CAMS · Question #862
A global financial institution is conducting a comprehensive review of its due diligence processes to strengthen its defenses against financial crime. Recent incidents have highlighted…
The correct answer is B. Establishing a surveillance program for employees, vendors, and third parties, including periodic. Establishing a surveillance program with periodic risk assessments, access controls, and regular compliance reviews for employees, vendors, and third parties is the most effective way to mitigate insider threats and ensure ongoing adherence to AML regulations. This proactive…
Question
A global financial institution is conducting a comprehensive review of its due diligence processes to strengthen its defenses against financial crime. Recent incidents have highlighted vulnerabilities related to employee misconduct, including unauthorized transactions and sharing of sensitive customer information. Additionally, the FI has faced issues with third-party vendors who failed to meet compliance standards, leading to increased regulatory scrutiny. Which of the following measures would be most effective in addressing the bank's due diligence needs for employees, vendors, and third parties to mitigate insider threats and ensure compliance with AML regulations?
Options
- ARelying on self-reported compliance certifications from vendors and employees to confirm
- BEstablishing a surveillance program for employees, vendors, and third parties, including periodic
- CImplementing background checks for employees and vendors prior to onboarding or the start of
- DLimiting the number of vendors and third parties in high-risk jurisdictions in order to reduce
How the community answered
(38 responses)- A11% (4)
- B79% (30)
- C8% (3)
- D3% (1)
Explanation
Establishing a surveillance program with periodic risk assessments, access controls, and regular compliance reviews for employees, vendors, and third parties is the most effective way to mitigate insider threats and ensure ongoing adherence to AML regulations. This proactive approach continuously monitors risk rather than relying solely on initial checks or self-certifications.
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