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Question 1 of 30
1. Question
What does the term ‘business relations’ mean?
I. The natural person who ultimately owns or controls the customer or the natural person on whose behalf a transaction is conducted or business relations are established and include any person who exercises ultimate effective control over a legal person or legal arrangement.
II. The financial institution that receives the wire transfer from the ordering institution, directly or through an intermediary institution, and makes the funds available to the wire transfer beneficiary.
III. The opening or maintenance of an account by the bank in the name of a person.
IV. The provision of financial advice by the bank to a person.Correct
‘Business relations’ means:
i) The opening or maintenance of an account by the bank in the name of; or
ii) The provision of financial advice by the bank to a person (whether a natural person, legal person or legal arrangement).Incorrect
‘Business relations’ means:
i) The opening or maintenance of an account by the bank in the name of; or
ii) The provision of financial advice by the bank to a person (whether a natural person, legal person or legal arrangement). -
Question 2 of 30
2. Question
The bank shall perform the required measures under Customer Due Diligence (CDD) when the bank undertakes any transaction of a value exceeding a certain amount. How much is the value of the transaction required?
Correct
A bank shall perform the measures as required in paragraphs under Customer Due Diligence (CDD) when:
i) The bank establishes business relations with any customer.
ii) The bank undertakes any transaction of a value exceeding S$20,000 for any customer who has not otherwise established business relations with the bank.Incorrect
A bank shall perform the measures as required in paragraphs under Customer Due Diligence (CDD) when:
i) The bank establishes business relations with any customer.
ii) The bank undertakes any transaction of a value exceeding S$20,000 for any customer who has not otherwise established business relations with the bank. -
Question 3 of 30
3. Question
The third stage in money laundering (‘ML’) is integration. What is the definition of the integration stage?
Correct
Integration is defined as the provision of apparent legitimacy to the benefits derived from criminal conduct. If the layering process succeeds, the integration schemes place the laundered funds back into the economy so that they reenter the financial system appearing to be legitimate funds.
Incorrect
Integration is defined as the provision of apparent legitimacy to the benefits derived from criminal conduct. If the layering process succeeds, the integration schemes place the laundered funds back into the economy so that they reenter the financial system appearing to be legitimate funds.
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Question 4 of 30
4. Question
If the customer is a legal person or legal arrangement, what type of information shall be identified and obtained by the bank for the connected parties of the customer?
I. Residential address.
II. Unique identification number such as an identity card number.
III. Full name, including any aliases.
IV. Nationality, place of incorporation or place of registration.Correct
If the customer is a legal person or legal arrangement, the bank shall identify the connected parties of the customer, by obtaining at least the following information of each connected party:
i) Full name, including any aliases; and
ii) Unique identification number (such as an identity card number, birth certificate number or passport number of the connected party).Incorrect
If the customer is a legal person or legal arrangement, the bank shall identify the connected parties of the customer, by obtaining at least the following information of each connected party:
i) Full name, including any aliases; and
ii) Unique identification number (such as an identity card number, birth certificate number or passport number of the connected party). -
Question 5 of 30
5. Question
What type of document(s) will be obtained by the bank to verify the due authority of each natural person appointed to act on behalf of the customer?
I. The appropriate documentary evidence authorising the appointment of such natural person by the customer to act on his or its behalf.
II. The specimen signature of such natural person appointed.
III. Full name, including any aliases.
IV. Date of birth.Correct
A bank shall verify the due authority of each natural person appointed to act on behalf of the customer by obtaining at least the following:
i) The appropriate documentary evidence authorising the appointment of such natural person by the customer to act on his or its behalf.
ii) The specimen signature of such natural person appointed.Incorrect
A bank shall verify the due authority of each natural person appointed to act on behalf of the customer by obtaining at least the following:
i) The appropriate documentary evidence authorising the appointment of such natural person by the customer to act on his or its behalf.
ii) The specimen signature of such natural person appointed. -
Question 6 of 30
6. Question
What circumstances does not require a bank to perform CDD measures?
I. Where a customer or any beneficial owner of the customer is not from or in a country or jurisdiction in relation to which the FATF has called for countermeasures
II. Where a customer or any beneficial owner of the customer is from or in a country or jurisdiction in relation to which the FATF has called for countermeasures.
III. Where a customer or any beneficial owner of the customer is from or in a country or jurisdiction known to have inadequate AML/CFT measures, as determined by the bank for itself or notified to banks generally by the Authority, or other foreign regulatory authorities.
