PCS AML

1.

1 point

If a suspicious transaction is found to be justified, where should PCS submit the Suspicious Transaction Report (STR) to?

JLT Group

Regulators

Commercial Affairs Department (Singapore) / Joint Financial Intelligence Unit (Hong Kong)

2.

1 point

What are possible money-laundering red flags?

Client has a defensive stance to questions

Client questions reporting/ recordkeeping requirements

Client surrenders a policy soon after purchase with no apparent reason, and purchases another similar policy within a short time.

Client's lack of concern with the cost of the policy

Client's lack of concern with the poor performance of an insurance product

Client's lack of concern at the time of surrender about the surrender charges.

Policy payments are made by apparently unrelated third parties

Exercise of free look and refusing to give any reasons

Policy is assigned to an unknown third party soon after purchase

3.

1 point

Indicate whether the following statement is True or False. In accordance with Section 25 of the Drug Trafficking (Recovery of Proceeds) Ordinance (DTROP), the maximum penalty is HK$5 million fine and 14 years imprisonment.

True

False

4.

1 point

If the Payor, Policy Applicant (PIC), Insured, Beneficiary, Beneficial Owner are all different persons in relation to an insurance policy, which of the following person(s) is/are the subjects of JLTPCS’s source of funds inquiries?

Beneficial Owner

Policy Applicant

Payor

Insured

5.

1 point

Indicate whether the following statement is True or False.
Terrorist organisations can obtain money to fund their activities from legitimate organisations such as charities and religious groups.

True

False

6.

1 point

What is the scope of the HK Organised and Serious Crimes Ordinance (OSCO)?

Allows the confiscation of the proceeds of organized and serious crimes

Investigation of property that are known or suspected to associate with drug trafficking activities

Confiscation of the proceeds upon conviction

Extends the government’s power to investigate the activities of organized crime

Freezing of property on arrest

7.

1 point

The maximum penalty under the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance (AMLO) for an individual offender is:

Fine of < HK$500,000 and imprisonment < 2 years

Fine of < HK$1 million and imprisonment < 7 years

Fine of < HK$1 million and imprisonment < 5 years

8.

1 point

Which of the following are Hong Kong statutory provisions related to the AML/ CFT in Hong Kong?

Anti-Money Laundering Ordinance (AMLO)

Drug Trafficking (Recovery of Proceeds) Ordinance (DTROP)

United Nations (Anti-Terrorism Measures) Ordinance (UNATMO)

Organized and Serious Crimes Ordinance (OSCO)

9.

1 point

What are the common sources of terrorist financing?

Corruption

Drug Trafficking

Tax evasion

10.

1 point

Indicate whether the following statement is True or False.
The Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance (AMLO) makes money laundering an offence. In addition, it sets out obligations on financial institutions to conduct Customer Due Diligence (CDD) and keep records of the CDD performed.

True

False

11.

1 point

Who do you report a Suspicious Transaction to?

Board of Directors

Senior Management

Compliance / Money Laundering Reporting Officer

Human Resource

12.

1 point

What is the maximum penalty for contravention of the HK United Nations (Anti-Terrorism Measures) Ordinance?

Fine of < HK$5 million and imprisonment < 14 years

Fine of < HK$500,000 and imprisonment < 2 years

Fine of < HK$1 million and imprisonment < 10 years

13.

1 point

Indicate whether the following statement is True or False.
Criminals almost always launder money solely through banks and other financial institutions. Therefore anti-money laundering compliance is not a serious issue for other types of businesses.

True

False

14.

1 point

At which points are business relations commenced in JLTPCS’s business:

When a JLTPCS makes a formal submission for an insurance policy.

When a JLTPCS staff advises a prospect concerning his insurance needs and advises him on possible suitable products.

When a JLTPCS asks an insurer for a firm quote.

When a JLTPCS staff first meets a prospect and commences concept selling.sanction country

When a JLTPCS staff makes arrangement for the prospect to undergo a medical examination for the purpose of an insurance application.

15.

1 point

Which of the following are Politically Exposed Persons, under Singapore and Hong Kong regulatory requirements?

Children of the first three options above

Senior executives of state-owned corporations

Head of state, a head of government, government ministers and ambassadors

A natural person who is or has been entrusted with prominent public functions anywhere in the world.

Grandchildren of the first three options above

16.

1 point

Indicate whether the following statement is True or False.
Money launderers are generally criminals trying to hide money from the drug trade.

True

False

17.

1 point

What is the scope of the Singapore Terrorism (Suppression of Financing) Act?

Use or possession of property for terrorists

Dealing with property of terrorists

Providing or collecting funds for terrorist acts

Providing resources and services for terrorist purposes

18.

1 point

What of the following information/checks are NOT required in the event of a policy surrender?

