International AFC Standards and Authorities

FATF, the UN, regulators, law enforcement, FIUs, industry and non-government bodies, and how they cooperate and publish guidance.

5 minutes 5 Questions

In the Certified Anti-Money Laundering Specialist (CAMS) framework, 'International AFC Standards and Authorities' refers to the global bodies and standards that shape Anti-Financial Crime (AFC) programs, including anti-money laundering (AML), counter-terrorist financing (CTF), sanctions, and anti-c…

Concepts covered
Basel Committee, IMF and World Bank GuidanceCross-Border Investigations and Mutual Legal AssistanceUsing Typology Reports, Advisories and FIU FeedbackPublic and Private Sector Groups in AFCFinancial Intelligence Units and the Egmont GroupRegulatory Examinations and Supervisory CooperationFATF Role, Mandate and the 40 RecommendationsFATF Mutual Evaluations and the Grey and Black ListsRole of Law Enforcement and ProsecutorsRole of Financial Regulators and SupervisorsApplying the FATF Recommendations in an OrganisationFATF-Style Regional BodiesNon-Governmental Organisations in Anti-Financial CrimeWolfsberg Group Guidance and Industry Special ReportsUnited Nations Conventions and Sanctions Regimes
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CAMS - International AFC Standards and Authorities Example Questions

Test your knowledge of International AFC Standards and Authorities

Question 1

Under the FATF Standards, what should a financial group's foreign branches and majority-owned subsidiaries do when the host country's AML/CFT requirements are less strict than those of the home country?

Correct Answer: Apply home-country measures to the extent host-country law permits

FATF Recommendation 18 requires financial groups to ensure their foreign branches and majority-owned subsidiaries apply AML/CFT measures consistent with home-country requirements, to the extent host-country laws and regulations permit, wherever the host country's requirements are less strict.
Defaulting to host-country measures would let weaker local rules create gaps in group-wide controls. Host supervisor approval is not a precondition for applying stricter home standards. The choice of regime is not determined by a group-wide risk rating. Where host law prevents proper implementation, the group must apply additional measures to manage the risk and inform home supervisors.
Key concept: home-country standards apply to foreign branches and subsidiaries under FATF Recommendation 18.

Question 2

A bank's country risk model draws on intergovernmental and supervisory sources. The head of financial crime risk now wants the corruption factor to include an independent measure of perceived public-sector bribery, produced by a non-governmental organization and covering most countries on a comparable scale. A compliance analyst is asked to propose the input. Which source BEST meets this requirement?

Correct Answer: Transparency International's Corruption Perceptions Index

Transparency International's Corruption Perceptions Index is the right input because it is produced by an independent non-governmental organization and scores perceived public-sector corruption for most countries on one comparable scale.
The Wolfsberg Group correspondent banking questionnaire is an industry due diligence tool for assessing individual respondent banks, not a country corruption ranking. FATF mutual evaluation reports come from an intergovernmental body, assess AML/CFT compliance, and are not issued on a single comparable corruption scale. Egmont Group material covers financial intelligence unit cooperation and typologies, not a country-by-country perception score.
Key concept: choosing independent, comparable public corruption indices as inputs to country risk assessment.

Question 3

An FIU publishes a typology report on funnel accounts. In the pattern it describes, cash is deposited at several branches in different cities and then rapidly wired out to a high-risk jurisdiction. The report lists red flags but names no customers or institutions. The MLRO of a bank asks a compliance analyst how the institution should make use of the report. What is the BEST response?

Correct Answer: Map the report's red flags to existing monitoring scenarios and close any gaps

FIU typology reports are intelligence tools, so the most effective use is to compare the described red flags, such as multi-city cash deposits followed by rapid wires to a high-risk jurisdiction, against existing transaction monitoring scenarios and close any detection gaps.
Filing reports on every customer showing the indicators skips investigation and produces defensive filings, because red flags trigger review, not automatic reporting. Blocking accounts tied to the jurisdiction is blanket de-risking rather than a risk-based response. Circulating the report and adding it to training helps awareness but does not strengthen systemic detection on its own.
Key concept: operationalizing FIU typologies within a risk-based transaction monitoring program.

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