IV. Where a customer or any beneficial owner of the customer is from or in a country or jurisdiction known to have adequate AML/CFT measures, as determined by the bank for itself or notified to banks generally by the Authority, or other foreign regulatory authorities.Correct
A bank shall not perform simplified CDD measures:
i) Where a customer or any beneficial owner of the customer is from or in a country or jurisdiction in relation to which the FATF has called for countermeasures.
ii) Where a customer or any beneficial owner of the customer is from or in a country or jurisdiction known to have inadequate AML/CFT measures, as determined by the bank for itself or notified to banks generally by the Authority, or other foreign regulatory authorities.
iii) Where the bank suspects that money laundering or terrorism financing is involved.Incorrect
A bank shall not perform simplified CDD measures:
i) Where a customer or any beneficial owner of the customer is from or in a country or jurisdiction in relation to which the FATF has called for countermeasures.
ii) Where a customer or any beneficial owner of the customer is from or in a country or jurisdiction known to have inadequate AML/CFT measures, as determined by the bank for itself or notified to banks generally by the Authority, or other foreign regulatory authorities.
iii) Where the bank suspects that money laundering or terrorism financing is involved. -
Question 7 of 30
7. Question
There are three lines of defence involved in the identification of ML/TF risks faced by an insurer. Who would be involved in the third line of defence?
Correct
The third line of defence is an insurer’s internal audit function, which plays a key role in independently evaluating the insurer’s AML/CFT risk management framework and controls. This independent assessment is achieved through internal audits (or an equivalent function’s periodic evaluations) of the insurer’s compliance with AML/CFT laws and regulations, as well as policies, procedures and controls.
Incorrect
The third line of defence is an insurer’s internal audit function, which plays a key role in independently evaluating the insurer’s AML/CFT risk management framework and controls. This independent assessment is achieved through internal audits (or an equivalent function’s periodic evaluations) of the insurer’s compliance with AML/CFT laws and regulations, as well as policies, procedures and controls.
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Question 8 of 30
8. Question
What does the term ‘foreign politically exposed person’ means?
Correct
‘Foreign politically exposed person’ means a natural person who is or has been entrusted with prominent public functions in a foreign country and ‘international organisation politically exposed person’ means a natural person who is or has been entrusted with prominent public functions in an international organization.
Incorrect
‘Foreign politically exposed person’ means a natural person who is or has been entrusted with prominent public functions in a foreign country and ‘international organisation politically exposed person’ means a natural person who is or has been entrusted with prominent public functions in an international organization.
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Question 9 of 30
9. Question
In a cross-border wire transfer where the amount to be transferred is below or equal to S$1,500, what information shall be included by every bank which is an ordering institution in the message or payment instruction that accompanies or relates to the wire transfer?
I. The name of the wire transfer originator.
II. The wire transfer originator’s account number or unique transaction reference number where no account number exists.
III. The name of the wire transfer beneficiary.
IV. The wire transfer beneficiary’s account number or unique transaction reference number where no account number exists.Correct
In a cross-border wire transfer where the amount to be transferred is below or equal to S$1,500, every bank which is an ordering institution shall include in the message or payment instruction that accompanies or relates to the wire transfer the following:
i) The name of the wire transfer originator.
ii) The wire transfer originator’s account number (or unique transaction reference number where no account number exists).
iii) The name of the wire transfer beneficiary.
iv) The wire transfer beneficiary’s account number (or unique transaction reference number where no account number exists).Incorrect
In a cross-border wire transfer where the amount to be transferred is below or equal to S$1,500, every bank which is an ordering institution shall include in the message or payment instruction that accompanies or relates to the wire transfer the following:
i) The name of the wire transfer originator.
ii) The wire transfer originator’s account number (or unique transaction reference number where no account number exists).
iii) The name of the wire transfer beneficiary.
iv) The wire transfer beneficiary’s account number (or unique transaction reference number where no account number exists). -
Question 10 of 30
10. Question
What does the term ‘connected party’ mean?
I. In relation to a legal person (other than a partnership), means any director or any natural person having executive authority in the legal person.
