CAMS · Question #552
A compliance officer at a small local bank reads in the newspaper that a high ranking local public official, who is a long-standing account holder, is being investigated by the competent authorities…
The correct answer is C. Meet with staff who opened the account to understand its nature and purpose. One of the key steps in conducting an effective investigation of a potential money laundering or terrorist financing activity is to gather all relevant information about the customer and the transaction, including the nature and purpose of the account, the source and…
Question
A compliance officer at a small local bank reads in the newspaper that a high ranking local public official, who is a long-standing account holder, is being investigated by the competent authorities for accepting bribes from a well-known construction company with offices in the town. The compliance officer immediately checks the official's account and other recently opened accounts at the bank. The official opened a new account at the bank a few weeks ago. The compliance officer's investigation of these accounts discloses that the official's longstanding account had no unusual activity and the recently opened account had no activity since it was opened. Which of the following should the compliance officer do next?
Options
- AWait until the new account receives funds and confirm their source.
- BCall the competent authorities to assess the need to file a suspicious transaction report.
- CMeet with staff who opened the account to understand its nature and purpose.
- DCall the official's office to confirm the need for multiple accounts.
How the community answered
(59 responses)- A3% (2)
- B7% (4)
- C76% (45)
- D14% (8)
Explanation
One of the key steps in conducting an effective investigation of a potential money laundering or terrorist financing activity is to gather all relevant information about the customer and the transaction, including the nature and purpose of the account, the source and destination of funds, the expected account activity, and the customer's risk profile. In this case, the compliance officer should meet with the staff who opened the new account for the public official to obtain this information and assess whether the account is consistent with the customer's profile and needs, or whether it indicates a possible attempt to conceal or launder illicit funds. Waiting for the new account to receive funds, calling the competent authorities, or calling the official's office are not appropriate actions at this stage, as they may compromise the investigation, alert the customer, or violate confidentiality rules.
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