AML-KYC-Sample Questions by Murugan

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SAMPLE QUESTIONS FOR oc
CERTIFICATE EXAMINATION IN
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ANTI-MONEY LAUNDERING &
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KNOW YOUR CUSTOMER

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Though we had taken enough care to go through the questions, we shall not be responsible for
any loss or damage, resulting from any action taken on the basis of the contents. We advise
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everyone to update yourself with the latest information through RBI website and other
authenticated sources. In case you find any incorrect/doubtful information, kindly update us
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also (along with the source link/reference for the correct information) as lot of questions were
shared by many people.
January 2019 K Murugan, MCA MBA CAIIB

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ANTI-MONEY LAUNDERING & KNOW YOUR CUSTOMER - GENERAL INFORMATION
PASSING CRITERIA:
Minimum marks for pass in the subject is 60 out of 100.
EXAMINATION FEES* :
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For Members
First attempt - Rs.1,000/- *
Subsequent each attempt - Rs.1,000/- *
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For Non-Members
First attempt - Rs.1,500/- *
Subsequent each attempt - Rs.1,500/- *
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* Plus convenience charges and Taxes as applicable
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Please Note : Candidates are required to Register for every attempt separately.
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As a measure to streamline the traffic for registration, Institute will charge regular examination
fee to candidates who registers for the examination during the regular open period of
registration. For the extended days of registration, late fee of Rs.200 plus taxes, will be charged
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in addition to regular examination fee. This extended days of registration, also gives candidates
addition opportunity to register for the examination, having missed the regular open period of
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registration.
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The fee once paid will NOT be refunded or adjusted on any account.
MEDIUM OF EXAMINATION :
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Examination will be conducted in English only.

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PATTERN OF EXAMINATION:
(i) Question Paper will contain 120 objective type multiple choice questions for 100 marks.
(ii) The examination will be held in Online Mode only
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(iii) There will NOT be negative marking for wrong answers.

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DURATION OF EXAMINATION:
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The duration of the examination will be of 2 hours.
PERIODICITY AND EXAMINATION CENTRES:

a) Examination will be conducted on pre-announced dates published on IIBF Web Site. Institute
conducts examination on half yearly basis, however periodicity of the examination may be
changed depending upon the requirement of banking industry.
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b) List of Examination centers will be available on the website. (Institute will conduct
examination in those centers where there are 20 or more candidates.)
STUDY MATERIAL / COURSEWARE

The Institute has developed a courseware to cover the syllabus. The courseware (book) for the
subject/s will be available at outlets of publisher/s. Please visit IIBF website www.iibf.org.in
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under the menu “Exam Related” for details of book/s and address of publisher/s outlets.
Candidates are advised to make full use of the courseware. However, as banking and finance
fields are dynamic, rules and regulations witness rapid changes. Therefore, the courseware
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should not be considered as the only source of information while preparing for the
examinations. Candidates are advised to go through the updates put on the IIBF website from
time to time and go through Master Circulars / Master Directions issued by RBI and publications
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of IIBF like IIBF Vision, Bank Quest, etc. All these sources are important from the examination
point of view. Candidates are also to visit the websites of organizations like RBI, SEBI, BIS, IRDAI,
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FEDAI etc. besides going through other books & publications covering the subject / exam
concerned etc. Questions based on current developments relating to the subject / exam may
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also be asked.
Cut-off Date of Guidelines / Important Developments for Examinations

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The Institute has a practice of asking questions in each exam about the recent developments /
guidelines issued by the regulator(s) in order to test if the candidates keep themselves abreast
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of the current developments. However, there could be changes in the developments /

guidelines from the date the question papers are prepared and the dates of the actual
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examinations.
In order to address these issues effectively, it has been decided that:

