CAMS · Question #69
A bank is preparing for its anti-money laundering independent review, which is performed every two years under the direction of the compliance officer. The bank's corporate audit department will…
The correct answer is C. The final report must be presented directly to the board of directors. The method of purchasing chips with cash and redeeming them for a check is used to launder money in casinos. This is because the check can be deposited into a bank account or cashed at another location, creating a paper trail that appears to be legitimate. The check can also be…
Question
A bank is preparing for its anti-money laundering independent review, which is performed every two years under the direction of the compliance officer. The bank's corporate audit department will conduct the review. The compliance officer will review the final report before it is released to the Board of Directors. What is the issue with this situation?
Options
- AIndependent reviews must be performed annually
- BThe review must be performed by a group outside of the bank
- CThe final report must be presented directly to the board of directors
- DThere is a conflict of interest with the management of the review process
How the community answered
(50 responses)- A4% (2)
- B16% (8)
- C72% (36)
- D8% (4)
Explanation
The method of purchasing chips with cash and redeeming them for a check is used to launder money in casinos. This is because the check can be deposited into a bank account or cashed at another location, creating a paper trail that appears to be legitimate. The check can also be used to conceal the source and amount of the cash, as well as the identity of the person who obtained it. This method is also known as "chip washing" or "chip dumping" and is one of the common ways that money launderers exploit casinos.
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