CAMS Exam Dumps - Certified Anti-Money Laundering Specialist (CAMS7 the 7th edition)

The Financial Action Task Force (FATF) is the global standard-setter for AML/CFT and counter-proliferation financing. Its mandate is focused on standard-setting, assessment, and international coordination, not enforcement or prosecution.

One of FATF’s primary functions is developing international standards, known as the FATF Recommendations, which form the basis of national AML/CFT regimes worldwide.

FATF also identifies high-risk and non-cooperative jurisdictions with strategic AML/CFT deficiencies and works with them to address these weaknesses. Public identification encourages reform and enhances global financial integrity.

Additionally, FATF maintains strong engagement with international organizations, regional bodies, and the private sector to promote consistent implementation of standards.

FATF does not prosecute countries or suspend membership based on evaluation outcomes.

Early surrender of a policy can be used to quickly access and integrate illicit funds, while funding an insurance policy with cryptocurrencies or other non-fiat currencies can obscure the source of funds, both of which are recognized money laundering risk factors in insurance products.

Shell companies and other high-risk business structures are commonly associated with money laundering schemes designed to obscure ownership and transaction purpose. FATF guidance identifies several red flags indicative of such misuse.

A mismatch between goods or services and the company’s stated business profile suggests fictitious or manipulated transactions. Insufficient information on originators or beneficiaries of funds transfers further increases suspicion, as transparency is a core AML requirement. Additionally, payments lacking a clear purpose or meaningful description may indicate layering or attempts to conceal illicit activity.

Conversely, well-documented transactions with established partners and legitimate audit trails are indicators of lower risk. While structuring below reporting thresholds can be suspicious, it must also be inconsistent with standard business practices to qualify as a red flag.

C: “The system must be adequate and proportionate to the bank’s size, activities, complexity, and risk profile. A one-size-fits-all solution is not appropriate.”

D: “Effective monitoring systems should support the detection of unusual trends and business relationships, facilitating meaningful analysis and alerts.”(CAMS 6th Edition, Transaction Monitoring System Requirements)

Incorrect:

A: Vendor internal controls are important, but not a top selection criterion for AML system effectiveness.

B: Permissions should be appropriate for the bank’s structure, not just compared to other banks.

Fuzzy logic in customer screening systems is used to handle uncertainty and variability in data by producing outputs that include a range of intermediate possibilities between "Yes" and "No." This enables the system to identify potential matches that are not exact but still relevant, improving the detection of name variations and misspellings.

The CAMS 6th Edition highlights that a risk-based approach enables organizations to efficiently allocate compliance resources, focusing efforts on areas presenting the highest risk, thereby ensuring both regulatory compliance and operational effectiveness.

“A risk-based approach allows firms to concentrate resources and controls where the risk of ML/TF is highest, while applying simplified measures to lower-risk areas. This enhances both effectiveness and efficiency.”

(CAMS 6th Edition, AML Compliance Program: Risk-Based Approach)

Incorrect Options:

A: Cost savings may occur, but it is not the main advantage.

B: Audits may still be required, just less frequently for low-risk customers.

D: Risk-based approaches are tailored, not standardized, across regions.