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(i) In respect of the examinations to be conducted by the Institute for the period February to
July of a calendar year, instructions / guidelines issued by the regulator(s) and important
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developments in banking and finance up to 31st December will only be considered for the
purpose of inclusion in the question papers".
(ii) In respect of the examinations to be conducted by the Institute for the period August to
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January of a calendar year, instructions / guidelines issued by the regulator(s) and important
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developments in banking and finance up to 30th June will only be considered for the purpose of
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SYLLABUS
The details of the prescribed syllabus which is indicative are furnished below. However, keeping
in view the professional nature of examinations, all matters falling within the realm of the
subject concerned will have to be studied by the candidate as questions can be asked on all
relevant matters under the subject. Candidates should particularly prepare themselves for
answering questions that may be asked on the latest developments taking place under the
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various subject/s although those topics may not have been specifically included in the syllabus.
Any alterations made will be notified from time to time. Further, questions based on current
developments in banking and finance may be asked.
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Candidates are advised to refer to financial news papers / periodicals more particularly “IIBF
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VISION” and “BANK QUEST” published by IIBF.
Certificate Examination in Anti-Money Laundering & Know Your Customer
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(i) Anti Money Laundering oc
Money Laundering - Origin - Definition - Techniques Impact on Banks - Structuring; Integration,
Preventive Legislations - International Co-operation - UK; USA; India - Basel Committee - PMLA
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Objectives - RBI Guidelines - System Adequacy to Combat Money Laundering - Antiterrorism
finance - Financial Intelligence Unit (FIU)
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The Financial Action Task Force (FATF) - IBA Working Group - Software for AML Screening :
Money Laundering and Correspondent Banking - Exchange Companies - Foreign Branches
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(ii) Know Your Customer - Introduction and overview

Customer Profile - KYC Policies - Countries Deficient in KYC Policies, Initiatives by the RBI -
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Organised Financial Crimes Customer - Definition under the KYC Principles - Transaction Profile -
Organisational Structure - Important KYC framework in RBI prescriptions - Operating Guidelines.
Introduction of new accounts - Guidelines for Opening Accounts of Companies, Trusts, Firms,
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Intermediaries etc., Client Accounts opened by Professional Intermediaries - Trust / Nominee or

Fiduciary Accounts - Accounts of Politically Exposed Persons (PEPs) Residing Outside India,
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Accounts of ‘non-face-to-face’ Customers - Qualitative data - Joint accounts - Minor accounts -

KYC for existing accounts - KYC for low income group customers.
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Monitoring Accounts - Customer research - Suspicious transactions

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Anti-Money Laundering & Know Your Customer
Which of the following Bank Employee styles arousing suspicion? (i) Lavish Life style cannot be
supported by his/her salary, (ii) Avoidance of long leave/vacation, (iii) Repeated negligence in
observance of rules
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a. Only (i) and (ii)
b. Only (i) and (iii)
c. Only (ii) and (iii)
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d. (i), (ii) and (iii)
Ans - d
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An important element to the success of the AML process is that the customers should not be informed
that his/her accounts are under monitoring for suspicious activities and/or that a disclosure has been
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made to the designated authority, namely FIU-IND. This is called as ......
a. Tipping off
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b. Topping off
c. Tapping off
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d. All the above
Ans - a
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Which of the followings is true regarding Suspicious transactions as per PMLA- as a transaction whether
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or not made in cash which to a person acting in good faith ...... (i) Give rise to a reasonable ground of
suspicion that it may involve the proceeds of crime, (ii) Appears to be made in circumstances of unusual
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or unjustified complexity, (iii) Appears to have no economic rationale or bona fide purpose

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Ans - d
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High net worth individual is one whose net worth is Rs. ......
a. Rs. 5 crores and above

b. Rs. 1 crore and above
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c. Rs. 50 lacs and above

d. Rs. 10 crores and above
Ans - a
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Non-Profit organizations (NPOs)/ Non-Governmental Organizations (NGOs) promoted by the United
Nations (UN) or its agencies will be classified as ......
a. Low Risk customers
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b. Medium Risk customers
c. High Risk customers
d. Exempted from Risk Classification
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Ans - a
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Branch should not open deposit/advances account of the following organizations ......
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a. Banned/terrorist organizations circulated by the local authorities
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b. Banned/terrorist organizations circulated by the Chamber of Commerce
c. Banned/terrorist organizations circulated by the Registrar of Companies
d. Banned/terrorist organizations circulated by the statutory authority
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Ans - d
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Minimum punishment prescribed for the offence of Money laundering Act is ......
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a. 7 years
b. 9 years
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c. 10 years
d. 12 years
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Ans - a
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Which of the following acts defines the offence of Money Laundering as under – “Engaging directly or
indirectly in a transaction that involves property, that is proceeds of crime (or) derived from proceeds of
crime (or) knowingly receiving, possessing, concealing, disguising, transpiring, converting, disposing off
within the territories of India, removing form or bringing into the territory of India the property that is
proceeds of crime”?
a. Anti-Money Laundering Act, 2005

