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CAMS · Question #85

CAMS Question #85: Real Exam Question with Answer & Explanation

The correct answer is D. Each of their transactions is just below the cash reporting threshold. This involves breaking down large amounts of cash into smaller transactions that are below the reporting threshold of $10,000 in the United States, in order to avoid detection and reporting by the financial institution. Structuring is a red flag for money laundering and should be

Question

The anti-money laundering compliance officer for a small money transmitter has several agent locations in the same geographic area in the United States. The customers are immigrants from Country A and the majority of the funds are remitted to Country A. In a meeting with one of the agents, it is recently discovered that two new customers have been coming in three times a week and sending funds to the same recipient in Country B. Each cash transaction always totals exactly $8,000. What should alert the agent to possible money laundering activity by the two customers?

Options

  • AThey remit funds to the same person
  • BThey have been coming in three times a week
  • CIt is unusual for customers to remit to Country B
  • DEach of their transactions is just below the cash reporting threshold

Explanation

This involves breaking down large amounts of cash into smaller transactions that are below the reporting threshold of $10,000 in the United States, in order to avoid detection and reporting by the financial institution. Structuring is a red flag for money laundering and should be reported to the authorities as a suspicious activity. The other options are not necessarily indicative of money laundering, as they could have legitimate explanations. For example, the customers may have a family or business connection to the same recipient in Country B, or they may have a regular need to send money three times a week.

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