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Question

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

Match each anti-money laundering (AML), customer identification, or sanctions compliance mandate with its corresponding regulatory requirement or reporting timeline.

  • Currency Transaction Report (CTR)Must be filed with FinCEN within 15 calendar days for currency transactions exceeding $10,000 in a single business day.
  • Suspicious Activity Report (SAR)Must be filed with FinCEN within 30 calendar days for suspicious activity involving $5,000 or more.
  • Customer Identification Program (CIP) Verification RecordsMust be retained by the broker-dealer for at least 5 years after the account is closed.
  • OFAC Specially Designated Nationals (SDN) List MatchRequires immediate blocking of customer assets and reporting to Treasury within 10 business days.

Answer

The Currency Transaction Report (CTR) matches filing within 15 calendar days for cash transactions exceeding 10,000.TheSuspiciousActivityReport(SAR)matchesfilingwithin30calendardaysforsuspicioustransactionsof10,000. The Suspicious Activity Report (SAR) matches filing within 30 calendar days for suspicious transactions of 5,000 or more. CIP Verification Records match retention for 5 years post account closure. An OFAC SDN List Match matches immediate asset blocking and reporting within 10 business days.
Each anti-money laundering requirement directly matches its federal regulatory standard: CTRs require FinCEN reporting for cash over 10,000within15days;SARsrequireFinCENreportingforsuspiciousactivitiesof10,000 within 15 days; SARs require FinCEN reporting for suspicious activities of 5,000 or more within 30 days; CIP verification records must be retained for 5 years post-account closure; and OFAC SDN matches necessitate immediate asset freezing with a 10-business-day reporting requirement.

Step-by-Step Solution

1
Determine the monetary threshold and deadline for cash currency transactions.
Cash transactions exceeding $10,000 trigger a CTR filing with FinCEN within 15 calendar days.
The Bank Secrecy Act monitors large cash movements to deter illicit money flows.
2
Determine the monetary threshold and deadline for suspicious activity reporting.
Suspicious transactions totaling $5,000 or more trigger a SAR filing with FinCEN within 30 calendar days.
FinCEN rules mandate reporting when a transaction lacks a clear economic or legal purpose.
3
Determine the required record retention period for Customer Identification Program data.
CIP verification information must be kept for 5 years after the account is closed.
Federal regulation specifies a post-closure retention window for customer identity records.
4
Determine the compliance action required for an OFAC SDN target.
Assets must be blocked immediately and reported to OFAC within 10 business days.
U.S. sanctions law requires financial intermediaries to prevent sanctioned parties from transferring or accessing funds.

Key Concept

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

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