CAMS · Question #555
After several months of research, the Director of Marketing and the Managing Director of Business Development received approval to launch a branded, stored-value card that will be marketed to the…
The correct answer is D. During product development to perform a risk assessment of the product. The anti-money laundering officer should advise the bank that compliance should have been involved during product development to perform a risk assessment of the product. This is because stored-value cards are considered high-risk products for money laundering and terrorist…
Question
After several months of research, the Director of Marketing and the Managing Director of Business Development received approval to launch a branded, stored-value card that will be marketed to the diverse, primarily non-resident population that comprises the bank's current customer demographics. The Chief Credit Officer and the Risk Officer have also been involved in the efforts to develop the card. After the card is launched, the anti-money laundering officer is consulted. The anti-money laundering officer should advise the bank that compliance should have been involved
Options
- AAfter product development to confer with the legal department.
- BAfter product development to perform an assessment of the product.
- CDuring product development to develop reports for the Board.
- DDuring product development to perform a risk assessment of the product.
How the community answered
(22 responses)- A5% (1)
- B9% (2)
- C9% (2)
- D77% (17)
Explanation
The anti-money laundering officer should advise the bank that compliance should have been involved during product development to perform a risk assessment of the product. This is because stored-value cards are considered high-risk products for money laundering and terrorist financing, as they can be used to store, transfer, or access funds anonymously, across borders, or through third parties. A risk assessment would help the bank identify and mitigate the potential vulnerabilities and threats associated with the product, such as customer due diligence, transaction monitoring, record keeping, reporting, and training. A risk assessment would also help the bank comply with the regulatory requirements and expectations for offering such products, as well as the industry best practices and standards.
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