CAMS · Question #334
In performing a risk analysis, which factor(s) should a financial institution review?
The correct answer is C. Its customer base, location, products and services. these are the main factors that determine the inherent money laundering risk of a financial institution. The customer base, location, products and services of a financial institution affect the type, volume, and complexity of transactions that it processes, as well as the…
Question
In performing a risk analysis, which factor(s) should a financial institution review?
Options
- AThe level of its gross revenue
- BRecent regulatory actions against financial institutions of comparable size
- CIts customer base, location, products and services
- DThe adequacy and completeness of its STR filings
How the community answered
(34 responses)- A6% (2)
- B3% (1)
- C76% (26)
- D15% (5)
Explanation
these are the main factors that determine the inherent money laundering risk of a financial institution. The customer base, location, products and services of a financial institution affect the type, volume, and complexity of transactions that it processes, as well as the exposure to high- risk customers, jurisdictions, and activities. A financial institution should review these factors regularly and conduct a comprehensive risk assessment to identify, measure, and mitigate its money laundering risk.
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