II. In relation to a legal person that is a partnership, means any partner or manager.
III. In relation to a legal arrangement, means any natural person having executive authority in the legal arrangement.
IV. In relation to a customer of a bank, means the natural person who ultimately owns or controls the customer.Correct
‘Connected party’ means:
i) In relation to a legal person (other than a partnership), means any director or any natural person having executive authority in the legal person.
ii) In relation to a legal person that is a partnership, means any partner or manager.
iii) In relation to a legal arrangement, means any natural person having executive authority in the legal arrangement.Incorrect
‘Connected party’ means:
i) In relation to a legal person (other than a partnership), means any director or any natural person having executive authority in the legal person.
ii) In relation to a legal person that is a partnership, means any partner or manager.
iii) In relation to a legal arrangement, means any natural person having executive authority in the legal arrangement. -
Question 11 of 30
11. Question
Which department is involved in the second line of defence in the identification of ML/TF risks faced by an insurer?
I. Operations.
II. Human resources.
III. Technology.
IV. Front office.Correct
The second line of defence includes support functions such as operations, human resource or technology that work together with the compliance function to identify ML/TF risks.
Incorrect
The second line of defence includes support functions such as operations, human resource or technology that work together with the compliance function to identify ML/TF risks.
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Question 12 of 30
12. Question
What components are included in the targeted financial sanctions (TFS)?
I. Sanctions relating to TF (i.e. the lists indicated under the First Schedule of the TSOFA and any other lists or information provided by the Monetary Authority of Singapore (“the Authority”) or other relevant authorities in Singapore regarding sanctions relating to TF).
II. Sanctions relating to ML(Money Laundering).
III. Sanctions relating to PF that make reference to resolutions effected by the United Nations Security Council (‘UNSC’).
IV. Sanctions relating to resolutions effected by the UNSC on undesirable persons.Correct
In addition, targeted financial sanctions (“TFS”) relate to specific sanctions imposed in relation to both asset freezing and prohibitions to prevent funds or other assets from being made available, directly or indirectly, for the benefit of designated persons and entities. TFS includes the following components:
i) Sanctions relating to TF (i.e. the lists indicated under the First Schedule of the TSOFA and any other lists or information provided by the Monetary Authority of Singapore (“the Authority”) or other relevant authorities in Singapore regarding sanctions relating to TF).
ii) Sanctions relating to PF that make reference to resolutions effected by the United Nations Security Council (‘UNSC’).
iii) Sanctions relating to resolutions effected by the UNSC on undesirable persons.Incorrect
In addition, targeted financial sanctions (“TFS”) relate to specific sanctions imposed in relation to both asset freezing and prohibitions to prevent funds or other assets from being made available, directly or indirectly, for the benefit of designated persons and entities. TFS includes the following components:
i) Sanctions relating to TF (i.e. the lists indicated under the First Schedule of the TSOFA and any other lists or information provided by the Monetary Authority of Singapore (“the Authority”) or other relevant authorities in Singapore regarding sanctions relating to TF).
ii) Sanctions relating to PF that make reference to resolutions effected by the United Nations Security Council (‘UNSC’).
iii) Sanctions relating to resolutions effected by the UNSC on undesirable persons. -
Question 13 of 30
13. Question
What is the definition of ‘legal person’ according to the notice?
Correct
‘Legal person’ means an entity other than a natural person that can establish a permanent customer relationship with a financial institution or otherwise own property. ‘Financial group’ means a group that consists of a legal person or legal arrangement exercising control and coordinating functions over the rest of the group for the application of group supervision under the Core Principles, and its branches and subsidiaries that are financial institutions as defined in section 27A(6) of the MAS Act or the equivalent financial institutions outside Singapore.
Incorrect
‘Legal person’ means an entity other than a natural person that can establish a permanent customer relationship with a financial institution or otherwise own property. ‘Financial group’ means a group that consists of a legal person or legal arrangement exercising control and coordinating functions over the rest of the group for the application of group supervision under the Core Principles, and its branches and subsidiaries that are financial institutions as defined in section 27A(6) of the MAS Act or the equivalent financial institutions outside Singapore.
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Question 14 of 30
14. Question
Which areas should be covered by an insurer when he/she is establishing policies for periodic AML/CFT internal audits?
I. Adequacy of the insurer’s AML/CFT policies, procedures and controls in identifying ML/TF risks, addressing the identified risks and complying with laws, regulations and notices.
II. Effectiveness of the insurer’s officers, employees and agents in implementing the insurer’s policies, procedures and controls.
