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Certified AML/KYC Compliance Officer VS-1092
Certified AML/KYC
Compliance Officer
VS-1092

Certified AML/KYC Compliance Officer

Certified AML/KYC Compliance Officer CertifiedCertifiedCertifiedCertified AML/KYCAML/KYCAML/KYCAML/KYC

CertifiedCertifiedCertifiedCertified AML/KYCAML/KYCAML/KYCAML/KYC ComplianceComplianceComplianceCompliance OfficerOfficerOfficerOfficer

CertificateCertificateCertificateCertificate CodeCodeCodeCode VSVS-VSVS--1092-109210921092

Vskills certification in KYC (Know Your Customer) and Anti Money Laundering Operation, is one of the first certifications in this area of banking sector. A Vskills Certified AML/KYC Officer finds employment in banking and banking ancillary firms, security and audit firms, and other small and medium enterprises.

WhyWhyWhyWhy shouldshouldshouldshould oneoneoneone taketaketaketake thisthisthisthis certification?certification?certification?certification?

The certification is aimed at enhancing the quality of compliance with the directions of RBI in combating illegal operations and movement of funds through the use of banking channels. KYC and Anti Money Laundering operations have assumed added importance owing to the security risk that it poses to the country, and also to maintain the financial health of the institutions.

WhoWhoWhoWho willwillwillwill benefitbenefitbenefitbenefit fromfromfromfrom takingtakingtakingtaking thisthisthisthis certification?certification?certification?certification?

KYC and Anti Money Laundering certification is being increasingly taken by a large number of working professionals in banking and finance field. Also, students desirous of entering banking and finance sector, find this certification as a useful addition to their CV.

TestTestTestTest Details:Details:Details:Details:

Duration:Duration:Duration:Duration: 60 minutes

No.No.No.No. ofofofof questions:questions:questions:questions: 50

MaximumMaximumMaximumMaximum marks:marks:marks:marks: 50, Passing marks: 25 (50%);

There is no negative marking in this module.

FeeFeeFeeFee Structure:Structure:Structure:Structure:

Rs. 2,500/- (Includes all taxes)

in this module. FeeFeeFeeFee Structure:Structure:Structure:Structure: Rs. 2,500/- (Includes all taxes) www.vskills.in
in this module. FeeFeeFeeFee Structure:Structure:Structure:Structure: Rs. 2,500/- (Includes all taxes) www.vskills.in

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Certified AML/KYC Compliance Officer

Certified AML/KYC Compliance Officer TableTableTableTable ofofofof ContentContentContentContent 1.1.1.1.

TableTableTableTable ofofofof ContentContentContentContent

1.1.1.1. MoneyMoneyMoneyMoney LaunderingLaunderingLaunderingLaundering

1.1 What is Money Laundering?

1.2 Prevention of Money Laundering Act (PML Act)

1.3 Tainted Money or Dirty Money

1.4 Transfer of funds and washing of “Dirty” Money

1.5 Global phenomenon

22.22 MoneyMoneyMoneyMoney Laundering:Laundering:Laundering:Laundering: SomeSomeSomeSome MethodsMethodsMethodsMethods usedusedusedused

2.1 Process of Money Laundering: Placement, Layering, Integration

2.2 Methods used in Money Laundering

2.3 Sources of tainted money

2.4 Common techniques employed

33.33 LegislationLegislationLegislationLegislation andandandand internationalinternationalinternationalinternational cooperationcooperationcooperationcooperation

3.1 Legislations in various countries against money laundering

3.2 Financial Action Task Force (FATF)

3.3 Anti Money Laundering measures in India

3.4 Tools required for prevention of Money Laundering

44.44 RoleRoleRoleRole ofofofof ccorrespondentccorrespondentorrespondentorrespondent bankingbankingbankingbanking

4.1 Information on Correspondent Bank

4.2 Anti money laundering policies of the correspondent bank

5.5.5.5. KnowKnowKnowKnow YourYourYourYour CustomerCustomerCustomerCustomer –––– HistoricalHistoricalHistoricalHistorical PerspectivePerspectivePerspectivePerspective

