Indian Institute of Banking & Finance
Sample questions for AML & KYC
1.The amount
beyond which cash transactions (Receipts & Payments) are to be monitored by
the Commercial Banks as stipulated by the RBI in its guidelines is -
A.Rs.5 lacs & above B.
Rs.8 lacs & above C. Rs.10 lacs & above D. No such limit
2. Submission of
details of PAN (Permanent Account Number) is compulsory for Fixed Deposits,
Remittances, such as, DDs / TTs/ Rupee TCs, etC., if the amount exceeds –
A. Rs.10,000/- B. Rs.25,000/- C.
Rs.50,000/- D. No such limit
3. Branches
should not open deposit/advances accounts of banned/ terrorist organisations as
circulated by -
A.IRDA B. SEBI
C. AMFI D. FIU
4. FCRA means - Foreign Contribution Regulation Act
5. Maximum
punishment by way of imprisonment for the offence committed under Money
Laundering Act is -
A.
7 years B. 9 years C.
10 years D. 12 years
6. “Smurfing”
means -
A. large number of cash deposits into same
account
B. one voucher for high value
deposit
C. low value denominations of
cash D. None of the above
7. The objective
of verifying the employee life-styles by the employer is -
A.
to know the source of income
B.
to ascertain whether the employee is having any contacts with illegal
organisations
C.
to ascertain whether the employee is assisting organisations banned by statutory
authorities D. All of these
8. Role of the
concurrent auditors / Internal auditors with KYC is to -
A.
Review of compliance of KYC guidelines
B. Effectiveness of the
implementation of the KYC
C. Verification of newly
opened accounts and their transactions
D. All of the above
9. Strict
adherence to KYC norms is achieved through -
A.
following the statutory authority guidelines
B. identification of
customers with appropriate documents
C. strict Implementation of
the Banks Systems and procedures while opening the accounts
D. All of the above
10.Name the
software available in the market for KYC implementation -
A.
Bank Master B. Tally C. Bank Alert D. Bank Call
11. Which of the
following transactions is/are not consistent with a salaried customer’s
account?
A.
Frequent deposits of cash in large sums by third parties
B.
Deposit of cheques issued by foreign companies
C.
High value transactions routed through the account with high frequency
D. All of the above
12. Which of the
following transactions is/are suspicious from AML angle -
A.
Large volume of credits happen through DDs/TTs/BC etC.,
B.
Deposit of several small values of cheques
C.
Frequent deposits of cash into the account by persons other than the account
holder or his authorised representative
D. All of the above
13. While
accounts are transferred from one branch to another, the receiving branch is
expected to comply with KYC Norms. Which one of the following is/are correct in
this regard?
A.
Detailed verification of Customer Profile as received from the earlier branch
is to be done with caution
B.
Detailed verification is not needed but the account is opened immediately and
informed to the customer
C. Fresh details are to be obtained and a
fresh customer profile is to be prepared
D.
No transaction is to be permitted for the first six months till the customer is
fully know to the bank
14.One of the
sources that is available to identify the correctness of the information given
by the New Customer of the Commercial Bank is -
A.Introduction given by the
existing customer of the Bank
B.
By studying the account opening form
C. By providing information by the agencies
like CRISIL
D.
None of the above
15. Which of the
following is a source of identification of new customer who is not having any
valid documents such as, passport, etC.
A. Introduction from the third person
having an account with the bank /branch
B.
Introduction given the Safe deposit locker holder of the bank
C.
Self–declaration given by the new customer along with other opening forms
D.
None of the above
16. Is India a
member of FATF?
A.
Yes B.
No C. Has applied for inclusion D. Is likely to be made a member
17. Is adopting
Anti Money Laundering practices compulsory for Banks in India?
A. Yes B.
No C. Not Sure D. Will be made compulsory soon
18. Letter of
thanks is sent to introducer/s because it is -
A.
laid down in the banks’ manual
B.
a routine practice followed by banks for years
C. recommended by the Auditors of banks
D. assisting banks in verification of
genuineness or otherwise of the address
19. Which of the
following is the cardinal rule for bankers in anti-money laundering efforts -
A. Know Your Customer & Know Your
Employee
B
Know the Customer of the other Banks
C.
