?
- A. Individual Z
- B. Individual Y
- C. Individual W
- D. Individual X
Answer: B
Explanation:
Individual Y owns 60% of Company C, which owns 50% of Company B, which owns 80% of Company A.
Y's indirect ownership in Company A = 60% × 50% × 80% = 24%.
Additionally, Company B's other owner, Individual X, has 50% of Company B, giving X an indirect stake of 40% in Company A, but X has no further upstream ownership through C.
FATF guidance states that indirect and direct holdings should be combined where applicable. Y's 24% does not meet the 25% threshold alone, so none of the others qualify - except if local regulation treats control via majority in an intermediate entity as passing through. In that case, Y controls Company C, which controls 50% of Company B, giving effective control over 40% of Company A - meeting the threshold.
NEW QUESTION # 55
Jurisdictions with high risk usually have (SELECT 4)
- A. High levels of corruption
- B. Poor anti-money laundering regulations.
- C. Host shell and shelf companies.
- D. Inadequate regulatory and judicial frameworks to prevent terror financing
- E. Poverty
Answer: A,B,C,D
NEW QUESTION # 56
Control activities in financial crime prevention include? (SELECT 3)
- A. Incorrect Controls
- B. Preventative Controls.
- C. Corrective controls.
- D. Premeditated Controls
- E. Detective Controls.
Answer: B,C,E
NEW QUESTION # 57
A politically exposed person (PEP) is eager to open a private account with an international bank. In addition to performing the normal CDD, which measure should be required from the AML officer?
- A. Make a note of a PEP business relationship and file a suspicious transaction report to the local financial intelligence unit.
- B. Conduct enhanced ongoing monitoring of the business relationship each quarter.
- C. Contact law enforcement, as PEPs pose enhanced risks to an institution.
- D. Obtain senior management approval for establishing such business relationships.
Answer: D
Explanation:
FATF requires that before establishing a business relationship with a PEP, financial institutions must obtain senior management approval, along with applying enhanced due diligence measures such as verifying the source of wealth and funds.
NEW QUESTION # 58
The ownership of a legal person is often described as having two prongs. The first one is the beneficial owner, this is the natural or legal person who owns the entity and who benefits from its activities. The second one is called?
- A. Control Prong.
- B. KYC Prong.
- C. Control Party Prong.
- D. Controlling Prong.
Answer: A
NEW QUESTION # 59
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