CAMS · Question #709
Which of the following measures is one that the FATF recommends that Financial Institutions (FIs) and Designated Non-Financial Businesses and Professions (DNFBPs) take to mitigate risks arising from…
The correct answer is D. Establish processes to understand the PEP's source of wealth and source of funds, and to refresh. PEPs pose higher risks for corruption and money laundering, requiring enhanced due diligence Option D (Correct): Understanding a PEP's source of wealth and funds ensures legitimacy of
Question
Which of the following measures is one that the FATF recommends that Financial Institutions (FIs) and Designated Non-Financial Businesses and Professions (DNFBPs) take to mitigate risks arising from business relationships with foreign politically exposed persons (PEPs)?
Options
- ASubscribe to commercial databases to assist in the detection of PEPs.
- BRaise transaction monitoring thresholds for PEP accounts in automated systems to account for
- CRequire approval from the prudential regulator for entering into or continuing the business
- DEstablish processes to understand the PEP's source of wealth and source of funds, and to refresh
How the community answered
(52 responses)- A2% (1)
- B6% (3)
- C12% (6)
- D81% (42)
Explanation
PEPs pose higher risks for corruption and money laundering, requiring enhanced due diligence Option D (Correct): Understanding a PEP's source of wealth and funds ensures legitimacy of
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