Q.1    State True or False in the answer column. Give brief reason for your selection at the space
          provided below the question:                                                                                            (05)
                                                                                                                                                 (Answer)

i	FATF is an organ of United Nations Organization
ii	A banker while complying with law and State Bank of Pakistan circulars on reporting has to forgo its duty of ‘fidelity and secrecy’.
iii	Pakistan, Iran and Afghanistan are part of Golden Triangle.
iv	‘Hundi’ and ‘Finchin’ operate by relying upon ‘chits’.
v	NCCTS refers to list of countries that comply with FATF’s recommendations.

Q.2    Fill in the blanks:                                                                                                               (05)

                                                                                                                                                   (Answer)

i	Financial Action Task Force was established in __________________________
ii	In Pakistan reporting suspicious transaction is subjected to (identify both the circulars of State Bank of Pakistan and National Statutes) __________________
iii	The most important objective of the launderer in money laundering are _______
iv	The country with the biggest volume of washing dirty money is _____________
v	Money Laundering in Pakistani legislation is defined only once and that is in the Statue titled as _________________

Q.3    Please identify, define (if applicable) and discuss briefly the following:                       (20)

          A) APGML                   B) Compliance Officer                 C) Golden Crescent
          D) Grand Corruption     E) Basel Committee

Q.4 What factors are responsible for erosion of bankers’ “duty of confidentiality” with respect to their customer? Please discuss such factors in the light of global initiatives, Pakistani legislation and role of national agencies like NAB, CBR, FIA and others. Where, in your opinion, a balance may be established between the duty to customer and duty to State? (10)

Q.5 Financial Action Task Force has erred in focusing more upon terrorism Financing at the cost of Money Laundering. Please discuss in the light of 40+8 recommendations of FATF. (10)

Q.6 In money laundering what may be identified as customer related risks? Please discuss with at least three ‘samples of suspicious transactions’ as quoted in the circulars of State Bank of Pakistan? (10)

Q.7 KYC amounts to ‘Killing Your Customer’. Do you agree or disagree? Please support your answers with the Anti Money Laundering policy of State Bank of Pakistan. (10)

Q.8 What is correspondent banking and correspondent Bank account? What measures
       are recommended to discourage the launderers use such accounts.
      A) In United States by Senate sub committee known as Levin Committee (05)
     B) In Pakistan by the State Bank of Pakistan. (05)

Q.9 What are the risks associated with an unchecked growth of export trade and how over invoicing may contribute in disturbing the monetary policy of State Bank of Pakistan? Please recommend the measures to check over invoiced export trade. (10)

Q.10 What is internal control in a financial institution? Please discuss recommendation 19 of FATF. In Pakistan how you may improve upon this recommendation? (10)