Which situation is the highest risk for money laundering and terrorist financing activity?

Question

Options

• AA customer purchases casino chips, using small denomination bank notes, but does not engage
• BA customer purchases casino chips and engages in significant game play before requesting a
• CA customer purchases casino chips using a credit card and engages in minimal game play before
• DA customer purchases casino chips using credit from an account at an affiliated casino and

• A
  84% (27)
• B
  3% (1)
• C
  3% (1)
• D
  9% (3)

Explanation

According to the Anti-Money Laundering Specialist (the 6th edition) resources, the situation that is the highest risk for money laundering and terrorist financing activity is A. A customer purchases casino chips, using small denomination bank notes, but does not engage in game play before redeeming the chips for a casino check. This is because this situation may indicate some red flags of money laundering, such as: Using small denomination bank notes, which may be an attempt to avoid detection or reporting by the casino or the authorities, as large amounts of cash are usually associated with criminal activity. Not engaging in game play, which may indicate a lack of interest in gambling and a sole purpose of exchanging cash for a casino check, which is a more legitimate and less traceable form of payment. Redeeming the chips for a casino check, which may be a way of laundering the cash through the casino, as the check can be deposited into a bank account or cashed at another location, without revealing the source of the funds.

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