Banking Exam

Question 1

A customer makes three separate cash deposits of $4,000, $5,000, and $3,500 into different branches of the same bank on the same business day. Which of the following actions is the bank required to take?

File a Suspicious Activity Report (SAR) for structuring. File a Currency Transaction Report (CTR) because the total exceeds $10,000. Advise the customer that their account will be closed due to suspicious activity. Do nothing, as no single transaction exceeded the $10,000 threshold.

Correct Answer:

File a Currency Transaction Report (CTR) because the total exceeds $10,000.

Question 2

Which of the following scenarios best illustrates the 'layering' stage of money laundering?

A criminal group uses a cash-intensive front business, like a car wash, to co-mingle illicit and legitimate funds. An individual purchases a luxury property with funds that have been moved through various offshore accounts. A 'smurf' deposits $9,500 in cash into a bank account to avoid reporting thresholds. An individual transfers funds through a complex series of wire transfers to multiple accounts in different countries.

Correct Answer:

An individual transfers funds through a complex series of wire transfers to multiple accounts in different countries.

Question 3

Under the Bank Secrecy Act (BSA), a financial institution must file a Suspicious Activity Report (SAR) if it knows, suspects, or has reason to suspect that a transaction of at least what amount involves funds derived from illegal activity?

$$10,000 $$2,000 $$5,000 $$25,000

Correct Answer:

$$5,000

Question 4

What is the primary distinction between Know Your Customer (KYC) and Customer Due Diligence (CDD)?

KYC is performed only for high-risk customers, while CDD is for all customers. KYC focuses on ongoing transaction monitoring, while CDD is a one-time identity verification at onboarding. KYC is the initial process of identifying and verifying a customer's identity, while CDD is the ongoing process of assessing that customer's risk. KYC is mandated by the USA PATRIOT Act, while CDD is a recommendation from the Financial Action Task Force (FATF).

Correct Answer:

KYC is the initial process of identifying and verifying a customer's identity, while CDD is the ongoing process of assessing that customer's risk.

Question 5

An effective OFAC (Office of Foreign Assets Control) compliance program within a bank should include all of the following EXCEPT:

Screening new customers and transactions against OFAC sanctions lists. Blocking or rejecting transactions with sanctioned individuals or entities. Appointing a dedicated BSA Officer, separate from any OFAC compliance responsibilities. Conducting a periodic, risk-based assessment of its exposure to sanctioned parties.

Correct Answer:

Appointing a dedicated BSA Officer, separate from any OFAC compliance responsibilities.

Question 1

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About this Exam

Prepare with the Banking Exam practice quiz. This question bank includes 100 questions covering bank, customer, primary, deposits, and loan. Use it to review important concepts, identify knowledge gaps, and build confidence for the related exam, course, or assessment.

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Banking Exam

This practice set contains 100 questions from the matching question bank and focuses on bank, customer, primary, deposits, and loan. Work through each question carefully, review the provided solutions, and revisit topics that need more study before your next attempt.

This is an independent study resource intended for practice and review; it is not an official examination or an endorsement by any organization named in the title.

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Banking Exam

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