III. Effectiveness of the compliance oversight and quality control including parameters and criteria for transaction alerts
IV. Adequacy and effectiveness of the insurer’s AML/CFT training of relevant officers, employees and agents.Correct
An insurer should establish policies for periodic AML/CFT internal audits, covering areas such as –
i) Adequacy of the insurer’s AML/CFT policies, procedures and controls in identifying ML/TF risks, addressing the identified risks and complying with laws, regulations and notices.
ii) Effectiveness of the insurer’s officers, employees and agents in implementing the insurer’s policies, procedures and controls.
iii) Effectiveness of the compliance oversight and quality control including parameters and criteria for transaction alerts.
iv) Adequacy and effectiveness of the insurer’s AML/CFT training of relevant officers, employees and agents.The results of these assessments should be reported to either the Audit or Risk Committee of the insurer or a similar body of oversight, on a regular basis. Significant AML/CFT issues should be escalated to the Board. Any deficiencies identified should be promptly addressed to mitigate risks, including legal and reputational risks, to the insurer.
Incorrect
An insurer should establish policies for periodic AML/CFT internal audits, covering areas such as –
i) Adequacy of the insurer’s AML/CFT policies, procedures and controls in identifying ML/TF risks, addressing the identified risks and complying with laws, regulations and notices.
ii) Effectiveness of the insurer’s officers, employees and agents in implementing the insurer’s policies, procedures and controls.
iii) Effectiveness of the compliance oversight and quality control including parameters and criteria for transaction alerts.
iv) Adequacy and effectiveness of the insurer’s AML/CFT training of relevant officers, employees and agents.The results of these assessments should be reported to either the Audit or Risk Committee of the insurer or a similar body of oversight, on a regular basis. Significant AML/CFT issues should be escalated to the Board. Any deficiencies identified should be promptly addressed to mitigate risks, including legal and reputational risks, to the insurer.
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Question 15 of 30
15. Question
The bank shall identify the beneficial owners and take reasonable measures to verify the identities of the beneficial owners using the relevant information or data obtained from reliable, independent sources. For customers that are legal persons, what shall the bank do?
I. Identify the natural persons (whether acting alone or together) who ultimately own the legal person.
II. To the extent that there is doubt as to whether the natural persons who ultimately own the legal person are the beneficial owners or where no natural persons ultimately own the legal person, identify the natural persons (if any) who ultimately control the legal person or have ultimate effective control of the legal person.
III. Identify the natural persons having executive authority in the legal person, or in equivalent or similar positions.
IV. Identify the settlors, the trustees, the protector (if any), the beneficiaries and any natural person exercising ultimate ownership, ultimate control or ultimate effective control over the trust (including through a chain of control or ownership).Correct
Where there is one or more beneficial owner in relation to a customer, the bank shall identify the beneficial owners and take reasonable measures to verify the identities of the beneficial owners using the relevant information or data obtained from reliable, independent sources. The bank shall take these measures for customers that are legal persons:
(i) Identify the natural persons (whether acting alone or together) who ultimately own the legal person.
(ii) To the extent that there is doubt under subparagraph (i) as to whether the natural persons who ultimately own the legal person are the beneficial owners or where no natural persons ultimately own the legal person, identify the natural persons (if any) who ultimately control the legal person or have ultimate effective control of the legal person.
(iii) Where no natural persons are identified under subparagraph (i) or (ii), identify the natural persons having executive authority in the legal person, or in equivalent or similar positions.Incorrect
Where there is one or more beneficial owner in relation to a customer, the bank shall identify the beneficial owners and take reasonable measures to verify the identities of the beneficial owners using the relevant information or data obtained from reliable, independent sources. The bank shall take these measures for customers that are legal persons:
(i) Identify the natural persons (whether acting alone or together) who ultimately own the legal person.
(ii) To the extent that there is doubt under subparagraph (i) as to whether the natural persons who ultimately own the legal person are the beneficial owners or where no natural persons ultimately own the legal person, identify the natural persons (if any) who ultimately control the legal person or have ultimate effective control of the legal person.
(iii) Where no natural persons are identified under subparagraph (i) or (ii), identify the natural persons having executive authority in the legal person, or in equivalent or similar positions. -
Question 16 of 30
16. Question
What does the term ‘cover payment’ means?
Correct
‘Cover payment’ means a wire transfer that combines a payment message sent directly by the ordering institution to the beneficiary institution with the routing of the funding instruction from the ordering institution to the beneficiary institution through one or more intermediary institutions.
