When investigating apotentially suspicious cross-border payment, a financial institution should followrisk- based due diligence procedures.
* Option B (Correct):Sanctions screeningis critical to ensure theoriginator or beneficiaryisnot listed on OFAC, EU, UN, or other sanctions lists.
* Option C (Correct):Requestingsupporting documents(e.g., invoices, contracts) helps determine whether the transaction isconsistent with the customer's profile.
* Option D (Correct):Conductingnegative news (adverse media) checkshelps identifyfinancial crime risks, such as fraud or money laundering.
* Option A (Incorrect):Banksdo not directly calltransaction recipients unless there is a clear suspicion requiring customer verification.
* Option E (Incorrect):314(b) requestsunder theUSA PATRIOT Actallow information sharing among
U.S. financial institutions butcannot be used for foreign banks.
Reference:FATF Recommendation 13 (Correspondent Banking), Wolfsberg Group Correspondent Banking Due Diligence, USA PATRIOT Act Section 314(b).

Banks mustcomply with legal subpoenaswhile ensuring AML compliance.
* Option B (Correct):The bank shouldreview client transactionsandrespond fullyto law enforcement.
* Option A (Incorrect):Filing a SAR simply because of a subpoenaisnot requiredunless suspicious activity is identified.
* Option C (Incorrect):Tipping offthe client about the subpoena isillegalunder AML laws.
* Option D (Incorrect):Risk scores should be reviewedbut not automatically adjustedsolely based on a subpoena.
Reference:U.S. Bank Secrecy Act (BSA) Subpoena Compliance Rules, FATF Recommendation 40 (International Cooperation).

The board of directors has the ultimate responsibility within a bank for ensuring that the bank has a comprehensive and effective BSA/AML program and oversight framework that is reasonably designed to ensure compliance with applicable regulations. According to the Federal Financial Institutions Examination Council (FFIEC) BSA/AML Examination Manual, the board of directors must approve the BSA/AML compliance program, which includes the BSA/AML policy, internal controls, independent testing, designatedBSA/AML compliance officer, and training1. The board of directors must also provide sufficient resources, ensure qualified staff, and hold senior management accountable for implementing and adhering to the BSA/AML compliance program1.
:
1: FFIEC BSA/AML Examination Manual, Board of Directors and Senior Management Oversight

Trade-based money laundering (TBML) is a method to finance terrorism that involves falsifying transaction- related documents, such as invoices, contracts, bills of lading, or customs declarations, to conceal the origin, destination, value, or purpose of illicit funds. TBML can be used to move money, goods, or services to or from sanctioned orhigh-risk jurisdictions, to evade taxes, duties, or currency controls, to launder proceeds of crime, or to support terrorist activities. TBML can involve over- or under-invoicing, over- or under-shipping, multiple-invoicing, or falsely describing goods or services. TBML can also be linked to other methods of money laundering or terrorist financing, such as bribery, black market peso exchange, or informal value transfer systems.
:
ACAMS CAMS Certification Video Training Course, Module 2: Compliance Standards for Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT), Lesson 4: Trade-Based Money Laundering Money Laundering and Terrorist Financing Related to Counterfeiting of Currency, Financial Action Task Force (FATF), page 28 Tracing terrorist finances, INTERPOL

A financial institution (FI) should exit a relationship when the suspicious conduct of the account holder or the FI's stated policies and procedures for closing an account warrant such action. A FI has the right and responsibility to terminate a customer relationship that poses an unacceptable level of risk to the FI or violates its AML/CFT program. A FI should have clear and consistent criteria for exiting a relationship, such as the number and severity of SARs filed, the nature and extent of due diligence conducted, the availability and effectiveness of mitigating controls, and the alignment of the customer profile with the FI's risk appetite. A FI should also document the rationale and process for exiting a relationship, communicate the decision to the customer and relevant stakeholders, and monitor the account until closure.
The reputational risk to the FI posed by closing the account or the request from law enforcement to close the account are not valid reasons for exiting a relationship by themselves. A FI should consider the potential reputational impact of closing an account, but it should not outweigh the legal and regulatory obligations of the FI to prevent and detect money laundering and terrorist financing. A FI should also cooperate with law enforcement requests, but it should not automatically close an account based on such requests, as they may interfere with ongoing investigations or intelligence gathering. A FI should exercise its own judgment and discretion in deciding whether to exit a relationship, based on its own policies and procedures and the facts and circumstances of each case.
:
Exiting Relationships: Ten Steps to a Successful Client Exit Strategy
De-risking your SARs: Building SAR relationship exit strategies into your AML/CFT program Answers to Frequently Asked Questions Regarding Suspicious Activity Reporting and Other Anti-Money Laundering Considerations