Module 4 (Part 1

Question 1

What does module 4 cover

Answer 1

conducting and responding to investigations

Question 2

what are 6 common aml/cft investigation initiators

Answer 2

1. Regulatory recommendations or official findings
2. transaction monitoring
3. referrals from customer-facing employees
4. internal hotlines
5. negative media information
6. receipt of a governmental subpoena or search warrant

Question 3

what is the deal with transaction monitoring rules

Answer 3

should be reviewed at a regular cadence and tuned accordingly to ensure they operate as designed (think SOAR)

Question 4

what may tuning practices include

Answer 4

evaluating the output of monitoring rules, examining specific thresholds and conducting above and below-the-line testing to determine whether rule adjustments are necessary

Question 5

what is difference between subpoena and search warrant

Answer 5

subpoenas are usually issued by grand juries

warrants are submitted to a court by a LEO via an affidavit stating there is PC that evidence of a crime will be located.

Question 6

what are the two obligations of a financial institution if they receive a subpoena or a warrant

Answer 6

1. legally fulfill the requirements of the subpoena or warrant
2. determine whether the activity of its customer identified in the subpoena or warrant requires the filing of a STR

Question 7

What are the 4 steps into conducting an effective financial investigation

Answer 7

1. Reviewing internal transactions, info from the customer and other relevant internal documentation
2. Identifying and review external information to understand the customer, related entities, and relevant media
3. contacting business line employees responsible for the account relationship
4. generating a written report documenting relevant findings

Question 8

What does STR stand for

Answer 8

Suspicious Transaction Report

Question 9

What should be drafted regarding STRs

Answer 9

procedures that document the factors to consider when determining whether to file an STR

Question 10

What should a financial institution do once it has decided on filing an STR

Answer 10

ensure that the STR filing includes not only

1. the details f the suspicious activity and the related demographics
2. why the institution finds the activity suspicious

Question 11

Based on the internal investigation, the financial institution should do what

Answer 11

make an INDEPENDENT DETERMINATION

Question 12

as to what

Answer 12

whether to close the account in issue

Question 13

what are 5 factors the institution should consider

Answer 13

1. The legal basis for closing an account
2. the reputational risk to the institution posed by maintaining the account
3. the institution’s stated policies and procedures for closing an account.
4. correspondence with law enforcement and requests from law enforcement to either cancel or maintain the account.
5. the seriousness of the underlying conduct

Question 14

what are the 8 factors to consider in decision making when considering whether to bring a case against an institution

Answer 14

1. The institution has a criminal history
2. The institution has had a comprehensive and effective AML/CFT program
3. Deterring wrongdoing by others is needed and will be served by a prosecution
4. The institution has cooperated with the investigation
5. The institution has taken timely and effective remedial action
6. Advice and recommendations from regulatory agencies and or the fiu for the jurisdiction are available
7. the institution discovered and self reported the money laundering related issues
8. there are civil remedies available that can serve as punishment

Question 15

What should happen when responding to law enforcement investigations

Answer 15

the financial institution should designate some one to

Question 16

to what

Answer 16

1. respond to all law enforcement requests
2. monitor the progress of the investigation
3. keep senior management informed of the nature and progress of the investigation

Question 17

what if evidence is required from another jurisdiction

Answer 17

a request can be made for MUTUAL LEGAL ASSISTANCE

Question 18

what provides a legal basis for transmitting evidence that can be used for prosecution and judicial proceedings

Answer 18

Mutual Legal Assistance Treaties

Question 19

What are financial intelligence units

Answer 19

mandatory national agencies that handle financial intelligence

Question 20

what are the 3 ways the FIU contributes towards combatting money laundering

Answer 20

1. Receiving report of suspicious transactions from financial institutions and other persons and entities
2. Analyzing the reported suspicious transactions
3. Disseminating the resulting intelligence to local law enforcement agencies and foreign FIUs

Question 21

What do the “Principles of Information Exchange” describe

Answer 21

practices that maximize cooperation between FIUs and can be useful to government authorities when considering AML legislation

Question 22

What is the deal with reciprocity and spontaneous exchange

Answer 22

The Egmont Principle of free exchange of information at the FIU level should be possible on the basis of reciprocity, including spontaneous exchange

Question 23

What should not be an obstacle to free exchange of information at the FIU level

Answer 23

Differences in the definition of offenses

Question 24

What is the deal with informal and rapid info exchange

Answer 24

the exchange of information should take place as informally and as rapidly as possible and with no excessive formal prerequisites

Question 25

while guaranteeing what

Answer 25

protection of privacy and confidentiality of the shared data

Question 26

What if an FIU still needs a memorandum of understanding (MOU)

Answer 26

it should be negotiated and signed by the FIU without undue delay

Question 27

so what does this mean

Answer 27

the FIU should have the authority to sign MOUs independently

Question 28

are intermediaries necessary?

Answer 28

no, it should be possible for communication between FIUs to take place directly and without intermediaries

Question 29

what about providing consent

Answer 29

providing FIU's consent to disseminate the information for law enforcement or judicial purposes should be granted promptly and to the greatest extent possible