5.1 Customer Profile

5.2 KYC Policies and RBI initiative

5.3 Some basic definitions and KYC origination

5.4 Transaction Profile screening

5.5 Organizational Structure in the bank

6.6.6.6. KYCKYCKYCKYC –––– OperatingOperatingOperatingOperating GuidelinesGuidelinesGuidelinesGuidelines

6.1 Customer Identification

6.2 Account opening process

6.3 Accounts of Companies – Limited Companies, Proprietorship, Partnerships

6.4 Trusts, fiduciary relations, professional intermediaries

6.5 Joint Accounts

6.6 Suggested safegaurds

6.7 Existing Accounts

6.8 Inoperative Accounts

6.9 Monitoring of Accounts

Accounts 6.6 Suggested safegaurds 6.7 Existing Accounts 6.8 Inoperative Accounts 6.9 Monitoring of Accounts www.vskills.in
Accounts 6.6 Suggested safegaurds 6.7 Existing Accounts 6.8 Inoperative Accounts 6.9 Monitoring of Accounts www.vskills.in

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Certified AML/KYC Compliance Officer

Certified AML/KYC Compliance Officer 77.77 InternalInternalInternalInternal ControlControlControlControl andandandand

77.77 InternalInternalInternalInternal ControlControlControlControl andandandand structurestructurestructurestructure inininin banksbanksbanksbanks

7.1 Roles and responsibilities of the Principal Officer

7.2 Roles and responsibilities of the staff

7.3 Roles and responsibilities of Internal Audit and Controls

88.88 CustomerCustomerCustomerCustomer RiskRiskRiskRisk CategorizationCategorizationCategorizationCategorization (CRC)(CRC)(CRC)(CRC)

8.1 Customer Risk

8.2 Need for Customer Risk Categorization

8.3 Customer Acceptance Policy (CAP)

8.4 Customer Identification Procedures

8.5 Customer due diligence

99.99 ReportingReportingReportingReporting ObligationsObligationsObligationsObligations

9.1 Cash transaction reporting (CTR)

9.2 Counterfeit Currency Reporting (CCR)

9.3 Suspicious Transaction Report (STR)

1101100.0 TransactionTransactionTransactionTransaction MonitoringMonitoringMonitoringMonitoring

10.1 Methods of monitoring

10.2 Suspicious transactions

10.3 Name Screening process

10.4 Wire Transfers

10.5 Preservation of records

1111111.1 StaffStaffStaffStaff andandandand CustomerCustomerCustomerCustomer AwarenessAwarenessAwarenessAwareness

11.1 Training methods

11.2 Assessments

11.3 Records of training

11.4 Importance of creating customer awareness

Training methods 11.2 Assessments 11.3 Records of training 11.4 Importance of creating customer awareness www.vskills.in
Training methods 11.2 Assessments 11.3 Records of training 11.4 Importance of creating customer awareness www.vskills.in

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Certified AML/KYC Compliance Officer

Certified AML/KYC Compliance Officer CourseCourseCourseCourse OutlineOutlineOutlineOutline MoneyMoneyMoneyMoney

CourseCourseCourseCourse OutlineOutlineOutlineOutline

MoneyMoneyMoneyMoney LaunderingLaundering:LaunderingLaundering::: SomeSomeSomeSome MethodsMethodsMethodsMethods UsedUsedUsedUsed

Briefly explains the complex web of money laundering operations

Various steps involved in money laundering like Placement – physically placing bulk cash proceeds, Layering – separating the proceeds of criminal activity from

their origins, through layers of complex transactions, Integration – providing a seemingly legitimate explanation to the illegal proceeds Various methods of money laundering like creating shell companies, front companies, offshore banking accounts, structuring the amounts, and hawala transactions

Common sources of money laundering like drug trafficking, tax evasion, organized crime etc

Studying the various markets in detail that absorb money laundering money like precious metals etc

LegislationLegislationLegislationLegislation andandandand IntInternationalIntInternationalernationalernational CooperationCooperationCooperationCooperation

UK has come up with various legislations like Drug Trafficking Offences (1998),

Criminal Justice Act (1988), Criminal Justice (Consolidation) (Scotland) Act (1995), Proceeds of Crime (Scotland) Act (1995), Criminal Justice (International Cooperation) Act (1990) USA has consistently come out with various acts , and since 9/11 has taken significant steps like USA Patriot Act 2001 giving substantial powers to law enforcing agencies to prevent cross border flow of funds that look suspicious Basel Principles have also addressed four areas that tackle money laundering i.e. customer identification, compliance with laws, cooperation with law enforcing agencies, adherence to the statement

