You are a compliance officer for a bank that provides services to a third-party payment processor. The processor facilitates credit card payments for online and physical retail stores located within your own country.
You conducted enhanced due diligence on the client when the account was originally opened two years ago.
Since then, periodic reviews have noted no changes in the client s operations ownership structure or other information.
Recently regulators in your country have issued penalties against other banks that had insufficient AML controls and monitoring on accounts held by payment processors Concerned, your legal department has asked you to review the client's risk status.
Which is the primary reason for your conclusion that the customer relationship is higher risk?

• A. The payment processor conducts credit card transactions
• B. The account relationship manager is reluctant to provide additional supporting documentation
• C. The bank does not have visibility into the activities of the processor's customers
• D. The retail stores served by the processor are not covered by AML regulations

You are an investigator in the compliance department of a bank in a border region. The country on the other side of the border has an active narcotics trade run by organized crime gangs operating on both sides of the border Recently, youhave become concerned your bank is being used by a narcotics gang to smuggle bulk cash out of your country.
Which evidence is Ihe strongest indicator that bulk cash smuggling is taking place?

• A. There has been a sudden increase in deposit transactions from a third-party domestic bank to your bank
• B. Accounts at your bank have made a large number of wire transfers lo offshore jurisdictions
• C. Your bank has increased transfers of large-denomination notes in your country's currency to banks across the border
• D. Your bank has logged a large number of transactions converting large denominations lo small denomination notes in its branches across the border

Mr. Johnson, a compliance officer at ABC Corporation, is conducting due diligence on a potential business partner based in a foreign country. During the due diligence process, Mr. Johnson discovers that the potential partner's principal shareholder is a politically exposed person (PEP) from a country subject to OFAC sanctions. What is the most appropriate action for Mr. Johnson to take?

• A. Seek guidance from OFAC on the permissibility of engaging with the potential partner.
• B. Proceed with the business partnership but disclose the involvement of the PEP to OFAC.
• C. Reject the business partnership due to the involvement of a PEP from a sanctioned country.
• D. Proceed with the business partnership but conduct enhanced monitoring of transactions involving the PEP.

A mid-size bank receives a S35 000 wire transfer request in an email from the chief financial officer (CFO) of one of the bank's business clients. The client's head of accounting was copied on the message An employee at the bank replied to the email with a wire transfer form and agreement for the client to complete.
The CFO replied with the signed and completed forms the bank began processing the wire transfer and as a routine measure called the number in the CFO's email signature to validate request. The bank received verbal confirmation to complete the transfer.
The next day a bank employee receives a call from the head of the clients accounting department inquiring about the $35,000 transfer believing it to be an error. The bank employee says that the transfer was initiated by the company CFO and produces the wire transfer forms. The head of accounting says that no such transfer was authorized and connects the bank with the CFO to confirm this Now believing the transaction to be fraudulent the bank starts an attempt to reverse the wire transfer.
Based on this information which is a weakness in the bank's cybersecurity program?

• A. The bank should have replied to the email and requested confirmation from the head of accounting in addition to the CFO
• B. The bank should have required a hard copy of the wire transfer agreement to be returned via fax before processing the wire
• C. The bank should have authenticated the request using contact information on file with the bank before processing the wire
• D. The bank should have scanned the completed wire transfer forms that the CFO attached to her email for malware used in account takeover schemes

Ms. Yu is a scammer based in Singapore who has spent the last several months promoting a fraudulent investment fund that purports to offer substantial returns on high-yield bonds. While she has been successful some investors have recently raised questions over a lack of details on the fund's portfolio and nature of the bonds.
Concerned that her securities fraud might be exposed. Ms. Yu is seeking to conceal assets and cover her tracks in the event of an investigation. She plans on creating one or more legal entities and utilizing them to move proceeds of the scheme out of the country.
Which country would be MOST attractive to Ms. Yu as part of this effort?

• A. A country that has not agreed to implement the Common Reporting System established by the Organization for Economic Cooperation Development (OECD)
• B. A country with a reputation for corruption among its government officials
• C. A country with a history of banking secrecy
• D. A country with anonymous company formation and no public accessible corporate register