Know the income of the Customers of your Bank
D.
Know the Assets Position of the customers of the Bank
20. Money
Laundering means -
A.
Conversion of assets to invest in Laundromats
B. Conversion of money which is illegally
obtained to make them legitimate
C.
Conversion of cash into gold to make them legitimate
D.
Conversion of assets into cash to make them legitimate
21. While
opening an account in the name of a company, the following document/s is/are to
be obtained -
A.
Organisation Chart of the company
B.
Roles and responsibilities of the Company
C. Memorandum and Articles of
Association of the Company
D.
Instructions of the Registrar of the Compan
22. How many
recommendations were made by FATF on anti money laundering -
A.
65 recommendations B. NIL
C. 40
recommendations D. Yet to be
finalised
23. For opening
accounts in the case of Joint Hindu Undivided Family (JHUF), the following
document/s is/are important -
A.
Declaration of all family members
B. Declaration of the Karta of the family
C.
Declaration of all guardians on behalf of minors
D.
Declaration can be exempted as per Hindu Succession Act
24. While
opening an account in case of partnership firm, one of the vital document to be
produced by the firm is -
A.
Partners MOU B. Partnership Deed
C. Registration certificate of Partnership D. Signatures of the partners
25. Cash cannot
be accepted for issue of DDs/TTs/Rupee TCs from the customers for Rs. ____
A.
Rs.50,000/- & above B.
Rs.75,000/- & above
C.
Rs.1,00,000/- & above D.
Rs.1,50,000/- & above
26. The branches
of commercial banks should report suspicious transactions to -
A. Bank’s respective authority B. RBI C.
Ministry of Finance D. None of the
above
27. Maximum
punishment by way of imprisonment for the offence committed under Money
Laundering Act is -
A.
7 years B.9 years C.
10 years D. 12 years
29. Maximum
retention period of the bank records in case of suspicious transactions is -
A.
5 years B. 7 years C.
10 years D. 15 years
30.Four eyes
concept means -
A.
opening and verifying of account by one person two times
B. opening and verifying of
account by electronic device/s
C. opening and verifying of account by two
different persons
D.
none of the above
31. Role of the
concurrent auditors / Internal auditors with KYC is to -
A. Review of compliance of KYC
guidelines
B.
Effectiveness of the implementation of the KYC
C.
Verification of newly opened accounts and their transactions
D. All of the above
32. Role of the
front line employees of a bank in respect of KYC guidelines is to -
A. Identify customers as per the existing
instructions
B.
Serve with Smile while opening the customer accounts
C.
Assist the customer in filling-up the account opening forms
D.
Provide efficient customer service
33. Which of the
following transactions is/are not consistent with a salaried customer’s
account?
A.
Frequent deposits of cash in large sums by third parties
B.
Deposit of cheques issued by foreign companies
C.
High value transactions routed through the account with high frequency
D. All of the above
34.Which of the
following transactions is/are suspicious from AML angle -
A.
Large volume of credits happen through DDs/TTs/BC etC.,
B.
Deposit of several small values of cheques
C.
Frequent deposits of cash into the account by persons other than the account
holder or his authorized representative
D. All of the above
35. While
accounts are transferred from one branch to another, the receiving branch is
expected to comply with KYC Norms. Which one of the following is/are correct in
this regard?
A.
Detailed verification of Customer Profile as received from the earlier branch
is to be done with caution
B.
Detailed verification is not needed but the account is opened immediately and
informed to the customer
C. Fresh details are to be obtained and a
fresh customer profile is to be prepared
D.
No transaction is to be permitted for the first six months till the customer is
fully know to the bank
36. Unusual
activities in respect of an customers account is/are -
A.
Opening of account at a place other than the place of work
B.
Frequent deposits of large sums of money bearing labels of other banks into the
account
C.