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b. Active Money Laundering Act (AMLA), 2003

c. Prevention of Money Laundering Act (PMLA), 2002
d. Impediment of Money Laundering Act (PMLA), 2002
Ans - c
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In the process of customer identification, the customer identification data should be updated ...... in 5
years in case of low risk category, and __________ in case of medium and high risk category customers.
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a. Twice; 1 year
b. Once; 1 years
c. Twice; 2 years
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d. Once; 2 years
Ans - d
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...... is the process of keeping the amount lower than that fixed for reporting and building similar
transactions till the amount planned to be laundered is reached fully.
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a. Entrailing
b. Lading
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c. Slushing
d. Smurfing
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Ans - d
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What information about the correspondent bank must be available? (i) Major business activities, (ii) The
bank's management, (iii) Level of AML/KYC compliance
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Ans - d
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Which of the following is a high risk activity?
a. A customer purchasing a car from a local garage

b. Printing a statement for a customer
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c. A loan for home improvement

d. Money transfer to unknown third parties
Ans - d
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As per KYC guidelines, the banks cannot have correspondent arrangements with 'Shell Banks'. For this
purpose, the 'Shell Bank' mean ......
a. a bank having no existence but on paper only
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b. a bank incorporated outside India and having a branch in India
c. a bank incorporated in a country where it has no existence and it is not regulated by a regulating
authority
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d. a bank incorporated outside India and banned by UNTO to have operations other than in country of
incorporation
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Ans - c
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As per Prevention of Money Laundering Act, the banks are required to maintain record of transactions
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for a period offrom date of cessation of the transaction ......
a. 2 years
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b. 5 years
c. 10 years
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d. 20 years
Ans - b
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As per KYC policy, the banks should not allow opening and/or holding of an account on behalf of a
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client/s by professional intermediaries, like Lawyers and Chartered Accountants, etc.,

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a. who refuse to disclose true identity of the owner of the account/funds due to any professional
obligation of customer confidentiality.
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b. who do not disclose true identity of the owner of the account/funds due to any professional
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c. who are unable to disclose true identity of the owner of the account/funds due to any professional
d. all the above
Ans - c
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of below Rs.10 lac even, if the aggregate of such transactions is Rs. during days/weeks/ months ......
a. Rs.10 lac, one month

b. above Rs.10 lac, one month
c. above Rs.10 lac, a single day
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d. Rs.10 lac, a single day
Ans - b
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If a basic saving bank deposit account is opened as a small account as per KYC guidelines of RBI, which of
the following conditions, will not be applicable? (1) max balance can be Rs.50000, (2) max credit in a
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financial year can be Rs.1.00 lac, (3) per month withdrawal or transfer is restricted to Rs.10000
a. no such condition is applicable
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b. only 1 and 2
c. only 2 and 3
d. 1 to 3 all
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Ans - d
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Please read the KYC practice given below. Identify the KYC element which best relates to the stated
practice. Well-developed and applied customer assessments enable identification and classification of
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potentially high-risk customers. This is known as ......
a. customer acceptance
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b. customer identification
c. accounts and transaction monitoring
d. risk management
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Ans - a
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Who file a report onward to the FIU-IND, if the Bank concludes that a transaction is suspicious?
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a. PO
b. senior management
c. Internal Audit and Control team
d. None of the above
Ans - a
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Which of the crime is/are included under PMLA, 2002 for proceeds of crime? (i) Drug trafficking, (ii)
Kidnapping, (iii) Murder