Incorrect
‘Cover payment’ means a wire transfer that combines a payment message sent directly by the ordering institution to the beneficiary institution with the routing of the funding instruction from the ordering institution to the beneficiary institution through one or more intermediary institutions.
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Question 17 of 30
17. Question
When can a bank establish business relations with a customer before completing the verification of the identity of the customer, natural persons appointed to act on behalf of the customer and beneficial owners of the customer?
I. After the bank undertakes any transaction of a value exceeding S$20,000 for the customer.
II. After the bank effects or receives any funds by domestic wire transfer, or by cross-border wire transfer that exceeds S$1,500.
III. The risks of money laundering and terrorism financing can be effectively managed by the bank.
IV. The deferral of completion of the verification is essential in order not to interrupt the normal conduct of business operations.Correct
A bank may establish business relations with a customer before completing the verification of the identity of the customer, natural persons appointed to act on behalf of the customer and beneficial owners of the customer if:
i) The deferral of completion of the verification is essential in order not to interrupt the normal conduct of business operations.
ii) The risks of money laundering and terrorism financing can be effectively managed by the bank.Incorrect
A bank may establish business relations with a customer before completing the verification of the identity of the customer, natural persons appointed to act on behalf of the customer and beneficial owners of the customer if:
i) The deferral of completion of the verification is essential in order not to interrupt the normal conduct of business operations.
ii) The risks of money laundering and terrorism financing can be effectively managed by the bank. -
Question 18 of 30
18. Question
Screening of customers should be carried out against relevant ML/TF information sources, which include designated names of individuals and/or entities within:
I. The lists and information provided by the Authority or other relevant authorities in Singapore in relation to ML/TF risks.
II. The First Schedule of the TSOFA
III. The Second Schedule of the TSOFA
IV. The MAS TFS Regulations.Correct
Screening of customers should be carried out against relevant ML/TF information sources, which include designated names of individuals and/or entities within:
i) The lists and information provided by the Authority or other relevant authorities in Singapore in relation to ML/TF risks.
ii) The First Schedule of the TSOFA.
iii) The MAS TFS Regulations.Incorrect
Screening of customers should be carried out against relevant ML/TF information sources, which include designated names of individuals and/or entities within:
i) The lists and information provided by the Authority or other relevant authorities in Singapore in relation to ML/TF risks.
ii) The First Schedule of the TSOFA.
iii) The MAS TFS Regulations. -
Question 19 of 30
19. Question
When does a bank shall screen a customer, natural persons appointed to act on behalf of the customer, connected parties of the customer and beneficial owners of the customer against relevant money laundering and terrorism financing information sources?
I. Before the bank establishes business relations with a customer.
II. When, or as soon as reasonably practicable after, the bank establishes business relations with a customer.
III. When the bank undertakes any transaction of a value exceeding S$20,000 for any customer who has not otherwise established business relations with the bank.
IV. When the bank effects or receives any funds by domestic wire transfer, or by cross-border wire transfer that exceeds S$1,500, for a customer who has not otherwise established business relations with the bank.Correct
A bank shall screen a customer, natural persons appointed to act on behalf of the customer, connected parties of the customer and beneficial owners of the customer against relevant money laundering and terrorism financing information sources, as well as lists and information provided by the Authority or other relevant authorities in Singapore for the purposes of determining if there are any money laundering or terrorism financing risks in relation to the customer when:
i) When or as soon as reasonably practicable after, the bank establishes business relations with a customer.
ii) The bank undertakes any transaction of a value exceeding S$20,000 for any customer who has not otherwise established business relations with the bank.
iii) The bank effects or receives any funds by domestic wire transfer, or by cross-border wire transfer that exceeds S$1,500, for a customer who has not otherwise established business relations with the bank.
iv) On a periodic basis after the bank establishes business relations with the customer.
v) When there are any changes or updates to the lists and information provided by the Authority or other relevant authorities in Singapore to the bank or the natural persons appointed to act on behalf of a customer, connected parties of a customer or beneficial owners of a customer.Incorrect
A bank shall screen a customer, natural persons appointed to act on behalf of the customer, connected parties of the customer and beneficial owners of the customer against relevant money laundering and terrorism financing information sources, as well as lists and information provided by the Authority or other relevant authorities in Singapore for the purposes of determining if there are any money laundering or terrorism financing risks in relation to the customer when:
i) When or as soon as reasonably practicable after, the bank establishes business relations with a customer.
ii) The bank undertakes any transaction of a value exceeding S$20,000 for any customer who has not otherwise established business relations with the bank.
iii) The bank effects or receives any funds by domestic wire transfer, or by cross-border wire transfer that exceeds S$1,500, for a customer who has not otherwise established business relations with the bank.
iv) On a periodic basis after the bank establishes business relations with the customer.
v) When there are any changes or updates to the lists and information provided by the Authority or other relevant authorities in Singapore to the bank or the natural persons appointed to act on behalf of a customer, connected parties of a customer or beneficial owners of a customer. -
Question 20 of 30
20. Question
What topics do the employees and officers (whether in Singapore or elsewhere) in banks are regularly and appropriately trained on?