Request for closure of newly opened accounts where high value transactions are
routed through D. All of the above
37. For
effective implementation of “Know Your Employee”, measures to be adopted by the
banks are -
A. Verification of the life-styles of the
employees
B.
Proper Job-rotation in work environment
C.
Not allowing frequent cheque purchase to the employees by the employer
D.
All of the above
39.Indicator/s
about the suspicious transactions of a customer accounts is/are -
A.
Depositing high value third party cheques endorsed in favour the account holder
B.
Sudden increase in cash deposits
C.
Receipt or payment of large sums of cash, which have no obvious purpose
D. All of the above
40.Which of the
following document/s that can be accepted by the Banks as a proof of Customer
Identification -
A.
Electricity Bill B.
Salary Slip
C. Income/Wealth Tax Assessment Order D. All of the above
41.Which of the
following is a source of identification of new customer who is not having any
valid documents such as, passport, etC.
A. Introduction from the third person having
an account with the bank /branch
B.
Introduction given the Safe deposit locker holder of the bank
C.
Self–declaration given by the new customer along with other opening forms
D.
None of the above
42. KYC is --
A.
A One-time project B.
To be carried out every 5 years
C.
To be carried out every 2 years D. An ongoing process
43. Is India a
member of FATF?
A.
Yes B.
No C. Has applied for inclusion D. Is likely to be made a member
44.What is the
level of risk of Money Laundering in a Liability product (e.g., deposits)?
A.
Generally High B. Medium C. Generally Low D.
Cannot say
45.Letter of
thanks is sent to introducer/s because it is -
A.
laid down in the banks’ manual B.
a routine practice followed by banks for years
C. recommended by the Auditors of
banks
D. assisting banks in
verification of genuineness or otherwise
of the address
46.While opening
an account in the name of a company, the following document/s is/are to be
obtained - A. Organisation Chart of
the company B. Roles and responsibilities
of the Company
C. Memorandum and Articles of Association of the Company
D. Instructions of the Registrar of the Company
47.Due diligence
is done at the time of opening an account to enable banks to ensure -
A.
identification of the customer at the time of opening an account
B.
correctness of the various denominations of notes given by the customer while
opening an account
C.
authenticity of the signatures of the customer at the time of opening an
account
D.
speeding up the process of account opening of the new customers
48. For opening
accounts in the case of Joint Hindu Undivided Family (JHUF), the following
document/s is/are important -
A.
Declaration of all family members B. Declaration of the Karta of the family
C.
Declaration of all guardians on behalf of minors
D.
Declaration can be exempted as per Hindu Succession Act
49. While
opening an account in case of partnership firm, one of the vital document to be
produced by the firm is -
A.
Partners MOU B. Partnership Deed C. Registration certificate of Partnership
D.
Signatures of the partners
50. The amount
beyond which cash transactions (Receipts & Payments) are to be monitored by
the Commercial Banks as stipulated by the RBI in its guidelines is -
A.
Rs.5 lacs & above B. Rs.8 lacs
& above C. Rs.10 lacs & above D.
No such limit
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51. Submission
of details of PAN (Permanent Account Number) is compulsory for Fixed Deposits,
Remittances, such as, DDs / TTs/ Rupee TCs, etC., if the amount exceeds -
A.
Rs.10,000/- B. Rs.25,000/- C. Rs.50,000/- D. No such limit
52. The branches
of commercial banks should report suspicious transactions to -
A. Bank’s respective authority B. RBI C.
Ministry of Finance D. None of the
above
53. Banks are
made accountable for opening an account in the name of terrorist organisation
under ------ of POTA 2002
A.
Section 16 B. Section 20 C.
Section 18 D. None of the above
54.Which of the
following is/are the terrorist organisation/s notified under POTA, 2002
A.
Khalistan Zindabad Force B. Deendar
Anjuman C. All Tripura Tiger Forc D. All of these
55. FCRA means -
A.
Foreign Currency Regulation Act B. Foreign Contribution Regulation Act
C.
Foreign Cheques / Commodities Regulation Act D.
None of the above
56. Dormant /
In-operative account means -
A.
