CAMS Question #218: Real Exam Question with Answer & Explanation

The correct answer is A. The country or location where the customer is from or does business B. The type and size of the business the customer runs C. The legal structure of the customer's business. A financial institution should examine the country or location where the customer is from or does business, the type and size of the business the customer runs, and the legal structure of the customer's business, because these factors can indicate the level of money laundering ri

Question

What are three factors a financial institution should examine with regard to a new customer who is opening up a new account? Choose 3 answers

Options

AThe country or location where the customer is from or does business
BThe type and size of the business the customer runs
CThe legal structure of the customer's business
DThe previous financial institutions where the customer has banked

Explanation

A financial institution should examine the country or location where the customer is from or does business, the type and size of the business the customer runs, and the legal structure of the customer's business, because these factors can indicate the level of money laundering risk associated with the customer. For example, some countries or locations may have weak anti- money laundering laws or high levels of corruption, some types or sizes of businesses may be more prone to generating or concealing illicit funds, and some legal structures may be more complex or opaque than others, making it harder to identify the beneficial owners or controllers of

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