Certified Anti-Money Laundering Specialist (CAMS) Study Guide

Introduction

• Mission of ACAMS: Advance professional knowledge in AML detection/prevention, promote sound policies, and provide networking opportunities.
• CAMS Designation: Internationally recognized credential indicating AML expertise.

Risks and Methods of Money Laundering and Terrorist Financing

What Is Money Laundering?

• Disguises illegal funds' origins to make them appear legitimate.
• Common in criminal activities like narcotics trafficking and fraud.

Three Stages of Money Laundering

1. Placement: Introducing illicit funds into the financial system.
2. Layering: Concealing the source through complex transactions.
3. Integration: Making the funds appear legitimate.

Economic and Social Consequences

• Increases crime and corruption.
• Undermines legitimate sectors, weakens financial organizations, and impacts foreign investments.

AML/CFT Compliance Programs and Individual Accountability

• Regulatory focus on individual accountability at senior levels.
• Importance of a strong compliance culture.
• Personal consequences for non-compliance.

Methods of Money Laundering

• Correspondent Banking: Risks include lack of customer knowledge; requires due diligence.
• Payable-Through Accounts: Direct account access for foreign bank customers; high risk.

Nonbank Financial Institutions

• Credit Card Industry: Often used in layering and integration stages.
• Money Services Business (MSB): Attractive for laundering due to cash intensity.

Nonfinancial Businesses and Professions

• Casinos: Cash-heavy operations vulnerable to money laundering.
• Dealers in High-Value Items: Precious metals and art are high-risk due to ease of transport and high value.
• Real Estate: Used for money laundering through over-/under-valuing properties.

International Trade Activity

• Trade-Based Money Laundering (TBML): Misrepresentation in trade documents to disguise funds.

Risk Associated with New Payment Products and Services

• New technologies (e.g., prepaid cards, virtual currencies) present additional laundering risks.

Terrorist Financing

• Distinction from money laundering: funds can be from legitimate sources.
• Detecting Terrorist Financing: Watch for unusual account activities and international fund movements.

International AML/CFT Standards

• Financial Action Task Force (FATF): Sets global AML/CFT standards.
• FATF Recommendations: Guidelines for effective AML/CFT measures.

FATF-Style Regional Bodies

• Regional versions of FATF to ensure global compliance.

Key US Legislative and Regulatory Initiatives

• USA PATRIOT Act: Enhances laws for preventing money laundering and financing terrorism.
• Section 311: Allows Treasury to impose measures on jurisdictions posing money laundering concerns.

Appendix

• Additional study resources and glossary for further reading and understanding.

These notes outline the main topics and key points from the Certified Anti-Money Laundering Specialist (CAMS) Study Guide Version 6.51. The guide covers a broad range of subjects related to AML/CFT, from introductory concepts to detailed industry practices and regulatory frameworks.