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Ans - d
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Laundering might attempt a series of small currency transaction over time because ......
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a. a provision of the bank secrecy act requires the filing of CTR for a transaction exceeding Rs. 10 Lakhs
b. Larger amount are too risky to carry around
c. that's the way in which launderers take in the funds
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Ans - a
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What services are offered by correspondent banks? (i) International wire transfers, (ii) Cheque clearing,
(iii) Cash/fund transfers
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Ans - d
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Which of the following should be treated as a ‘customer’ for prudent KYC analysis? (i) any person or
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company which can conduct a transaction in relation to an account offered by a ban, (ii) any person who
is a signatory to an account offered by a building society, (iii) any person or company which holds an
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account issued by a credit union

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Ans - d
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...... is a bank which is incorporated in a country where is no physical presence and is not affiliated to any
regulated financial group.
a. Correspondent Bank
b. Shell Bank
c. Respondent Bank
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d. Compendium Bank
Ans - b
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Which element of an effective transaction monitoring process, involves scrutiny of the transactions
carried out by the customer over a longer period of time?
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a. Analysis of transactions
b. Identification of Exceptional transactions
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c. Enhanced Due Diligence
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Ans - a
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Customer verification is vital to any KYC procedure. What is acceptable in verifying an individual
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customer? Select the incorrect response from the alternatives below. In verifying an individual
customer, you can rely on .......
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a. a certified copy of a birth certificate in conjunction with the customer's drivers licence and Medicare
card
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b. sighting original identification such as birth certificate and drivers licence

c. a reference from a good friend
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Ans - c
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...... are fake companies that appear on paper, but may not physically exist.
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a. Shell Companies
b. Front Companies
c. Offshore Banking
d. Hawala Systems
Ans - a
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...... services are used to buy or sell foreign currencies, to consolidate small denomination bank notes
into larger ones, or to exchange financial instruments. Criminals are attracted to this method of
laundering as they are not as heavily regulated as traditional financial institutions.
a. Remittance
b. Bureaux De Change
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c. Back-to-Back Loans
d. Collection Accounts
Ans - b
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During customer acceptance and identification activities, on which of the following customers should
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enhanced due diligence be conducted? (i) trustees, nominees, and fiduciaries, (ii) non-face-to-face
customers, (iii) correspondent accounts
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Ans - d
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Which one of the following is a Valid document available to the bank for customer identification?
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a. Election ID card
b. Ration Card
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c. Bank statement of account

d. Photograph
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Ans - a
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Which of the following terms is used to describe the process of sending money through multiple
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financial institutions to make it difficult to track?

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a. Integration
b. Camouflage
c. Placement
d. Layering
Ans - d
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What should be recorded regarding records of employee training on AML/KYC? (i) date of training, (ii)
nature of the training received, (iii) attendance

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Ans - d
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Money derived from criminal activity is known as ......
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a. Proceeds Possession
b. Proceeds of Crime
c. Dirty Money
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d. Crime Laundering
Ans - b
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What factors and characteristics come into play for the process of customer profiling? (i) buying
patterns, (ii) creditworthiness, (iii) purchase history
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Ans - d
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Which of the following customers fall under the high risk category customers from KYC purposes ...... (a)
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politically exposed persons of foreign origin, (b) companies having close shareholding, (c) firms having
sleeping partners, (d) high net worth individuals.
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a. a to d all
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b. a to c only
c. b to d only
d. a, b and d only
Ans - a
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Which of the following customer does not fall under low risk category under KYC guidelines ......
a. salaried employees
b. persons from lower strata of the society
c. govt. departments
d. trusts
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Ans - d
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CTR stands for .......
a. Custom Trafficking Report
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b. Current Transaction Receipt
c. Currency Transaction Report
d. Criminal Trading Raid
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Ans - c
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Penalty to the banks for violating the Money Laundering Act is ......
a. Up to Rs. 15 lacs for violating every single norms

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b. Up to Rs. 25 lacs for violating every single norms

c. Up to Rs. 50 lacs for violating every single norms
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d. Up to Rs.100 lacs for violating every single norms
Ans - d
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Maximum retention period of the bank records that can be produced to the directorate of Anti Money
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laundering by the financial institutions in case of suspicious transactions is ......