Financial Action Task Force (FATF) was established by G-7 and has come up with

recommendations to help uncover money laundering techniques, to introduce counter manners, and to harmonize anti money laundering policies at an international level In India, The Prevention of Money Laundering Act (2002) addresses the problem

of money laundering in conjunctions with other laws in existence RBI has also come out with certain guidelines for banks and financial institutions to prevent money laundering

Several countries have come up with strict legislations to counter money laundering

Tools are required to study the complex transactions and good software packages are needed along with high quality human resource

RoleRoleRoleRole ofofofof CorrespondentCorrespondentCorrespondentCorrespondent BankingBankingBankingBanking

Importance of properly examining the correspondent bank with which transactions are happening

Importance of properly examining the correspondent bank with which transactions are happening www.vskills.in
Importance of properly examining the correspondent bank with which transactions are happening www.vskills.in

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Certified AML/KYC Compliance Officer

Certified AML/KYC Compliance Officer Gathering all important information about the correspondent bank like other bank’s

Gathering all important information about the correspondent bank like other bank’s management, major business activities, level of KYC and AML norms, etc before extending correspondent facilities to the bank

KnowKnowKnowKnow YourYourYourYour Customer:Customer:Customer:Customer: HistoricalHistoricalHistoricalHistorical PersPerspectivePersPerspectivepectivepective

Importance of KYC activities and appreciating the value of KYC processes in

ensuring that the banking operations are safe and clean to help clients and bank personnel to conduct business, with comfort and confidence Customer Profile and what is the set of important information that needs to be collected

Initiatives taken by the RBI and their impact in the banking business. The RBI’s approach has been chiefly to prevent banks from being used by criminal elements to launder money and to help banks know their customers and their financial transactions better Some of the KYC Policies laid down by RBI include Customer Acceptance Policy (CAP), Customer Identification Process, Monitoring of Customer Transactions and Risk Management RBI also suggests close monitoring of transactions like archival of profiles, scrutiny of unusual transactions, audit and compliance functions, reporting and training.

Understanding the global case and countries that are deficient in KYC norms

KYC:KYC:KYC:KYC: OperatingOperatingOperatingOperating GuidelinesGuidelinesGuidelinesGuidelines

Various guidelines related to customer identification in opening of accounts, monitoring customer transactions, risk management and other matters related to KYC standards. General operating guidelines for customer identification in opening of accounts as in the case of individuals, companies, partnerships, proprietorships, trusts and foundations Concept of an introducer and who can be an introducer and client accounts opened by professional intermediaries

InternalInternalInternalInternal ControlControlControlControl andandandand StructureStructureStructureStructure inininin bankbankbankbank

Internal control in terms of customer research, monitoring of cash transactions,

monitoring remittances, and the parameters used for customer identification Customer research may involve desk research, discussions with customers, periodic

calls to customers etc Research on customer may further be extended using softwares of the bank.

Internal guidelines for new accounts, cash transactions, large value transfer of funds, monitoring remittances

NRI Accounts become important in the light of FEMA, and KYC should be proper

funds, monitoring remittances NRI Accounts become important in the light of FEMA, and KYC should be
funds, monitoring remittances NRI Accounts become important in the light of FEMA, and KYC should be

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Certified AML/KYC Compliance Officer

Certified AML/KYC Compliance Officer Identification parameters need to be established like transactions not consistent

Identification parameters need to be established like transactions not consistent with customer’s usual business, incomplete/non disclosure of data by customer, unusual activity, suspicious fund transfer activity Check on bank employees and their lifestyle, employee discipline and confidentiality of internal control documents

Appointment of Principal officer along with defining the roles and responsibilities, and formulation of appropriate procedures to prevent Money Laundering Roles and responsibilities of the staff and internal audit/ internal control

Roles and responsibilities of Board of Directors and senior management

CustomerCustomerCustomerCustomer RiskRiskRiskRisk CategorizationCategorizationCategorizationCategorization (CRC)(CRC)(CRC)(CRC)

Meaning of Customer risk, and classification of customers in various buckets of risk. Various selection of parameters for risk categorization, determining the risk rating methodology, deciding on type of classification, use of various soft wares for risk categorization, and periodic review of CRC

ReportingReportingReportingReporting ObligationsObligationsObligationsObligations