No debits / credits in account for certain period
B.
A dead account not operated for over 10 years
C. No debit entries, but certain credit
entries for certain period
D. A fixed asset account
57. The
objective of verifying the employee life-styles by the employer is -
A. to know the source of income
B.
to ascertain whether the employee is having any contacts with illegal
organisations
C.
to ascertain whether the employee is assisting organisations banned by
statutory authorities
D. All of these
58. Maximum
retention period of the bank records in case of suspicious transactions is -
A.
5 years B. 7 years C.
10 years D. 15 years
60. Role of the
front line employees of a bank in respect of KYC guidelines is to -
A. Identify customers as per the existing
instructions
B.
Serve with Smile while opening the customer accounts
C.
Assist the customer in filling-up the account opening forms
D.
Provide efficient customer service
61. Name the
software available in the market for KYC implementation -
A.
Bank Master B. Tally C. Bank Alert D. Bank Call
62. Unusual
activities in respect of an customers account is/are -
A.
Opening of account at a place other than the place of work
B.
Frequent deposits of large sums of money bearing labels of other banks into the
account
C.
Request for closure of newly opened accounts where high value transactions are
routed through D. All of the above
63. A new
customer may be identified through -
A.
Passport B. Election ID Card C, PAN Card D. All of the above
64. One of the
sources that is available to identify the correctness of the information given
by the New Customer of the Commercial Bank is -
A.
Introduction given by the existing customer of the Bank
B.
By studying the account opening form
C. By providing information by the agencies
like CRISIL D. None of the above
65. Objective of
KYC guidelines issued by RBI is -
A. To control the financial frauds/money
laundering
B.
To discourage opening of new accounts
C.
To increase competition among the public sector and private sector banks
D.
To check / control over the new accounts
66. Which of the
following document/s that can be accepted by the Banks as a proof of Customer
Identification -
A.
Electricity Bill B. Salary Slip C. Income/Wealth Tax Assessment Order D. All of the above
67. Which of the
following is a source of identification of new customer who is not having any
valid documents such as, passport, etC.
A. Introduction from the third person
having an account with the bank /branch
B.
Introduction given the Safe deposit locker holder of the bank
C.
Self–declaration given by the new customer along with other opening forms
D.
None of the above
68. Is adopting
Anti Money Laundering practices compulsory for Banks in India?
A.
Yes B. No C. Not Sure D. Will be made compulsory soon
69. Letter of
thanks is sent to introducer/s because it is -
A.
laid down in the banks’ manual
B.
a routine practice followed by banks for years
C.
recommended by the Auditors of banks
D. assisting banks in verification
of genuineness or otherwise of the address
70. Which of the
following is the cardinal rule for bankers in anti-money laundering efforts -
A. Know Your Customer & Know Your
Employee
B.
Know the Customer of the other Banks
C.
Know the income of the Customers of your Bank
D.
Know the Assets Position of the customers of the Bank
71. While
opening an account in the name of a company, the following document/s is/are to
be obtained -
A.
Organisation Chart of the company B.
Roles and responsibilities of the Company
C. Memorandum and Articles of Association
of the Company
D.
Instructions of the Registrar of the Company
72. FATF means -
Financial Action Task force
73. One of the
important steps to be taken while opening NRI accounts is ……… by the bank
branch
A. Authentication / verification of
signature by Indian Embassy
B.
Authentication / verification of signature made by the relative of NRI in India
C.
Authentication / verification of signature made by friends of the NRI who are
staying abroad D. All
of the above
74.In case of
societies, the important document to be verified is -
A. Copy of Bye-Laws B. Certificate given by the ROC
C. Certificate given by the Local Authorities
D. No document is to be verified in case of societies, as it is
exempted
75. The amount
beyond which cash transactions (Receipts & Payments) are to be monitored by
the Commercial Banks as stipulated by the RBI in its guidelines is -
A.
Rs.5 lacs & above B. Rs.8 lacs
& above C. Rs.10 lacs & above D.