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a. 5 years
b. 7 years
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c. 10 years
d. 15 years
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Ans - c
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Dormant/Inoperative account means ......
a. No debits/credits in account for a certain period

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b. Dead account without any operation for long

c. No debit entries, but certain credit entries(Interest ) for certain period
d. Fixed asset account of the bank
Ans - c
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Money laundering is the result of crime and the persons behind the crimes appear to be using banking
channels for the purpose of ...... (i) fund transmission, (ii) creating a legal front of money raised through
illegal and humanity demeaning methods.
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a. Only (i)
b. Only (ii)
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c. Either (i) or (ii)
d. Both (i) and (ii)
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Ans - d
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What should employees be aware about the handling of transactions which may involve money
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laundering? (i) potential effect on the bank, (ii) potential effect on bank's employees, (iii) potential effect
on bank's customers
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Ans - d
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Which of the following are required documents to establish both the identity and the correct address
while opening accounts of companies? (I) Certificate of incorporation and Memorandum of Articles of
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Association (II) Resolution of Board of Directors to open an account, and identification of those who
have the authority to operate the account (III) Power of Attorney granted to a partner or an employee of
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the firm to transact business on its behalf (IV) Copy of PAN allotment letter (V) Copy of telephone bill
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a. (I), (II), (III) and (IV) above

b. (I), (II), (IV) and (V) above
c. (II), (III), (IV) and (V) above
d. (I), (II), (III), (IV) and (V) above
Ans - d
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...... is the provision of banking services by one bank to another bank.
a. Respondent Banking
b. Crude Banking
c. Correspondent Banking
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Ans - c
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The three stages of money laundering are .......
a. Layering, Placement, Refining
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b. Placement, Refining, Integration
c. Refining. Integration, Layering
d. Integration, Layering, Placement
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Ans - d
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KYC guidelines have been issued by RBI under the provisions of ......
a. Section 35 of Banking Regulation Act

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b. Section 35-A of RBI Act

c. Section 35-A of Banking Regulation Act
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d. Section 35-A Prevention of Money Laundering Act
Ans - c
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In a basic saving bank deposit account which of the following 'service can be allowed ...... (1) deposit and
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withdrawal of cash at bank branch as well as ATMs, (2) receipt/credit of money through electronic
payment channels, (3) by means of deposit/collection of cheques drawn by Central/State Government
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agencies and departments

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a. 1 only
b. 1 and 2 only
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c. 1 to 3 all
d. 2 and 3 only
Ans - c
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What is the minimum balance that the banks can stipulate in a basic saving bank deposit account ......
a. no such condition can be imposed

b. Rs.10
c. Rs.100
d. Rs.200
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Ans - a
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As per KYC policy of RBI, which of the following instruments can be issued in cash if the amount is
Rs.50000 or above ......
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a. travellers' cheque, demand drafts
b. demand drafts, mail-transfers
c. mail transfers, telegraphic transfers
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d. none of the above
Ans - d
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PAN is required to be quoted, as per RBI's KYC guidelines if the amount of transaction in cash is ......
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a. above Rs.50000
b. Rs.50000 or above
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c. less than Rs.50000