Conduct World-Check on the Beneficial Owner

Conduct World-Check on the insured

Obtain identity and address proof on the Beneficial Owner

Obtain identity and address proof on the Policyholder

19.

1 point

How is verification of an individual’s identity performed:

Using reliable and independent sources

Meeting the individual face-to-face.

Requesting for documentary proof

20.

1 point

What is the scope of the HK Drug Trafficking (Recovery of Proceeds) Ordinance (DTROP)?

Extends the government’s power to investigate the activities of organized crime

Allows the confiscation of the proceeds of organized and serious crimes

Freezing of property on arrest

Investigation of property that are known or suspected to associate with drug trafficking activities

Confiscation of the proceeds upon conviction

21.

1 point

Indicate whether the following statement is True or False.
Financial institutions only need to identify and verify new customers.

True

False

22.

1 point

Which of the following person is always the Beneficial Owner of a PIC/Trust?

Shareholder

Settlor

Natural person who ultimately owns or controls the person or the person on whose behalf a transaction is being conducted

Director

23.

1 point

Which of the following is/are NOT acceptable proof(s) of identity?

Bank Statement

Passport

Bank reference letter

Identity card

24.

1 point

Which of the following can you presume to be the Beneficial Owner of a PIC/Trust, unless there is contrary evidence?

Insured

Natural person with at least 10% ultimate ownership in the relevant entity

Natural person with at least 25% ultimate ownership in the relevant entity

Settlor

25.

1 point

What should you do if the MT103 indicates that the premium payment is not made by a person, previously notified to you by the Policy Applicant?

Inform the Policy Applicant immediately, and request for the relevant information to be provided within 30 business days. Otherwise, inform the insurer.

Inform the insurer immediately

Inform Compliance immediately.

Inform the Policy Applicant immediately, and request for the relevant information to be provided within 30 business days. Otherwise, inform Compliance.

26.

1 point

Which are the stages of money laundering?

Whitening

Legitimising

Entering in the system

Integration

Layering

Placement

27.

1 point

Which of the following are possible sources of wealth of a client or beneficial owner? Tick as many answers as are applicable.

Employment

Savings

Inheritance

Investment

Business income

28.

1 point

A banker approaches you to apply for an insurance policy for a very special client of his. The banker makes it clear that the client has illegally obtained money and wishes to use the money for the insurance purchase. What do you do?

Accept the business

Warn the banker that you will be reporting the matter to JLTPCS Compliance and then report the matter.

Report the matter to JLTPCS Compliance.

Tell the banker that you are unable to help as this is a clear case of money laundering.

29.

1 point

Which one of the following is likely to be a suspicious activity/ activities?

Client is reluctant to provide the necessary KYC information or documents.

Over-payment to the company with a request to refund the excess to a third party account.

Surrender of policy within a short period

30.

1 point

The stage in which money is dispersed and disguised in the system is known as:

Placement

Layering

Integration

31.

1 point

Which of the following are appropriate ways to assess the inherent Money Laundering and Terrorism Financing risks that a relationship with a customer may present?

Considering their ethnic or cultural background

Both of the above

Reviewing the type of customer (individual, company, trust, etc.)

Reviewing the type of service they want to use

32.

1 point

What is the only circumstance under which JLTPCS be excused from conducting Customer Due Diligence on the beneficiaries at the time of inception of the policy?

If the policy applicant is a corporate trustee or PIC owned by a corporate trustee under a discretionary trust

If the policy or trust beneficiaries are designated by description or other means or is otherwise not identifiable

If the policy applicant is a corporate trustee or PIC owned by a corporate trustee regulated in Singapore or Hong Kong

If the policy applicant is a corporate trustee or PIC owned by a corporate trustee is affiliated to a major financial institution headquartered in Singapore, Hong Kong, Switzerland, UK or the USA.

If the policy or trust beneficiaries are identified by name only

33.

1 point

Where an employee acts in such a way as to notify a client that a Suspicious Transaction Report (STR) has been filed on their account, this action is known as:

Witness interference

Layering

Tipping off

34.

1 point

The stage of money laundering at which illicit money becomes indistinguishable from legitimate funds and can be reinvested is called:

Placement

Integration

Layering

35.

1 point

In the event that the Payor of the premiums is not the insured, Policy Applicant or the Beneficial Owner, what types of information are you required to obtain?

Information on the Payor’s relationship to the insured

Address proof of the Payor

Source of funds

Source of wealth of the Payor

Identity proof of the Payor

Passport number of the Payor

Name of the Payor

36.

1 point

Which of the following is NOT a trigger event for the purposes of conducting further Customer Due Diligence checks?

Change of Policyholder

Change of Beneficial Owner

Payment of additional premium (renewal or top-up)

JLTPCS changes its KYC documentation requirements

37.

