A student contacts a real estate broker to view a home but cancels last minute due to illness. The student wants to quickly buy the 800,000 USD home, which is overvalued, despite the broker'sobjections to the asking price. Which real estate red flags should the broker identify? (Select Three.)

The scenario presents several classic money laundering red flags in the real estate sector. The student's profile is inconsistent with the purchase of an expensive 800,000 USD home (Inconsistency). The willingness to purchase an overvalued property without negotiation is a key indicator, as it allows for a larger amount of illicit funds to be integrated into the legitimate economy (Value). The desire to complete the transaction quickly, combined with a lack of due diligence (canceling the viewing), suggests the primary motive is to move funds rather than acquire a suitable property (Transaction speed).

A. Anonymity: The scenario does not indicate the student is attempting to hide their identity through shell companies, trusts, or other complex structures.
B. Structuring: Structuring involves breaking a large transaction into smaller amounts to evade reporting thresholds; this scenario describes a single, large-value transaction.
D. Flow through: This typically refers to funds rapidly passing through an account or entity, which is not the primary activity described in this property purchase scenario.

1. Financial Action Task Force (FATF). (2008, June). Money Laundering & Terrorist Financing Through The Real Estate Sector. FATF-GAFI.

Reference for C (Value): Page 21, Paragraph 56, Indicator (b) lists "Significant or unusual over- or under-valuation of the property."

Reference for E (Inconsistency): Page 21, Paragraph 56, Indicator (d) lists "The property is purchased by a person who is not a resident of the country and whose profile seems inconsistent with the value of the property (e.g. a student)."

Reference for F (Transaction speed): Page 21, Paragraph 56, Indicator (g) lists "The transaction is completed with unusual speed and a lack of concern on the part of the purchaser."

2. Association of Certified Anti-Money Laundering Specialists. (2020). CAMS6-AU Certification Exam Study Guide (6th ed.).

Reference for C, E, F: Chapter 2, "The Methods of Money Laundering and Terrorist Financing," under the "Real Estate" section, identifies key red flags including: purchasing property above market value, a client's profile being inconsistent with the transaction size, and unusual haste to complete the transaction.

Reference for B (Structuring): Chapter 2 defines structuring as the "act of parceling what would otherwise be a single transaction into a series of smaller transactions that fall below a certain quantitative threshold." This contradicts the scenario.