Under PMLA Act, 2002, certain obligations were cast on banking companies with regards to reporting of certain transactions. Banks are required to make reports of the following types : Cash Transaction Reporting (CTR), Counterfeit Currency Reporting (CCR), Suspicious Transaction Reporting (STR)

TransactiTransactionTransactiTransactiononon MonitoringMonitoringMonitoringMonitoring

Transaction Monitoring is critical to AML/KYC efforts. Various methods of

monitoring are studied like observation, analysis of exception reports, AML software, looking at suspicious transactions Rules for transaction monitoring and challenges for transaction monitoring

Importance of software for transaction monitoring and features available for the software Scope and purpose of name screening and negative lists

StaffStaffStaffStaff andandandand CustomerCustomerCustomerCustomer AwarenessAwarenessAwarenessAwareness

Creating staff awareness of AML/KYC and allocating responsibility to top

management, defining roles and responsibilities and obligations of staff Need for development appropriate training methods and using regular assessments

to gauge performance Maintenance of regular records of training and assessment and why is it important to create customer awareness on AML

of regular records of training and assessment and why is it important to create customer awareness
of regular records of training and assessment and why is it important to create customer awareness

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Certified AML/KYC Compliance Officer

Certified AML/KYC Compliance Officer SampleSampleSampleSample QuestionsQuestionsQuestionsQuestions 1.1.1.1.

SampleSampleSampleSample QuestionsQuestionsQuestionsQuestions

1.1.1.1. MoneyMoneyMoneyMoney LaunderingLaunderingLaunderingLaundering refersrefersrefersrefers totototo

A. Tansfer of assets/cash from one account to another

B. Conversion of illegal money through banking channels

C. Conversion of cash into gold for hoarding

D. Conversion of assets into cash to avoid income tax

2.2.2.2. InInInIn casecasecasecase ofofofof societies,societies,societies,societies, thethethethe importantimportantimportantimportant documentdocumentdocumentdocument totototo bebebebe verifiedverifiedverifiedverified isisisis

A. Copy of bye laws

B. Certificate given by ROC

C. Certificate given by the Local Authorities

D. No document is to be verified in case of societies, as societies are exempted by Registrar

3.3.3.3.

PANPANPANPAN

(Permanent(Permanent(Permanent(Permanent

AccountAccountAccountAccount

Number)Number)Number)Number)

isisisis

RemittancesRemittancesRemittancesRemittances likelikelikelike DDs/TTs/RTCs,DDs/TTs/RTCs,DDs/TTs/RTCs,DDs/TTs/RTCs, etcetcetcetc

A. if the amount exceeds Rs.10,000

B. if the amount exceeds Rs.25,000

C. if the amount exceeds Rs 50,000

D. no such limit is fixed by income tax authorities

compulsorycompulsorycompulsorycompulsory

forforforfor

FiFiFixedFixedxedxed

Deposits,Deposits,Deposits,Deposits,

4.4.4.4. Dormant/Dormant/Dormant/Dormant/ inininin operativeoperativeoperativeoperative accountaccountaccountaccount meansmeansmeansmeans

A. No debits/credits in account for a certain period

B. Dead Account without any operation for long

C. No debit entries, but certain credit entries for a certain period

D. Fixed asset account of the bank

5.5.5.5. WhileWhileWhileWhile openingopeningopeningopening anananan accountaccountaccountaccount ofofofof aaaa PublicPublicPublicPublic LimitedLimitedLimitedLimited compancompancompancompany,y,y,y, whichwhichwhichwhich ofofofof thethethethe followingfollowingfollowingfollowing isisisis aaaa mustmust?mustmust???

A. Introduction by a customer known to the banker

B. Certificate of incorporation/Certificate of commencement of business

C. Introduction by ROC

D. None of the above

Answer:Answer:Answer:Answer: 1111 (B),(B),(B),(B), 2222 ((A((AA),A),),), 3333 ((C((CC),C),),), 4444 ((A((AA),A),),), 5555 ((B((BB)B)))

1111 (B),(B),(B),(B), 2222 ((A((AA),A),),), 3333 ((C((CC),C),),), 4444 ((A((AA),A),),), 5555 ((B((BB)B))) www.vskills.in
1111 (B),(B),(B),(B), 2222 ((A((AA),A),),), 3333 ((C((CC),C),),), 4444 ((A((AA),A),),), 5555 ((B((BB)B))) www.vskills.in

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