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CRB: Anti-Money Laundering and Financial Crime Compliance

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Anti-Money Laundering and Financial Crime Compliance

What this domain tests

This domain tests the Bank Secrecy Act and AML program requirements, customer due diligence, beneficial ownership, currency and suspicious activity reporting, sanctions compliance, and independent testing. Questions often turn on thresholds, aggregation, escalation, and the distinction between a control weakness and a reportable event.

Core rules and concepts

  • A BSA/AML program generally requires a risk assessment, written policies, a designated BSA officer, training, customer due diligence, ongoing monitoring, and independent testing.
  • CIP requires identity verification at account opening. CDD requires understanding the customer relationship and expected activity. Beneficial ownership rules generally require identifying individuals who own 25% or more and one control person.
  • CTRs are required for currency transactions over USD 10,000 in one business day, including known multiple transactions. SARs are required for suspicious transactions at or above USD 5,000 for banks, and for certain suspicious activity regardless of amount under applicable rules.
  • OFAC sanctions are strict liability. Screening must cover customers, counterparties, and transactions, with blocking and reporting obligations.
  • Information sharing under Section 314(a) and 314(b) has different purposes and protections.

Worked example

A business deposits USD 6,000 in cash at 10:00 and USD 5,500 at 15:00. The total is USD 11,500 in one business day. Because the bank knows or has reason to know the transactions are by or for the same customer, it must aggregate them and file a CTR. If the customer made repeated deposits just below USD 10,000 to evade reporting, the bank should also evaluate a SAR for structuring. The CTR is not optional because each individual deposit was below the threshold; aggregation controls.

Traps that cost marks

  • Failing to aggregate same-day currency transactions.
  • Treating the SAR threshold as a safe harbor for suspicious activity below USD 5,000.
  • Disclosing a SAR to the customer; tipping off is prohibited.
  • Applying a one-size-fits-all monitoring rule instead of a risk-based approach.
  • Confusing OFAC blocking with SAR filing; they are separate obligations.