No such limit
76.In computerised branches, suitable filters
are required in the software for the purpose of -
A.
calculating the correct rate of interest B.
printing out the customer profiles
C. monitoring the suspicious transactions D. sharing information/data to the Head
Office
77.Banks are
made accountable for opening an account in the name of terrorist organisation
under ------ of POTA 2002
A.
Section 16 B. Section 20 C.
Section 18 D. None of the above
78. FCRA means -
A.
Foreign Currency Regulation Act B. Foreign Contribution Regulation Act
C.
Foreign Cheques / Commodities Regulation Act D.
None of the above
79. Maximum
punishment by way of imprisonment for the offence committed under Money
Laundering Act is -
A.
7 years B.9 years C.10
years D. 12 years
81. Dormant /
In-operative account means -
A.
No debits / credits in account for certain period
B.
A dead account not operated for over 10 years
C. No debit entries, but certain credit
entries for certain period
D. A fixed asset account
82.The objective
of verifying the employee life-styles by the employer is -
A.
to know the source of income
B. to ascertain whether the employee is having any contacts with
illegal organisations
C. to ascertain whether the employee is assisting
organisations banned by statutory authorities D.
All of these
83. Maximum
retention period of the bank records in case of suspicious transactions is -
A.
5 years B. 7 years C.
10 years D. 15 years
84. Role of the
concurrent auditors / Internal auditors with KYC is to -
A.
Review of compliance of KYC guidelines
B. Effectiveness of the implementation of the KYC
C. Verification of newly opened accounts and their transactions D. All of the above
85. Strict
adherence to KYC norms is achieved through -
A.
following the statutory authority guidelines
B.
identification of customers with appropriate documents
C.
strict Implementation of the Banks Systems and procedures while opening the
accounts
D. All of the above
86. For
effective implementation of “Know Your Employee”, measures to be adopted by the
banks are -
A. Verification of the life-styles of the
employees
B. Proper Job-rotation in work environment
C.
Not allowing frequent cheque purchase to the employees by the employer
D.
All of the above
87. Indicator/s
about the suspicious transactions of a customer accounts is/are -
A.
Depositing high value third party cheques endorsed in favour the account holder
B.
Sudden increase in cash deposits
C.
Receipt or payment of large sums of cash, which have no obvious purpose
D. All of the above
88. Which of the
following objective/s is/are important under new KYC Norms?
A.
To curb Money Laundering B. To curb the
specious activities
C.
To monitor/check the transactions of the bank customers
D. All of the above
89.The main
objective of KYC is to -
A. Prevent Money Laundering activities B. Improve Customer Service
C.
Improve Customer Documentation Standards D. None of these
90. Is adopting Anti Money Laundering
practices compulsory for Banks in India?
A.
Yes B. No C. Not Sure D. Will be made compulsory soon
91. Letter of
thanks is sent to introducer/s because it is -
A.
laid down in the banks’ manual B.
a routine practice followed by banks for years
C.
recommended by the Auditors of banks
D. assisting banks in
verification of genuineness or otherwise of the address
92. Money
Laundering measures were originally introduced by?
A.
DICGC B. EXIM Bank C.
FDIC D. SEBI
93.FATF is
located at -
A.
Mumbai B. New York C.
Paris D. Japan
94. One of the
important steps to be taken while opening NRI accounts is ……… by the bank
branch
A. Authentication / verification of
signature by Indian Embassy
B.
Authentication / verification of signature made by the relative of NRI in India
C.
Authentication / verification of signature made by friends of the NRI who are
staying abroad D.
All of the above
95. In case of
societies, the important document to be verified is -
A. Copy of Bye-Laws B. Certificate given by the ROC
C. Certificate given by the Local Authorities
D. No document is to be verified in case of societies, as it is
exempted
96.For opening
accounts in the case of Joint Hindu Undivided Family (JHUF), the following
document/s is/are important -
A.
Declaration of all family members B. Declaration of the Karta of the family
C.
