Question 1

You are the chief compliance officer for a non-U S Bank that maintains some accounts in the name of U S residents Your country has signed a FATCA Model 1 inter-governmental agreement. In developing your FATCA compliance program which should be incorporated into your program?

Options :

A : Customer due diligence for FATCA should be based on existing IRS requirements (or Qualified Intermediaries

B : Customer due diligence for FATCA should leverage your existing AML program

C : IRS reporting must include all account balances and securities held in the name of a US resident

D : Once evidence indicates a relationship with a U S resident, an exemption to file form must be obtained

Answer: C

Question 2

A new banking customer is flagged as a politically exposed person (PEP) from a developing country. This country is known for graft corruption, political oppression and very recently kleptocracy. You are an officer at a bank responsible lor determining if the bank will do business with this PEP. Given your responsibilities as an officer which course of action is MOST ethical?

Options :

A : Contact the country's government regulator notifying them that the PEP is attempting to open an account and inquire as to the PEP's perceived status

B : Contact your personal network of compliance peers to see if they have filed any reports against the PEP in the past

C : Download a law enforcement report about the PEP from WikiLeaks

D : While your employer does not forbid accounts from this country, recommend that enhanced due diligence be performed andthe customer be put on high-risk review

Answer: B

Question 3

A bank holds accounts for several different gatekeeper clients such as attorneys accountants and company formation agents II is conducting a periodic review of these accounts and updating their risk ratings. Which two accounts should the bank consider to be at highest risk? Choose 2 answers

Options :

A : A company formation agent that establishes private investment companies primarily for clients in Africa and Asia

B : An attorney whose practice specializes in cases involving maritime law in the international shipping industry

C : An accountant at a private accounting firm whose clients are large multinational agricultural corporations

D : A notary in Latin America who specializes in assisting clients from other countries with high-end real estate transactions

Answer: A,D

Question 4

You are an auditor reviewing the financial statements of a firm that manufactures construction equipment The firm's sales have slowed in recent months. Within the last quarter it has closed one of its lactones, however the firm's management are still reporting a positive outlook. Concerned shareholders have asked you to investigate (or possible signs of improper accounting or fraud. You are reviewing two balance sheets from the start and end of the quarter below Given this information and your knowledge of the company s status which issue is MOST likely to be a red flag?

Options :

A : Receivables and inventory levels have increased over three months despite a reduction in sales

B : Wages payable has reduced by nearly $100,000 in the last three months

C : The firm's property plant and equipment have dropped substantially in the past three months

D : Other liabilities have remained roughly the same over the three-monlh period despite a decline in total liabilities

Answer: A

Question 5

Your client is the family of a man who is deceased. The family remembers stones that their father (the deceased) had a Cayman Islands company where he held his investments. They have located a file containing an old Cayman Islands bank statement in the name of Company A Limited and in care of a post office address. They want to know what information they can find out about the company and the account. How can they determine if the company still exists?

Options :

A : Conduct an internet search for the company's name as company information is public

B : Visit the post office and ask for access to the PO Box

C : Check with the Corporate Registry as this information is public

D : Contact the bank and ask the status of the company

Answer: C