AML KYC Practice Exam

About AML KYC
Money laundering is the process of concealing the source of money obtained by illicit means such as gambling, corruption, extortion, drug trafficking, human trafficking, etc., Money is moved around the financial system again and again in such manner that its origin gets hidden. It is the process of making dirty money clean.

AML laws aim to reduce money laundering and terrorism funding.

AML compliance programs comprise interior and outer frameworks. These apply KYC during on-boarding, identification of suspicious movements (eg. flagged transactions), oversee risk controls, offer staff training, and submission  of independent audits regularly. Consolidating these frameworks gives FIs a far higher possibility of quick identification and thwarting illegal activity.

Know Your Customer (KYC) implies the process of validating a customer’s identification. It’s a subset of the larger term AML.

It is used by businesses to gather information about their clients and verify their credentials. Clients wanting to use a company’s service must present their identification documents. Likewise, it helps the organisation to adequately evaluate the risk involved with every client.

Why is AM- KYC important?

AML KYC is important to a bank or financial business.

Worldwide, KYC and AML regulations are in place. Financing for terrorism and economic crimes unfortunately, does not always end at the country’s borders. They need to be dealt with, and for which, regulators are enforcing significantly stricter KYC and AML norms.

If you let users move money, you or your business can be a money laundering target.

Compliance with KYC and AML is not only important for the safety and satisfaction of customers, but it is also required by law. Regulations require all banks and FIs to adhere to the specified set of AML standards. A comprehensive anti-money laundering strategy begins with KYC initiatives.

Without it, a business will struggle to make sales and expand. A business must have a good AML-KYC strategy. As a business will struggle to generate leads as they are unsure what type of people they are looking to attract and sell to.

Many businesses today are heavily dependent on AML-KYC as it generates traffic to their websites where they can convert leads into customers. Google has made the process of connecting people to businesses easier, ensuring that businesses can let the world know how different their products and services are from their competitors. It allows you to target a customer base that is actively searching for your product or service via a search engine. And by taking the lead directly to your website it increases the chance of the lead purchasing from your business.

Benefits of AML-KYC
•    Generate Awareness.
•    Target Desired Customers.
•    Comply to laid standards.
•    Identify money laundering and terrorist financing.


Who should take the AML-KYC Exam?
•    Bank managers, bank tellers, bank executives, bank professionals
•    Professionals working in financial institutions
•    Companies dealing foreign exchange and financial services
•    AML-KYC consultants
•    Professionals working in outsourced companies responsible for AML-KYC
•    Anyone interested in AML-KYC

Knowledge and Skills required for the AML-KYC Practice Exam

Professionals who are methodical, remain calm under pressure and with analytic bent of mind, can easily scale heights in AML-KYC career.

AML-KYC Practice Exam Objective

AML-KYC exam focuses on assessing your skills and knowledge in applying  AML-KYC across the organization.

AML-KYC Practice Exam Pre-requisite

There are no prerequisites for the AML-KYC exam.

AML-KYC Certification Course Outline

1. Introduction
1.1 What is Money Laundering?
1.2 Prevention of Money Laundering Act, 2002
1.3 Global Phenomenon
1.4 Tainted Money or Dirty Money
1.5 Washing of “Dirty” Money
1.6 Money Laundering – Case Studies

2. Money Laundering - Process & Methods
2.1 Process of Money Laundering
2.2 Process of Money Laundering – Case Studies
2.3 Methods used for Money Laundering
2.4 Role of Technology
2.5 Sources of Tainted Money
2.6 Effects of Money Laundering
2.7 Economic Effects
2.8 Terrorist Financing
2.9 Informal Value Transfer Systems
2.10 Suspicious Conduct and Transactions
2.11 Unusual Transactions
2.12 Non-Face-to-Face Customers
2.13 Politically Exposed Persons

3. Legislation & International Cooperation
3.1 Legislations against Money Laundering
3.2  Financial Action Task Force (FATF)
3.3 Anti-Money Laundering Measures in India
3.4 RBI Guidelines regarding AML
3.5 Role of IBA Working Group
3.6 Technology in AML Measures
3.7 BASEL Committee
3.8 European Union Directives on Money Laundering
3.9 UK Regulatory Framework
3.10 UN RESOLUTIONS
3.11 The Wolfsberg Principles
3.12 US Regulatory Framework
3.13 Other Global Initiatives
3.14 Money Laundering Avoidance Software

4. Role of Correspondent Banking
4.1 Introduction
4.2 Policies and Measures
4.3 Wire Transfer
4.4 Role of Ordering, Intermediary and Beneficiary banks

5. KYC – Know your customer
5.1 Basic Definitions
5.2 Customer Profile
5.3 BASEL Committee on KYC Policies
5.4 KYC Policies and RBI’s Initiative
5.5 Organizational Structure in Banks

6. KYC - Operating Guidelines
6.1 Customer Profiling
6.2 Opening of Accounts
6.3 Suggested Safeguards
6.4 Closure of Accounts
6.5 Monitoring of Accounts
6.6 Credit Cards/Debit Cards/Smart Cards/Gift Cards
6.7 ‘At Par’ Cheque Facility
6.8 Combating Financing of Terrorism
6.9 Jurisdictions to not apply the FATF Recommendations

7. Internal Controls and Structure In Banks
7.1 Roles and Responsibilities of the Staff
7.2 Roles and Responsibilities of Board of Directors and Senior Management
7.3 Role and Responsibilities of the Principal Officer
7.4 Role and Responsibilities of the Internal Audit/Internal Control Teams
7.5 Role and Responsibilities of the Business Groups
7.6 Designated Director
7.7 Internal Investigations
7.8 Closing the Account
7.9 Mutual Legal Assistance Treaties
7.10 Financial Intelligence Units

8. Customer Risk Categorization (CRC)
8.1 Customer Risk
8.2 Need for Risk Categorization
8.3 Customer Acceptance Policy (CAP)
8.4 Customer Identification Procedure (CIP)
8.5 Customer Due Diligence (CDD)
8.6 Risk Scoring Model

9. Reporting Obligations
9.1 Cash Transaction Reporting (CTR)
9.2 Counterfeit Currency Reporting (CCR)
9.3 Suspicious Transaction Report (STR)
9.4 Non-Profit Organization Transaction Reports (NTRs)

10. Transaction Monitoring
10.1 Approach of Banks for Monitoring of Transactions
10.2 Essentials of Transaction Monitoring process
10.3 Methods of Monitoring
10.4 Suspicious Transaction
10.5 Name Screening

11. Staff and Customer Awareness
11.1 Training Methods
11.2 Records of training
11.3 Customer Awareness on AML
11.4 Training Program

12. KYC – Updation
12.1 Need for KYC Updation
12.2 Approach for KYC Updation
12.3 Scope of KYC Updation

Exam Format and Information
Certification name – AML-KYC Certification
Exam duration – 60 minutes
Exam type - Multiple Choice Questions
Eligibility / pre-requisite - None
Exam language - English
Exam format - Online
Passing score - 25
Exam Fees  - INR 1199