A compliance officer is conducting an anti-money laundering (AML) training session for newly registered representatives at a FINRA member broker-dealer. Which of the following statements accurately describe federal regulatory obligations regarding Customer Identification Program (CIP), Currency Transaction Reports (CTRs), or Suspicious Activity Reports (SARs)?
- A Currency Transaction Report (CTR) must be filed with FinCEN within 15 calendar days for aggregate physical cash deposits or withdrawals exceeding $10,000 in a single business day.Answer
- Under Customer Identification Program (CIP) requirements, a broker-dealer must verify a customer's identity using documentary or non-documentary methods within a reasonable time before or after account opening.Answer
- CA Suspicious Activity Report (SAR) must be filed within 15 calendar days whenever a customer conducts a routine securities trade using cash equivalents exceeding $10,000.
- DA registered representative may notify a long-standing client that a Suspicious Activity Report (SAR) was filed if the client formally demands an explanation for an account restriction.
Answer
The correct statements are the requirement to file a CTR for aggregate physical cash transactions exceeding $10,000 within 15 calendar days and the obligation under CIP rules to verify customer identity within a reasonable timeframe surrounding account creation.
The correct choices accurately state that CTR filings are required for aggregate cash transactions exceeding $10,000 within 15 calendar days, and that CIP rules require broker-dealers to verify customer identity within a reasonable timeframe around account opening.
Step-by-Step Solution
Key Concept
Anti-Money Laundering (AML) Compliance: CIP, CTR, and SAR Requirements