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Question

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

Match each anti-money laundering (AML) and customer due diligence component on the left with its correct regulatory threshold or operational requirement on the right.

  • Currency Transaction Report (CTR)Filed within 15 calendar days for physical cash transactions exceeding $10,000 in a single business day
  • Suspicious Activity Report (SAR)Filed within 30 calendar days for suspicious activity involving at least $5,000 in funds or assets
  • Customer Identification Program (CIP)Requires verification of customer identity details including name, date of birth, address, and taxpayer ID number
  • Office of Foreign Assets Control (OFAC)Maintains the Specially Designated Nationals (SDN) list to block or freeze transactions involving sanctioned entities

Answer

Currency Transaction Report (CTR) matches with filing within 15 calendar days for cash transactions exceeding 10,000;SuspiciousActivityReport(SAR)matcheswithfilingwithin30calendardaysforsuspiciousactivityof10,000; Suspicious Activity Report (SAR) matches with filing within 30 calendar days for suspicious activity of 5,000 or more; Customer Identification Program (CIP) matches with verifying identity details (name, DOB, address, Tax ID); and Office of Foreign Assets Control (OFAC) matches with maintaining the Specially Designated Nationals (SDN) list to block or freeze sanctioned accounts.
Each AML item is correctly matched according to federal regulatory standards: CTR applies to cash transactions exceeding 10,000within15calendardays;SARappliestosuspiciousactivitiesof10,000 within 15 calendar days; SAR applies to suspicious activities of 5,000 or more within 30 calendar days; CIP requires identity verification using official identification numbers and personal details; and OFAC enforces economic sanctions via the SDN list.

Step-by-Step Solution

1
Identify the CTR requirement.
Cash transactions exceeding $10,000 require a Currency Transaction Report filed within 15 calendar days.
The Bank Secrecy Act requires tracking large physical cash deposits and withdrawals.
2
Identify the SAR reporting trigger and timeline.
Suspicious transactions involving $5,000 or more require a Suspicious Activity Report filed within 30 calendar days.
Treasury and FINRA rules establish $5,000 as the mandatory reporting threshold for suspicious customer activity.
3
Determine the primary mandate of the CIP rules.
Firms must collect and verify basic identifying information (name, DOB, legal address, SSN/TIN).
USA PATRIOT Act provisions mandate verification to prevent illegal account access.
4
Identify the role of OFAC screening.
Firms must check accounts against the SDN list to block asset transfers connected to targeted foreign nations or criminals.
Federal sanctions regulations demand immediate freezing of assets belonging to SDN listed entities.

Key Concept

Core AML Filings, KYC Requirements, and Sanctions Screening Controls
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Topics

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