A customer has borrowed the cash surrender value of their life insurance policies. Which requires a further investigation and filing of the suspicious activity report?

The correct answer is C. The customer directs the payment of the money borrowed to an unrelated third party. The customer directing the payment of the money borrowed to an unrelated third party is a red flag for potential money laundering, as it could indicate layering or integration of illicit funds. The other options are not necessarily indicative of money laundering, although they…

Risks and Methods of Money Laundering and Terrorist Financing

Question

Options

AThe customer uses multiple currency equivalents from different sources to pay the monthly life
BThe customer has paid the monthly life insurance policy premiums with cash.
CThe customer directs the payment of the money borrowed to an unrelated third party.
DThe customer cancels the insurance contract without concern for the penalties after the money is

How the community answered

(45 responses)

A
7% (3)
B
4% (2)
C
78% (35)
D
11% (5)

Explanation

The customer directing the payment of the money borrowed to an unrelated third party is a red flag for potential money laundering, as it could indicate layering or integration of illicit funds. The other options are not necessarily indicative of money laundering, although they could warrant further monitoring or due diligence depending on the customer profile and risk assessment.

Topics

#life insurance#money laundering typologies#third-party payments#SAR triggers

Community Discussion

No community discussion yet for this question.

Full CAMS Practice