I. AML/CFT laws and regulations, and in particular, CDD measures.
II. The bank’s internal policies, procedures and controls on AML/CFT.
III. Prevailing techniques in money laundering and terrorism financing.
IV. AML/ CFT laws and regulations but the CDD measures will be excluded.Correct
A bank shall take all appropriate steps to ensure that its employees and officers (whether in Singapore or elsewhere) are regularly and appropriately trained on:
i) AML/CFT laws and regulations, and in particular, CDD measures, detecting and reporting of suspicious transactions.
ii) Prevailing techniques, methods and trends in money laundering and terrorism financing.
iii) The bank’s internal policies, procedures and controls on AML/CFT and the roles and responsibilities of employees and officers in combating money laundering and terrorism financing.Incorrect
A bank shall take all appropriate steps to ensure that its employees and officers (whether in Singapore or elsewhere) are regularly and appropriately trained on:
i) AML/CFT laws and regulations, and in particular, CDD measures, detecting and reporting of suspicious transactions.
ii) Prevailing techniques, methods and trends in money laundering and terrorism financing.
iii) The bank’s internal policies, procedures and controls on AML/CFT and the roles and responsibilities of employees and officers in combating money laundering and terrorism financing. -
Question 21 of 30
21. Question
What would make a bank to ensure that its group policy on AML/CFT is strictly observed by the management of that branch or subsidiary when a bank has a branch or subsidiary in a host country or jurisdiction?
I. In relation to which the FATF has not called for countermeasures.
II. In relation to which the FATF has called for countermeasures.
III. Known to have inadequate AML/CFT measures, as determined by the bank for itself, notified to banks generally by the Authority or other foreign regulatory authorities.
IV. Known to have adequate AML/CFT measures, as determined by the bank for itself, notified to banks generally by the Authority or other foreign regulatory authorities.Correct
The bank shall ensure that its group policy on AML/CFT is strictly observed by the management of that branch or subsidiary when a bank has a branch or subsidiary in a host country or jurisdiction:
i) In relation to which the FATF has called for countermeasures.
ii) Known to have inadequate AML/CFT measures, as determined by the bank for itself, notified to banks generally by the Authority or other foreign regulatory authorities.Incorrect
The bank shall ensure that its group policy on AML/CFT is strictly observed by the management of that branch or subsidiary when a bank has a branch or subsidiary in a host country or jurisdiction:
i) In relation to which the FATF has called for countermeasures.
ii) Known to have inadequate AML/CFT measures, as determined by the bank for itself, notified to banks generally by the Authority or other foreign regulatory authorities. -
Question 22 of 30
22. Question
Screening of customers should be conducted on a regular basis after the establishment of business relations. How many months once the insurer should conduct such ongoing screening minimally?
Correct
Given that most direct general insurance and reinsurance policies are relatively short-term in nature (e.g. 1 year), the insurer should conduct such ongoing screening minimally at a frequency of once every 6 months, or upon the occurrence of a trigger event as deemed necessary by the insurer, whichever is earlier. Higher risk customers should be subject to screening at a higher frequency.
Incorrect
Given that most direct general insurance and reinsurance policies are relatively short-term in nature (e.g. 1 year), the insurer should conduct such ongoing screening minimally at a frequency of once every 6 months, or upon the occurrence of a trigger event as deemed necessary by the insurer, whichever is earlier. Higher risk customers should be subject to screening at a higher frequency.
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Question 23 of 30
23. Question
How long does a bank shall keep the record retention?
I. For CDD information relating to the business relations, wire transfers and transactions undertaken without an account being opened, as well as account files, business correspondence and results of any analysis undertaken, a period of at least 10 years following the termination of such business relations or completion of such wire transfers or transactions.
II. For data, documents and information relating to a transaction, including any information needed to explain and reconstruct the transaction, a period of at least 10 years following the completion of the transaction.
III. For CDD information relating to the business relations, wire transfers and transactions undertaken without an account being opened, as well as account files, business correspondence and results of any analysis undertaken, a period of at least 5 years following the termination of such business relations or completion of such wire transfers or transactions.
IV. For data, documents and information relating to a transaction, including any information needed to explain and reconstruct the transaction, a period of at least 5 years following the completion of the transaction.Correct
A bank shall, for the purposes of record retention and when setting its record retention policies, comply with the following record retention periods:
i) For CDD information relating to the business relations, wire transfers and transactions undertaken without an account being opened, as well as account files, business correspondence and results of any analysis undertaken, a period of at least 5 years following the termination of such business relations or completion of such wire transfers or transactions.
ii) For data, documents and information relating to a transaction, including any information needed to explain and reconstruct the transaction, a period of at least 5 years following the completion of the transaction.Incorrect
A bank shall, for the purposes of record retention and when setting its record retention policies, comply with the following record retention periods:
i) For CDD information relating to the business relations, wire transfers and transactions undertaken without an account being opened, as well as account files, business correspondence and results of any analysis undertaken, a period of at least 5 years following the termination of such business relations or completion of such wire transfers or transactions.
ii) For data, documents and information relating to a transaction, including any information needed to explain and reconstruct the transaction, a period of at least 5 years following the completion of the transaction. -
Question 24 of 30
24. Question
What is the circumstance required by a bank to perform the measures as required by the Customer Due Diligence (CDD)?
Correct
A bank shall perform the measures as required by the paragraphs stated under Customer Due Diligence (CDD) when:
i) The bank establishes business relations with any customer.
ii) The bank effects or receives any funds by domestic wire transfer, or by cross border wire transfer that exceeds S$1,500, for any customer who has not otherwise established business relations with the bank.
iii) There is a suspicion of money laundering or terrorism financing, notwithstanding that the bank would not otherwise be required by this Notice to perform the measures as required.
iv) The bank has doubts about the veracity or adequacy of any information previously obtained.Incorrect
A bank shall perform the measures as required by the paragraphs stated under Customer Due Diligence (CDD) when:
i) The bank establishes business relations with any customer.
ii) The bank effects or receives any funds by domestic wire transfer, or by cross border wire transfer that exceeds S$1,500, for any customer who has not otherwise established business relations with the bank.
iii) There is a suspicion of money laundering or terrorism financing, notwithstanding that the bank would not otherwise be required by this Notice to perform the measures as required.
iv) The bank has doubts about the veracity or adequacy of any information previously obtained. -
Question 25 of 30
25. Question
Which of the following examples of suspicious circumstances warrant the filing of an STR in terms of determining and assessing suspicious activity exhibited by customers?
I. Where the customer is reluctant, unable or unwilling to provide any information requested by the insurer.
II. Where the customer, with reasonable grounds, decides to withdraw a pending application to establish business relations with the insurer.
III. Where the customer, with reasonable grounds, decides to suddenly terminate existing business relations with the insurer.
IV. Abnormal settlement instructions, including payment to apparently unconnected parties.Correct
In terms of determining and assessing suspicious activity exhibited by customers, examples of suspicious circumstances that may warrant the filing of an STR may include the following:
i) Where the customer is reluctant, unable or unwilling to provide any information requested by the insurer.
ii) Where the customer, without reasonable grounds, decides to withdraw a pending application to establish business relations with the insurer.
iii) Where the customer, without reasonable grounds, decides to suddenly terminate existing business relations with the insurer.
iv) Abnormal settlement instructions, including payment to apparently unconnected parties.
v)Frequent changes to the customer’s address or to authorised signatories.Incorrect
In terms of determining and assessing suspicious activity exhibited by customers, examples of suspicious circumstances that may warrant the filing of an STR may include the following:
i) Where the customer is reluctant, unable or unwilling to provide any information requested by the insurer.
ii) Where the customer, without reasonable grounds, decides to withdraw a pending application to establish business relations with the insurer.
iii) Where the customer, without reasonable grounds, decides to suddenly terminate existing business relations with the insurer.
iv) Abnormal settlement instructions, including payment to apparently unconnected parties.
v)Frequent changes to the customer’s address or to authorised signatories. -
Question 26 of 30
26. Question
A bank shall not be required to inquire if there exists any beneficial owner in relation to a customer that is an entity listed on a stock exchange outside of Singapore that is subject to some conditions. What are the conditions?
I. Incorporated or established outside Singapore but are subject to and supervised for compliance with AML/CFT requirements consistent with standards set by the FATF.
II. Regulatory disclosure requirements.
III. Requirements relating to adequate transparency in respect of its beneficial owners.
IV. Requirements relating to inadequate transparency in respect of its beneficial owners.Correct
A bank shall not be required to inquire if there exists any beneficial owner in relation to a customer that is:
i) An entity listed on the Singapore Exchange.
ii) An entity listed on a stock exchange outside of Singapore that is subject to:
– Regulatory disclosure requirements; and
– Requirements relating to adequate transparency in respect of its beneficial owners (imposed through stock exchange rules, law or other enforceable means).Incorrect
A bank shall not be required to inquire if there exists any beneficial owner in relation to a customer that is:
i) An entity listed on the Singapore Exchange.
ii) An entity listed on a stock exchange outside of Singapore that is subject to:
– Regulatory disclosure requirements; and
– Requirements relating to adequate transparency in respect of its beneficial owners (imposed through stock exchange rules, law or other enforceable means). -
Question 27 of 30
27. Question
What will a bank do when there are any reasonable grounds for suspicion that existing business relations with a customer are connected with money laundering or terrorism financing and when the bank considers it appropriate to retain the customer?
I. Monitor its business relations with customers only.
II. Detect and report suspicious, complex, unusually large or unusual patterns of transactions.
III. The bank shall substantiate and document the reasons for retaining the customer.
IV. The customer’s business relations with the bank shall be subject to commensurate risk mitigation measures, including enhanced ongoing monitoring.Correct
When there are any reasonable grounds for suspicion that existing business relations with a customer are connected with money laundering or terrorism financing, and when the bank considers it appropriate to retain the customer:
i) The bank shall substantiate and document the reasons for retaining the customer.
ii) The customer’s business relations with the bank shall be subject to commensurate risk mitigation measures, including enhanced ongoing monitoring.Incorrect
When there are any reasonable grounds for suspicion that existing business relations with a customer are connected with money laundering or terrorism financing, and when the bank considers it appropriate to retain the customer:
i) The bank shall substantiate and document the reasons for retaining the customer.
ii) The customer’s business relations with the bank shall be subject to commensurate risk mitigation measures, including enhanced ongoing monitoring. -
Question 28 of 30
28. Question
How many business days should the STR be filed within?
Correct
An STR should be filed within 15 business days of the case being referred by the relevant officer, employee or agent, if the insurer has assessed that the matter should be referred to the STRO unless the circumstances are exceptional or extraordinary. The decision as to whether to refer the matter to the STRO should be regardless of the amount of the transaction, if any.
Incorrect
An STR should be filed within 15 business days of the case being referred by the relevant officer, employee or agent, if the insurer has assessed that the matter should be referred to the STRO unless the circumstances are exceptional or extraordinary. The decision as to whether to refer the matter to the STRO should be regardless of the amount of the transaction, if any.
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Question 29 of 30
29. Question
What does the term ‘shell financial institution’ means?
Correct
‘Shell financial institution’ means a bank or financial institution incorporated, formed or established in a country or jurisdiction where the bank or financial institution has no physical presence and which is unaffiliated with a financial group that is subject to effective consolidated supervision.
Incorrect
‘Shell financial institution’ means a bank or financial institution incorporated, formed or established in a country or jurisdiction where the bank or financial institution has no physical presence and which is unaffiliated with a financial group that is subject to effective consolidated supervision.
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Question 30 of 30
30. Question
What are the screening procedures that should be put in place by insurers when hiring employees, officers and agents and when establishing business relationships with offshore intermediaries?
I. Background checks with past employers.
II. Credit history checks.
III. Screening against ML/TF information sources.
IV. Bankruptcy searches.Correct
Insurers should also have in place screening procedures when hiring employees, officers and agents, and when establishing business relationships with offshore intermediaries. This should include, where applicable:
i) Background checks with past employers.
ii) Credit history checks.
iii) Screening against ML/TF information sources.
iv) Bankruptcy searches.Incorrect
Insurers should also have in place screening procedures when hiring employees, officers and agents, and when establishing business relationships with offshore intermediaries. This should include, where applicable:
i) Background checks with past employers.
ii) Credit history checks.
iii) Screening against ML/TF information sources.
iv) Bankruptcy searches.