CAMS Question #5: Real Exam Question with Answer & Explanation

Question

Options

• ADepositing illicit funds into an account set up for a front company
• BDirecting third parties to exchange illicit cash for negotiable instruments
• CWiring illicit funds from an account at one bank to an account at another bank
• DUsing illicit funds that had previously been deposited to purchase a luxury vehicle

Explanation

The integration stage of money laundering is where the illicit funds are reintroduced into the legitimate financial system, making them appear as lawful income or assets. This may include using multiple accounts, transferring funds between different banks or jurisdictions, and engaging in various financial activities to legitimize the illicit funds. The integration stage aims to make the illicit funds appear legitimate and indistinguishable from lawful funds within the financial system. Option C is an example of the integration stage of money laundering involving a bank or another deposit-taking institution, as it involves moving the illicit funds from one bank account to another, creating a complex trail of transactions that obscures the origin and ownership of the funds. This technique is also known as wire transfer laundering or electronic funds transfer laundering.

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