Discuss Acams CAMS Exam Topic 1 Question 92

A customer's registered business activity is a domestic carpet cleaning company. Besides domestic receipts, there are incoming weekly transactions from an international reputable

auction house starting at 15,000 USD and averaging 30,000 USD. The matching cash outgoings amount to 90% of the incoming deposits to non-related individuals. Which is most

concerning for potential money laundering?

AThe customer is paying 90% of the incoming proceeds to non-related individuals in cash.

BThe customer is a domestic carpet cleaning company.

CThe customer's international incomings are from an international reputable antique auction house.

DThe customer's initial international receipt has increased from 15,000 USD to an average of 30,000 USD per transaction per week.

Suggested Answer: A

The customer's business activity as a domestic carpet cleaning company is not inherently suspicious, as it aligns with their registered business. However, the significant weekly transactions from an international reputable antique auction house raise red flags.

The sudden increase in the customer's initial international receipt from $15,000 USD to an average of $30,000 USD per transaction per week is also noteworthy. Such a substantial change warrants further scrutiny.

The fact that 90% of the incoming deposits are matched by cash outgoings to non-related individuals could indicate layering or structuring activities associated with money laundering.

Overall, the combination of large international transactions, increased receipts, and cash outflows to unrelated parties from an antique auction house is the most concerning aspect.

Anti-Money Laundering Specialist (the 6th edition) resources.

ACAMS AML Glossary (definitions of terms related to AML).1

ACAMS AML Foundations Certificate (overview of AML concepts and responsibilities).2

ComplyAdvantage: 6th Money Laundering Directive (6AMLD) (details on AML regulations and penalties).3

Get Premium CAMS Questions as Interactive Web-Based Practice Test or PDF Real Exam Format Detailed Explanations Instant Access Get Your Practice Test

28 comments · newest first

Dona 11 months ago

Surprised by the auction house connection, seems sketchy to me!

Merissa 11 months ago

Totally agree, the cash outgoings raise a red flag for sure!

Hubert 11 months ago

Wait, why would a carpet cleaner have such high international transactions?

Claudio 12 months ago

Definitely concerning that 90% of the cash goes to non-related individuals.

Lai 1 year ago

The customer is a carpet cleaning company, but getting that much from an auction house is odd.

Ethan 1 year ago

I thought that having a reputable source like an auction house in option C would be safe, but I guess it could still be problematic with those cash outgoings.

Cammy 1 year ago

I practiced a similar question where the nature of the business was important, but I feel like the cash payments in option A are the biggest issue here.

Ben 1 year ago

I'm not entirely sure, but I think the increase in transaction amounts in option D could indicate suspicious activity too.

Luz 1 year ago

I remember discussing how large cash transactions can be a red flag for money laundering, so option A seems concerning.

Theron 1 year ago

The domestic carpet cleaning business seems like a legitimate cover, but the international auction house transactions and the high cash outgoings are definitely suspicious. I'll need to weigh all the factors carefully.

Lucina 1 year ago

I think the most concerning aspect is the high volume of cash payments to non-related individuals. That's a classic money laundering tactic, so I'd focus on that in my answer.

Latrice 1 year ago

Hmm, I'm a bit confused by the international auction house transactions. Are those legitimate business activities, or could they be a cover for something else?

Curt 1 year ago

The key thing that stands out to me is the 90% cash outgoings to non-related individuals. That seems like a potential red flag for money laundering.

Kirk 1 year ago

This question seems straightforward, but I want to make sure I understand all the details before answering.

Leslie 2 years ago

You know, if I had a carpet cleaning company that was suddenly raking in 30 grand a week from some auction house, I'd be suspicious of myself too. Just saying.

Carman 2 years ago

I bet those 'reputable' auction house payments are actually a front for some shady business. Better keep an eye on that customer!

Helaine 2 years ago

Hmm, I'm not sure the domestic carpet cleaning business itself is a concern. It's the cash payouts and international transactions that seem questionable.

Skye 2 years ago

↳ replying to Helaine

B: Yeah, that does seem suspicious. Especially with the large international transactions.

Chandra 2 years ago

↳ replying to Helaine

A: The customer is paying 90% of the incoming proceeds to non-related individuals in cash.

Julio 2 years ago

↳ replying to Helaine

C) The customer's international incomings are from an international reputable antique auction house.

Flo 2 years ago

↳ replying to Helaine

A) The customer is paying 90% of the incoming proceeds to non-related individuals in cash.

Laurel 2 years ago

But what about option D? The sudden increase in international receipts could also be a red flag for money laundering.

Laurene 2 years ago

I agree with Kristel. Paying 90% of the incoming proceeds to non-related individuals in cash seems suspicious.

Kristel 2 years ago

I think option A is most concerning for potential money laundering.

Omega 2 years ago

The 90% cash payouts to non-related individuals is definitely a red flag for potential money laundering. The increasing international deposits are also suspicious.

Desmond 2 years ago

↳ replying to Omega

A) The customer is paying 90% of the incoming proceeds to non-related individuals in cash.

Maynard 2 years ago

↳ replying to Omega

C) The customer's international incomings are from an international reputable antique auction house.

Osvaldo 2 years ago

↳ replying to Omega

A) The customer is paying 90% of the incoming proceeds to non-related individuals in cash.

Acams CAMS Exam - Topic 1 Question 92 Discussion