ACFCS Financial Crime Specialist Sample Questions:

1. Mr. X is a business consultant who specializes in helping European companies expand their operations into Latin America. You are part of a law enforcement unit investigating Mr. X who is under suspicion of assisting his clients to conceal bribe payments made to government officials in Latin American countries.
Mr. X is knowntocontrol a numberofdifferent companies andtheirrelated subsidiaries within severalLamAmerican countries. You are tracing (fundsthat originated from an account held by one of Mr.X's companies in the UK in an effort to establish that he is involved in the corruption and money laundering scheme.
Which would provide the BEST indicatorThatMr.X is helping to launder funds connected to bribery?

A) Funds whose source can be traced to a corporate account in a country located in the European Union
B) Funds transferred to business associates of Mr.X located in the European Union
C) Funds that are being used in the operation of a business in ahigh-riskjurisdiction
D) Funds transferred into the account from a nondescript business with little information available about it

2. An international construction company was bidding on a large contract to redevelop and modernize a hydroelectric power system in a central Asian country. Theprojectwas being administered by an agency in the country's federal government but federal officials directed the company to contact a number of local officials for additional details on the project and its scope The company later wins its bid for the redevelopment contract and completes the protect.
A year later an internal auditor is conducting a routine review of past projects and notices certain irregularities in the bidding process for Ihe power system redevelopment. All of the company's major competitors had been rejected in the first round of bidding despite offering competitive pricing of the other firms considered in later rounds of bidding most were small companies and several were incorporated recently in the country where the project was taking place All of them put in bids that were higher or much lower than the company's winning bid.
The auditor is concerned that these unusual findings may indicate the company won its bid through a corruption scheme involving government officials. Which further finding BEST supports this possibility?

A) The company s total costs for the project came in at 3% higher than the estimated costssubmittedduringthe bidding process
B) The company won the bid and then subcontracted work to several of the smaller local firmsthathad also submitted bids
C) At least one of the companies that submitted a competing bid appears to be a sole proprietorship incorporated in another country
D) Officials from the federal agency appeared to have limited contact with the local officials during the bidding process

3. During a risk assessment of its trade finance operations, XYZ Bank identifies a high volume of transactions involving shell companies with obscure ownership structures. What is the most appropriate action for XYZ Bank to take in response to this finding?

A) Seek approval from senior management to continue trade finance operations.
B) Conduct enhanced due diligence on transactions involving shell companies.
C) Immediately terminate all trade finance operations involving shell companies.
D) Ignore the issue as long as the transactions are compliant with regulatory requirements.

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

5. During a risk assessment of its correspondent banking relationships, a financial institution discovers that one of its correspondent banks operates in a high-risk jurisdiction known for weak anti-money laundering (AML) controls. What is the most effective approach for the institution to manage the risks associated with this correspondent banking relationship?

A) Increase the frequency of audits conducted at the correspondent bank's premises.
B) Limit the types of transactions conducted with the correspondent bank to reduce exposure to risks.
C) Immediately terminate the correspondent banking relationship with the bank operating in the high-risk jurisdiction.
D) Conduct enhanced due diligence on transactions involving the correspondent bank.

Solutions: