CAMS practice question 23 of 35

An offshore company is owned by four equal partners that reside in separate jurisdictions. One partner presents an authenticated power of attorney…

Choose your answer, then check it against the explanation.

An offshore company is owned by four equal partners that reside in separate jurisdictions. One partner presents an authenticated power of attorney apparentlyexecuted by the remaining three partners in his favor and requests that a bank account be opened on behalf of all partners. He needs this done quickly because there is a large deposit pending. The account-opening officer contacts the bank's anti-money laundering officer for advice. Which of the following should the anti-money laundering officer advise as an initial step?

Answer options

Correct Answer:

Explanation

The anti-money laundering officer should advise the account-opening officer to verify the identity of

all the partners as an initial step. This is because opening a bank account for an offshore company

with multiple owners from different jurisdictions poses a high risk of money laundering and terrorist

financing. Therefore, the bank should apply enhanced due diligence measures to ensure that the

offshore company and its owners are legitimate and not involved in any criminal activities. One of

the key measures is to verify the identity of all the partners, not just the one who presents the power

of attorney. This will help the bank to establish the beneficial ownership and control structure of the

offshore company, as well as to detect any possible fraud, forgery, or coercion in the power of

attorney document. The bank should also verify the authenticity and validity of the power of

attorney, and the scope and purpose of the authority granted to the partner who requests the

account opening.

The other options are less important or irrelevant as initial steps. Verifying the source of the deposit

is also a part of the enhanced due diligence process, but it should be done after verifying the identity

of the partners and the offshore company. Filing a suspicious transaction report with the appropriate

Financial Intelligence Unit or the Egmont Group is a possible action that the bank may take if it

detects any indicators of money laundering or terrorist financing in the account opening process, but

it is not an initial step. The Egmont Group is an international network of Financial Intelligence Units

that facilitates information exchange and cooperation, but it is not a reporting authority.

ACAMS Study Guide, Chapter 3: Customer Identification and Verification, 1

ACAMS Study Guide, Chapter 4: Customer Risk Assessment, 2

ACAMS Study Guide, Chapter 5: Ongoing Monitoring, 3

Powers of attorney: opening a bank account, 4

Question 23 of 35

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