1 point

If you detect a money laundering red-flag, what should you do?

Inform Compliance immediately

Inform Compliance and Senior Management immediately

Reject the business or client request

Let the client know that this is improper conduct

Ask the clients questions to obtain further information, document the answers and your observations in a file note or email, and inform Compliance and Senior Management if you suspect money laundering.

38.

1 point

When a staff reports suspicious transactions to the Compliance/ Money Laundering Reporting Officer, he/she should:

Not inform anyone else

Let the client know

Let the introducer/banker know

39.

1 point

Indicate whether the following statement is True or False.
Tipping off is an offence under both Singapore and Hong Kong legislation, carrying a maximum penalty of both a fine and prison term.

True

False

40.

1 point

Indicate whether the following statement is True or False. In accordance with HK Organised and Serious Crimes Ordinance (OSCO), the maximum penalty is HK$5 million fine and 14 years imprisonment.

True

False

41.

1 point

When is Enhanced Customer Due Diligence conducted?

Whenever it is disclosed to you that any of the Insured, Policy Applicant, Beneficiary, Beneficial Owner or Payor is employed or have business dealings in higher risk business sectors, such as casinos, money changers, manufacture or trading in arms and ammunition, trading in antiques, diamonds, precious stones and gold.

Whenever screening reveals that there is a hit on the name of the Insured, Policy Applicant, Beneficiary, Beneficial Owner or Payor

Where the policy applicant is a trust, private investment company (PIC) or nominee/ bearer shares type of ownership structure.

Where the policy applicant is a trust, private investment company (PIC) or nominee/ bearer shares type of ownership structure and the payor appears unusual or excessively complex with no apparent legitimate commercial or economic rationale.

Whenever the client discloses that any of his parents, spouse or siblings is a politician.

42.

1 point

What are the possible answers you would be looking for when you ask your client about the source of funds? Tick as many answers as you think are applicable.

Savings

Savings accumulated from previous employment or business

Gift from father

Inheritance from father who accumulated the funds from his business

Business operations

43.

1 point

What is the scope of the Singapore Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act?

Assisting another to retain benefits from criminal conduct

Tipping off

Concealing or transferring benefits of drug trafficking

Assisting another to retain benefits of drug trafficking

Concealing or transferring benefits of criminal conduct

44.

1 point

What are the components of PCS’s AML process?

Identification, Verification of Client’s identity, Screening, Approval of cases requiring Enhanced Customer Due Diligence by Senior Management, Identifying source of funds and identifying source of wealth of clients.

Identification and verification of Clients, Risk Assessment, Approval of cases requiring Enhanced Customer Due Diligence by Compliance, Identifying source of funds, identifying source of wealth of clients and ongoing monitoring.

Identification and verification of Clients, Approval of cases requiring Enhanced Customer Due Diligence by Senior Management, Identifying source of funds, identifying source of wealth of clients and ongoing monitoring.

Identification of Clients, Verification of Client’s identity, Risk Assessment (Screening), Approval of cases requiring Enhanced Customer Due Diligence by Senior Management, Identifying source of funds, identifying source of wealth of clients and ongoing monitoring.

45.

1 point

The stage of money laundering at which illicit money first enters the financial system is called:

Integration

Placement

Layering

46.

1 point

What is the scope of the HK United Nations (Anti-Terrorism Measures) Ordinance?

Prohibits the provision of funds by a person to be used for terrorism

Power to freeze property of terrorists

Prohibits any person within Hong Kong from providing or collecting funds for terrorists, and requires disclosure of suspected terrorist property

47.

1 point

Indicate whether the following statement is True or False.
Money laundering only refers to the laundering of illegal funds and not illegal assets.

True

False

48.

1 point

What is the maximum penalty for contravention of the Singapore Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act?

Individual offender: Fine < S$500,000 and imprisonment < 7 years

Individual offender: Fine < S$1,000,000 and imprisonment < 10 years

Corporate offender: Fine < S$1,000,000

Corporate offender: Fine < S$500,000

49.

1 point

How does PCS perform ongoing monitoring?

Whenever sanction lists are updated, all relevant names in PCS’s database will be checked against the new names added.

During the annual review, PCS staff ask bankers and introducers whether there are any updates to the policyholder’s relevant information.

During the annual review, JLTPCS staff makes a request to the policyholder for the update of relevant information.

During the annual review, the names of insureds, beneficiaries, policyholders and beneficial owners are screened on Worldcheck.

50.

1 point

Examples of insurance transactions which are prohibited include:

Returning surrender payment to a sanctioned person

Naming a resident/citizen of a sanctioned country as a beneficiary under a life insurance policy

Application for an insurance policy by with a person residing in a sanction country

Accepting payment from a resident/citizen of a sanctioned country