Which are the two most common controls a financial institution (FI) uses to identify suspicious money-laundering activity? (Choose two.)

Question

Options

• ASanctions screening
• BAdverse media information
• CGovernmental subpoena
• DSearch warrant
• ETransaction monitoring rules

• A
  78% (42)
• B
  7% (4)
• C
  13% (7)
• D
  2% (1)

Explanation

Sanctions screening and transaction monitoring rules are two of the most common controls that FIs use to identify suspicious money-laundering activity. Sanctions screening is the process of checking customers, transactions, and counterparties against various lists of sanctioned individuals, entities, and countries issued by national and international authorities. Sanctions screening helps FIs to avoid doing business with or facilitating the activities of those who are involved in terrorism, proliferation, human rights violations, or other criminal activities. Transaction monitoring rules are the criteria or scenarios that FIs use to detect unusual or potentially suspicious patterns of transactions or behaviors of customers or accounts. Transaction monitoring rules help FIs to identify transactions that deviate from the expected norms, such as large cash deposits, frequent wire transfers, or transactions with high-risk jurisdictions. Transaction monitoring rules also help FIs to comply with their reporting obligations, such as filing Suspicious Activity Reports (SARs) or Currency Transaction Reports (CTRs).

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