Declaration of all guardians on behalf of minors
D. Declaration can be exempted as per Hindu Succession Act
97. In
computerised branches, suitable filters are required in the software for the
purpose of -
A.
calculating the correct rate of interest B.
printing out the customer profiles
C. monitoring the suspicious transactions
D. sharing information/data to the Head Office
98. The
objective of verifying the employee life-styles by the employer is -
A.
to know the source of income
B.
to ascertain whether the employee is having any contacts with illegal
organisations
C.
to ascertain whether the employee is assisting organisations banned by
statutory authorities
D. All of these
99. Strict
adherence to KYC norms is achieved through -
A.
following the statutory authority guidelines
B.
identification of customers with appropriate documents
C.
strict Implementation of the Banks Systems and procedures while opening the
accounts
D. All of the above
100. Role of the
front line employees of a bank in respect of KYC guidelines is to -
A. Identify customers as per the
existing instructions
B.
Serve with Smile while opening the customer accounts
C.
Assist the customer in filling-up the account opening forms
D.
Provide efficient customer service
101. While
accounts are transferred from one branch to another, the receiving branch is
expected to comply with KYC Norms. Which one of the following is/are correct in
this regard?
A.
Detailed verification of Customer Profile as received from the earlier branch
is to be done with caution
B.
Detailed verification is not needed but the account is opened immediately and
informed to the customer
C. Fresh details are to be obtained and a
fresh customer profile is to be prepared
D.
No transaction is to be permitted for the first six months till the customer is
fully know to the bank
102. Unusual
activities in respect of an customers account is/are -
A.
Opening of account at a place other than the place of work
B.
Frequent deposits of large sums of money bearing labels of other banks into the
account
C. Request for closure of
newly opened accounts where high value transactions are routed through
D. All of the above
103. For
effective implementation of “Know Your Employee”, measures to be adopted by the
banks are -
A. Verification of the life-styles of the
employees B. Proper Job-rotation in work environment
C.
Not allowing frequent cheque purchase to the employees by the employer
D.
All of the above
104. Objective
of KYC guidelines issued by RBI is -
A. To control the financial
frauds/money laundering
B.
To discourage opening of new accounts
C.
To increase competition among the public sector and private sector banks
D.
To check / control over the new accounts
105. Which of
the following is a source of identification of new customer who is not having
any valid documents such as, passport, etC.
A. Introduction from the third
person having an account with the bank /branch
B.
Introduction given the Safe deposit locker holder of the bank
C.
Self–declaration given by the new customer along with other opening forms
D.
None of the above
106. Which of
the following is the cardinal rule for bankers in anti-money laundering efforts
-
A. Know Your Customer & Know Your
Employee B. Know the Customer of the other Banks
C.
Know the income of the Customers of your Bank
D.
Know the Assets Position of the customers of the Bank
107. Money
Laundering means -
A.
Conversion of assets to invest in Laundromats
B. Conversion of money which is
illegally obtained to make them legitimate
C.
Conversion of cash into gold to make them legitimate
D.
Conversion of assets into cash to make them legitimate
108. Due
diligence is done at the time of opening an account to enable banks to ensure -
A.
identification of the customer at the time of opening an account
B.
correctness of the various denominations of notes given by the customer while
opening an account
C. authenticity of the signatures of the customer at the time of
opening an account
D.
speeding up the process of account opening of the new customers
109. The term
“Hawala” is an ----- word
A.
Telugu B. English C.
Arabic D. Islamic
110. Money
Laundering measures were originally introduced by?
A.
DICGC B. EXIM Bank C. FDIC D. SEBI
111. One of the
important steps to be taken while opening NRI accounts is ……… by the bank
branch
A. Authentication / verification of
signature by Indian Embassy
B.
Authentication / verification of signature made by the relative of NRI in India
C.
Authentication / verification of signature made by friends of the NRI who are
staying abroad
D. All of the above
112. For opening
accounts in the case of Joint Hindu Undivided Family (JHUF), the following
document/s is/are important -
A.
Declaration of all family members B. Declaration of the Karta of the family
C.
Declaration of all guardians on behalf of minors
D. Declaration can be exempted as
per Hindu Succession Act
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