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Question

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

Match each anti-money laundering (AML) or compliance framework component on the left with its corresponding regulatory mandate or filing threshold on the right.

  • Currency Transaction Report (CTR)Mandatory filing for cash deposits or withdrawals exceeding $10,000 in a single business day, submitted within 15 calendar days.
  • Suspicious Activity Report (SAR)Confidential report required for suspicious transactions of $5,000 or more, submitted within 30 calendar days.
  • Customer Identification Program (CIP)Obligation to collect and verify customer identity details (name, DOB, address, TIN) prior to or shortly after account opening.
  • Office of Foreign Assets Control (OFAC) SDN ListRequirement to screen customers and immediately block assets or reject transactions involving listed entities and embargoed countries.

Answer

Currency Transaction Report matches cash filings over 10,000within15days;SuspiciousActivityReportmatchessuspiciousfilingsof10,000 within 15 days; Suspicious Activity Report matches suspicious filings of 5,000 or more within 30 days; Customer Identification Program matches account-opening identity verification; OFAC SDN List matches sanctions screening and asset blocking mandates.
Each anti-money laundering and sanctions mechanism aligns directly with its governing regulatory definition: CTRs govern 10,000+cashevents(15days);SARsgovern10,000+ cash events (15 days); SARs govern 5,000+ suspicious events (30 days); CIP mandates account opening identity checks; and OFAC screening requires asset freezing for designated nationals.

Step-by-Step Solution

1
Identify the scope, threshold, and deadline for cash currency reporting under Bank Secrecy Act rules.
CTRs govern physical currency transactions exceeding $10,000 in a single day and must be submitted within 15 calendar days.
Federal law strictly differentiates physical cash reporting from broader suspicious activity reporting.
2
Determine the legal trigger, monetary threshold, and filing period for suspicious activity reports.
SARs are confidential filings triggered by suspicious activity involving $5,000 or more and must be filed within 30 calendar days.
Broker-dealers are prohibited from notifying clients that a SAR has been filed.
3
Differentiate Customer Identification Program (CIP) and OFAC compliance obligations.
CIP focuses on verifying identity elements at account onboarding, whereas OFAC enforces trade sanctions by requiring asset blocking for SDN matches.
CIP is a KYC identity rule, while OFAC is a federal sanctions enforcement program.

Key Concept

Anti-Money Laundering (AML) Reporting Thresholds, CIP Verification, and OFAC Sanctions Compliance
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Topics

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