According to the Wolfsberg Anti-Money Laundering Principles for Private Banking (2012), the bank should have a clear policy on how to deal with intermediaries, such as lawyers, accountants, trust and company service providers, or other financial institutions, that introduce or manage clients on behalf of the bank. The policy should reflect the following aspects1:
* The bank should perform due diligence on the intermediary itself, including its ownership, reputation, regulatory status, and AML policies and procedures.
* The bank should obtain the identity and beneficial ownership information of the clients introduced or managed by the intermediary, and verify them using reliable and independent sources, unless there are legal or regulatory impediments to do so.
* The bank should assess the level of due diligence performed by the intermediary on its clients, and determine whether it is equivalent or comparable to the bank's own standards. If not, the bank should perform additional due diligence on the intermediary's clients, or decline to accept them.
* The bank should monitor the transactions and activities of the clients introduced or managed by the intermediary, and report any suspicious or unusual activity to the relevant authorities.
Option B is consistent with these aspects, as it states that the bank must obtain the same type of information with respect to an introduced client that would otherwise be obtained by the bank, absent the involvement of the intermediary. This ensures that the bank has a sufficient understanding of the client's identity, source of wealth, and risk profile, and can apply appropriate AML measures.
Option C is also consistent with these aspects, as it states that where an intermediary manages assets on behalf of a number of clients and is the account holder with the bank, but that intermediary does not conduct the same level of due diligence as the bank, it is necessary for the bank to undertake due diligence on the intermediary's clients. This ensures that the bank does not rely solely on the intermediary's due diligence, and can identify and mitigate any potential money laundering risks associated with the clients.
Option A is not consistent with these aspects, as it states that when an intermediary introduces clients to the bank, it is not necessary for the bank to perform due diligence on the intermediary's clients. This contradicts the principle that the bank should obtain and verify the identity and beneficial ownership information of the clients introduced by the intermediary, unless there are legal or regulatory impediments to do so.
Option D is also not consistent with these aspects, as it states that where an intermediary manages assets on behalf of a number of clients and arranges for the opening of accounts for its clients with the bank, and that intermediary is a financial institution subject to similar regulations, it is necessary for the bank to perform due diligence on the intermediary's clients. This contradicts the principle that the bank may rely on the due diligence performed by the intermediary on its clients, if the intermediary is a regulated financial institution that applies equivalent or comparable AML standards to the bank, and if the bank has access to the relevant information and documentation.
1: Wolfsberg Anti-Money Laundering Principles for Private Banking (2012), Section 3: Intermediaries

the U.S. government has the authority to seize and forfeit funds in a correspondent account of a non-U.S.
bank if the funds are involved in or traceable to a money laundering offense, regardless of where the offense occurred. This is based on the USA PATRIOTAct, which expanded the definition of "proceeds of specified unlawful activity" to include any property that is derived from or traceable to a foreign offense that would be a predicate offense if committed in the U.S12
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1: ACAMS Study Guide for the CAMS Certification Examination, 6th Edition, Chapter 4, page 137
2: USA PATRIOT Act, Title III, Section 319(b)

A domestic business account receiving a wire transfer from an international business with no history of such activity or business needs should be escalated as potentially suspicious activity. This is because this scenario may indicate an attempt to launder money, evade taxes, or finance terrorism through cross-border transfers that have no apparent economic or lawful purpose. The lack of prior relationship or business justification for the wire transfer may also suggest that the transaction is not consistent with the customer's profile or expected activity. Therefore, this scenario should be investigated further and reported if necessary.
9 Financial & Bank Suspicious Activity Examples, Example 2.
CAMS Study Guide 6th Edition, page 40-41.
Reference: https://www.utica.edu/academic/institutes/ecii/conferences/Conducting%20a%20Money%
20Laundering%20Investigation%20-%20C%20King.pptx

Identity theft is a form of fraud or cheating of identity in which someone wrongfully obtains and uses another person's personal data in some way that involves fraud or deception, typically for economic gain. By compromising an individual's personal data, such as their Social Security Number, bank account numbers, or other personal information, a cybercriminal can use it to gain access to credit cards or other financial accounts, or to open new accounts in the victim's name.

In theEuropean Union (EU), data protection laws (GDPR) and AML regulations (AMLDs) must be balancedwhen sharing customer data.
Option D (Correct):Data sharing must be"necessary, reasonable, and proportionate,"followingAML regulations and data protection requirements.
Option A (Incorrect):While data protection laws apply,AML/CFT regulations provide exemptionsfor legitimate investigations.
Option B (Incorrect):Aformal production orderis not always required if information sharing islegally permitted under AML regulations.
Option C (Incorrect):Privacy laws still apply, even in financial crime investigations. AML/CFT obligations donot override GDPRbut must be balanced appropriately.
Key Considerations in Cross-Border AML Data Sharing in the EU:
GDPR & AML Regulations Must Align:TheGeneral Data Protection Regulation (GDPR)protects customer privacy, but theEU Anti-Money Laundering Directives (AMLDs) require data sharing for AML purposes.
Proportionality Principle:Anydata shared must be strictly limited to what is necessaryfor AML purposes (e.g., transaction details but not unnecessary personal data).
Regulatory Guidance:Banks must comply withArticle 23 of GDPR, which allowsexceptions for AML compliance.
Why This Matters:
Failure toproperly balance AML compliance and data privacycan lead to:
Regulatory fines under GDPRfor data breaches.
AML penaltiesfor failing to cooperate in financial crime investigations.
Reference:
6th EU Anti-Money Laundering Directive (6AMLD)
General Data Protection Regulation (GDPR), Article 23
EBA Guidelines on AML and Data Sharing in the EU