Historically, a tour guide has made monthly cash deposits averaging $10,000. Over the past three months, the monthly deposits have averaged $100,000. When the financial institution the tour guide…

Question

Options

• AImmediately terminate the relationship
• BSchedule a periodic review of activity
• CPerform further investigation, it appropriate report the activity to the authorities and consider
• DPerform further investigation, if appropriate report the activity to the authorities and place a limit

• A
  4% (1)
• B
  7% (2)
• C
  78% (21)
• D
  11% (3)

Explanation

The financial institution should perform further investigation to verify the legitimacy of the tour guide's explanation and the source of funds. If the investigation reveals any suspicious or unusual activity, such as inconsistent cash flow patterns, involvement of high-risk customers or jurisdictions, or indications of money laundering or terrorist financing, the financial institution should report the activity to the authorities and consider terminating the relationship. The financial institution should also document the investigation and its findings, and update the customer's risk profile accordingly.

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