Anti Money Laundering Measures and Business Ethics - Associateship
ISQ Examination (Summer-2007)


Q.1 Please identify, define (if applicable) and discuss briefly (at least 40 words each):
a
 Financial Action Task Force (04)
b
 Finance Intelligence Unit (04)
c
 Private Corruption (04)
d
 Free Zones (04)
e
 Special Recommendations (year 2001) of FAFT (04)

Q.2
Please define and differentiate between ‘fidelity’ and ‘secrecy’ as well as the nature of obligation they respectively bring about. How section 33 A of Banking Companies Ordinance 1962 be amended to strengthen the bankers? (10)

Q.3
Please discuss terrorism financing and also indicate the motives and morality of fund providers. What improvements you will recommend in the measures to keep the terrorists out and away from the banking networks. (10)

Q.4
Placement, layering and integration are necessary to wash dirty money through the banking system. Please explain each one of the processes with special emphasis on integration. (10)

Q.5
Please identify at least ten (10) alerting signals for a bankers that the present or potential customer may be a money launder? (10)

Q.6
A Terrorist is almost always money launderer but a launderer is rarely a terrorist? Please support your views (for or against) with plausible reasons. (10)

Q.7
The growth of export proceeds in Pakistan is partly related to inward remittances of dirty money remitted earlier from Pakistan. Please explain the phenomenon and (assuming it is correct) how it will affect the industry in Pakistan? (10)

Q.8
What is a tax haven? Please identify five of them and explain how tax havens have assisted the crime syndicates and corrupt officials in whitening their criminal proceeds? (10)

Q.9
Given below is an extract from State Bank of Pakistan Prudential Regulations – Anti Money Laundering Measures.
 

“Banks/DFIs are required to include accurate and meaningful originator information (name, address and account number) on funds transfers including wire transfers and related messages that are sent, and the information should remain with the transfer or related message throughout the payment chain. However, banks/DFIs may, if satisfied, substitute the requirement of mentioning address with CNIC, Passport, Driving license or similar identification number for this purpose.

“If the bank/DFI suspects, or has reasonable grounds to suspect, that the funds are the proceeds of a criminal activity or terrorist financing, it should report promptly, its suspicions through Compliance Officer of the bank / DFI to Banking Policy Department of the State Bank of Pakistan. The report should contain, at a minimum, the following information:

a)     Title, type and number of the accounts.
b)     Amounts involved.
c)     Detail of the transactions.
d)    Reasons for suspicion.

Develop a note describing implementation plan for your managerial cadre. (10)