CAMS Question #126: Real Exam Question with Answer & Explanation

Question

Options

• AHaving signature authority over the account
• BBeing the person in whose name an account is opened with a financial institution
• CHaving control over such funds or entitlement to such funds
• DBeing a person who is the trusted party in a correspondent banking relationship

Explanation

According to the FATF Recommendations, the international standard for anti-money laundering and counter-terrorist financing, beneficial owners are the natural persons who ultimately own or control a customer or the natural persons on whose behalf a transaction is being conducted1 The beneficial ownership criterion is not based on the legal title or the nominal ownership of the funds, but on the effective control or the ultimate entitlement to the funds. Therefore, having signature authority over the account, being the person in whose name an account is opened, or being a trusted party in a correspondent banking relationship are not sufficient to determine the beneficial ownership of funds. These may be indicators of legal ownership or nominee arrangements, but they do not necessarily reflect the true ownership or control of the funds. The most effective criterion for determining the beneficial ownership of funds is having control over such funds or entitlement to such funds, either directly or indirectly, through ownership, voting rights, contractual agreements, trusts, or other means.

No community discussion yet for this question.