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Question

Difficulty: EasyAnti-Money Laundering (AML), KYC, and Sanctions Compliance

Match each Anti-Money Laundering (AML) or sanctions compliance regulation with its mandatory operational requirement.

  • Currency Transaction Report (CTR)Mandatory filing for cash deposits or withdrawals exceeding $10,000 in a single business day within 15 calendar days.
  • Suspicious Activity Report (SAR)Mandatory filing for questionable transactions of $5,000 or more within 30 calendar days, without notifying the client.
  • Customer Identification Program (CIP)Mandatory collection and verification of four key identity items (name, DOB, physical address, and SSN/TIN) before or shortly after account opening.
  • OFAC Sanctions List ScreeningMandatory requirement to block or freeze assets of individuals or entities listed on the Specially Designated Nationals (SDN) list.

Answer

Currency Transaction Report (CTR) matches cash transactions exceeding 10,000filedwithin15calendardays;SuspiciousActivityReport(SAR)matchesquestionabletransactionsof10,000 filed within 15 calendar days; Suspicious Activity Report (SAR) matches questionable transactions of 5,000 or more filed within 30 calendar days; Customer Identification Program (CIP) matches mandatory collection and verification of four customer identity items; OFAC Sanctions List Screening matches blocking assets on the SDN list.
Each anti-money laundering and compliance rule corresponds directly to its regulatory standard: CTRs cover cash above 10,000within15days,SARscoversuspiciousactivityof10,000 within 15 days, SARs cover suspicious activity of 5,000 or more within 30 days, CIP requires collecting and verifying four essential identification items, and OFAC rules mandate blocking assets on the SDN list.

Step-by-Step Solution

1
Identify the threshold and timeline for Currency Transaction Reports.
CTRs apply to cash transactions over $10,000 in a single business day and must be filed within 15 calendar days.
FinCEN regulations mandate currency tracking for large cash movements to combat money laundering.
2
Identify the threshold and confidentiality rules for Suspicious Activity Reports.
SARs apply to suspicious transactions of $5,000 or more and must be filed within 30 calendar days without informing the customer.
SAR filings help law enforcement detect illegal activities while preventing tipping off targets.
3
Identify the baseline requirements of the Customer Identification Program (CIP).
CIP mandates acquiring four key identity data points (name, DOB, physical address, SSN/TIN) for identity verification.
Under the USA PATRIOT Act, verifying customer identity prevents fraudulent account creation and identity theft.
4
Identify the mandatory action under OFAC compliance.
OFAC compliance requires screening names against the SDN list and freezing assets of designated targets.
OFAC enforces economic and trade sanctions to protect national security.

Key Concept

Core Anti-Money Laundering (AML), Customer Identification Program (CIP), and OFAC Sanctions Obligations
Estimated Time:1m 0s
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Topics

Anti-Money Laundering (AML), KYC, and Sanctions Compliance