A foreign bank operating under an offshore license wants to open a correspondent account with a United States (U.S.) bank. The foreign bank plans to provide payable through account services to some of its customers. What must the foreign bank provide to the U.S. bank under the USA PATRIOT Act?

1. A. A list of politically exposed persons who are owners of the correspondent bank
2. B. A list of account holders at the financial institution who will use the payable through account
3. C. The person in the United States who can receive service of legal process for the correspondent bank
4. D. A list of anti-money laundering training records for the financial institution employees monitoring payable through account transactions

Correct Answer: A

What are two requirements for monitoring and reporting suspicious activity for correspondent banking according to the Wolfsberg Principles? (Choose two.)

1. A. Incorporate suspicious activity monitoring into periodic reviews
2. B. Incorporate due diligence results such as customer risk ratings
3. C. Utilize downstream correspondents to investigate and report suspicious activity
4. D. Investigate and report suspicious activity only for the correspondent bank’s clients

Correct Answer: BC

Findings from a regulatory examination report states that the job descriptions of personnel outside of the compliance department do not include references to anti-money laundering responsibilities. Which action should the firm take?

1. A. Update all job descriptions to include anti-money laundering responsibilities
2. B. Respond that only compliance personnel have anti-money laundering responsibilities
3. C. Send an email to all staff stating that personnel must observe the anti-money laundering policy
4. D. Reply that a description of anti-money laundering responsibilities is included in the annual training

Correct Answer: D

Which two factors should increase the risk of a correspondent bank customer and require additional due diligence according to the Wolfsberg Anti-Money Laundering Principles for Correspondent Banking? (Choose two.)

1. A. The customer is located in a Financial Action Task Force member country and provides services primarily to a local individual customer.
2. B. The customer is located in a Financial Action Task Force member country and the bank’s head of information security is a politically exposed person.
3. C. The customer is located in a Financial Action Task Force member country and provides services to other correspondent banks in neighboring countries.
4. D. The customer is located in a non-Financial Action Task Force member country and services mostly commercial customers who engage in international trade.

Correct Answer: CD

The compliance officer for a bank is reviewing on-boarding documents for a new business account for a domestic corporation. The officer is unable to verify the identity of the beneficial owners of the company. Only information on the nominee owners was provided, and none of the listed addresses are local. The purpose of the business and future expected activity were disclosed to include cash letters, money orders and international remittance transfers.
Which red flag identifies a heightened money laundering risk?

1. A. Expected activity was advised to include cash letter and money orders
2. B. The nature and purpose of the business include international remittance transfers
3. C. The names provided at account opening are identified as the corporation’s representative nominees
4. D. Account signer’s government issued identification lists addresses outside of where the branch account was opened

Correct Answer: B