Q11. The International Financial Services Centres Authority (IFSCA) in India has recently introduced regulations for:
a) Book-keeping, Accounting, Taxation and Financial Crime Compliance Services
b) Anti-Money Laundering and Countering the Financing of Terrorism
c) Beneficial Ownership Reporting
d) All of the above
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Correct Answer: a) Book-keeping, Accounting, Taxation and Financial Crime Compliance Services
Explanation: The IFSCA has recently introduced the IFSCA (Book-keeping, Accounting, Taxation and Financial Crime Compliance Services) Regulations, 2024.
Q12. Which of the following is NOT a type of financial crime?
a) Money Laundering
b) Terrorist Financing
c) Fraud
d) Robbery
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Correct Answer: d) Robbery
Explanation: Robbery is a violent crime and not a financial crime. Financial crimes are non-violent crimes committed for financial gain, such as money laundering, terrorist financing, and fraud.
Q13. Which of the following is an example of money laundering?
a) Disguising the proceeds of illegal activities as legitimate funds
b) Providing funds to individuals or groups to finance terrorist attacks
c) Intentionally deceiving someone for personal or financial gain
d) Hacking into computer systems to steal personal information
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Correct Answer: a) Disguising the proceeds of illegal activities as legitimate funds
Explanation: Money laundering involves disguising the proceeds of illegal activities such as bribery or fraud as legitimate funds.
Q14. Which of the following is an example of terrorist financing?
a) Disguising the proceeds of illegal activities as legitimate funds
b) Providing funds to individuals or groups to finance terrorist attacks
c) Intentionally deceiving someone for personal or financial gain
d) Hacking into computer systems to steal personal information
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Correct Answer: b) Providing funds to individuals or groups to finance terrorist attacks
Explanation: Terrorist financing involves providing funds or financial support to individuals or groups who carry out terrorist activities, including purchasing weapons or funding terrorist attacks.
Q15. Which of the following is an example of fraud?
a) Disguising the proceeds of illegal activities as legitimate funds
b) Providing funds to individuals or groups to finance terrorist attacks
c) Intentionally deceiving someone for personal or financial gain
d) Hacking into computer systems to steal personal information
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Correct Answer: c) Intentionally deceiving someone for personal or financial gain
Explanation: Fraud is a type of financial crime that involves intentionally deceiving someone for personal or financial gain, such as identity theft, investment scams, or insurance fraud.
Q16. Which of the following is an example of cybercrime?
a) Disguising the proceeds of illegal activities as legitimate funds
b) Providing funds to individuals or groups to finance terrorist attacks
c) Intentionally deceiving someone for personal or financial gain
d) Hacking into computer systems to steal personal information
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Correct Answer: d) Hacking into computer systems to steal personal information
Explanation: Cybercrime, also known as electronic crime, is a type of financial crime that involves the use of computers or the internet to commit fraudulent activities, such as hacking into computer systems to steal personal information, credit card fraud, or phishing scams.
Q17. Which of the following is NOT a consequence of money laundering and financial crime?
a) Unfairly disadvantages legitimate private businesses
b) Warps industry supply and demand
c) Threatens the stability of financial institutions
d) Increases government revenue
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Correct Answer: d) Increases government revenue
Explanation: Money laundering and financial crime can interfere with government revenue by allowing criminals to avoid paying taxes on their illegal proceeds, resulting in less money for the government to spend on important projects.
Q18. Which of the following is a measure that financial institutions can take to combat financial crime?
a) Implement Know Your Customer (KYC) and customer due diligence measures
b) Maintain suitable records of high-risk clients
c) Regularly monitor accounts for suspicious financial activity and report it to authorities
d) All of the above
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Correct Answer: d) All of the above
Explanation: Financial institutions can combat financial crime by implementing KYC and customer due diligence measures, maintaining suitable records of high-risk clients, and regularly monitoring accounts for suspicious financial activity and reporting it to authorities.
Q19. Which of the following is NOT a requirement of the Financial Action Task Force (FATF) recommendations?
a) Conduct customer due diligence measures
b) Maintain customer records for a minimum period of five years
c) Implement controls to identify Politically Exposed Persons (PEPs)
d) Disclose beneficial ownership information to the government
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Correct Answer: d) Disclose beneficial ownership information to the government
Explanation: The FATF recommendations do not require financial institutions to disclose beneficial ownership information to the government. This requirement was introduced by the Corporate Transparency Act in the United States.
Q20. Which of the following is a key feature of the 6th Anti-Money Laundering Directive (6AMLD)?
a) Broader definition of money laundering
b) Stricter penalties for non-compliance
c) Mandatory central registers for beneficial ownership
d) All of the above
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Correct Answer: d) All of the above
Explanation: Key features of the 6AMLD include a broader definition of money laundering, stricter penalties for non-compliance, and mandatory central registers for beneficial ownership.