d. Rs.10000 and above
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Ans - b
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For KYC policy, the customer has been defined to include ...... (a) a person or entity that maintains an
account and/or has a business relationship with the bank, (b) one on whose behalf the account is
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maintained (i.e. the beneficial owner), (c) beneficiaries of transactions conducted by professional
intermediaries, such as Stock Brokers, Chartered Accountants, Solicitors etc. as permitted under the law,
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(d) any person or entity connected with a financial transaction which can pose significant reputational or
other risks to the bank, say, a wire transfer or issue of a high value demand draft as a single transaction.
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a. a, b and c only
b. a, c and d only
c. b, c and d only
d. a to d all
Ans – d
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Under KYC guidelines, where a customer does not comply with the KYC requirement, his account can be
closed. (a) decision to close the account should be taken at a high level (b) account should closed after
giving due notice to the customer (c) account should be closed after explaining the reasons to the
customer
a. a to c all correct
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b. a and c only correct
c. a and b only correct
d. b and c only correct
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Ans - a
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While monitoring of customer transaction it should be ensured that there is no ...... i.e., manipulation of
the size of transaction so that if seen individually they fall below the threshold that needs to be reported
to the monitoring authority.
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a. Entrailing
b. Structuring
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c. Lading
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d. Slushing
Ans - b
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As a manager/Compliance officer, it is a part of your job to ....... (i) Maintain your companies AML
Program, (ii) Ensure that proper reports are filed and records are maintained, (iii) Ensure that all
employees report suspicious activities
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Ans - d
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Following are the indicators of suspicious transactions in a customer account ...... (i) Deposit of high
value third party cheques endorsed in favour of the account holder frequently, (ii) Sudden increase in
cash deposits without any valid reason, (iii) Receipt or payment of large sums of cash, which have no
obvious purpose

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Ans - d
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Role of front line employees in respect of KYC guidelines is ......
a. Identification of customers as per extant instructions

b. Service with smile while opening the customer accounts
t.c
c. Assist the customer in filling-up the account opening forms
d. Provide efficient, prompt and courteous forms
es
Ans - a
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kt
Banks are to keep a close watch on large size cash debit or credit transactions in deposit or loan
accounts and keep a record of such transactions. For this purpose, the large size transaction means,
where the amount is ......
oc
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a. Rs.10 lac and above
b. above Rs.10 lac
c. less than Rs.10 lac
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d. all the above

ca
Ans - b
.............................................
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KYC guidelines take into account the recommendations of an international Financial Action Task Force
...... (a) on anti-money laundering standards (b) on combating financing of terrorism (c) on manipulation
of economic offences
.ja
a. a and b only
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b. b and c only
c. a and c only
w
d. a to c all
w
Ans - a
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KYC policy of the banks, as per RBI directives should provide for (a) customer acceptance policy (b)
customer identification procedure (c) monitoring of transactions (d) risk management
a. a, b and c only
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b. a, c and d only
c. b, c and d only
d. a to d all
Ans - d
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Unusual activities in respect of a customer's accounts are ......
a. Opening of account at a place other than the place of work
t.c
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 already routed
through
es
d. All the above
Ans - d
kt
.............................................
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Which of the following document/s can be accepted by banks as a proof of Customer Identification ......
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a. Electricity Bill
b. Salary Slip
c. Income/Wealth tax assessment order
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d. Election Identity card

ca
Ans - d
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As per Prevention of Money Laundering Act the banks are required to submit to Financial Intelligence
Unit-India, monthly statement of large cash transactions called, CTR. It is to be submitted for
transactions of Rs. and within of close of the month ......
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a. Rs.10 lac, 7 days

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b. above Rs.10 lac, 7 days

c. above Rs.10 lac, 15 days
w
d. Rs.10 lac, 5 days

w
Ans - c
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Which of the following is the document for proof of customer identity and address under KYC ......
a. Telephone bill
b. Aadhaar number
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c. Electricity bill
d. All the above
Ans - b
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As per Prevention of Money Laundering Act, the banks are required to submit to Financial Intelligence
Unit-India, statement on suspicious transactions, called, STR. It is to be submitted for transactions of Rs.
and within of arriving at conclusion ......
t.c
b. above Rs.10 lac, 3 days
c. any amount, 7days
es
d. any amount, 15 days.
Ans - c
kt
.............................................
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Data on counterfeit notes detected by all the branches of the bank shall be reported in the prescribed
format, on a monthly basis. A statement showing the details of counterfeit notes detected in the bank
m
branches during the month shall be compiled and forwarded to the Issue Office of Reserve Bank
concerned so as to reach them by ...... of the next month
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a. 5th
b. 6th
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c. 7th
d. 8th
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Ans - c
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Under Rule 3 of Prevention of Money Laundering Rules, 2005, Principal Officers of banks are also
required to report information on cash transactions where forged notes have been used as genuine note
w
to The Director, FIU-IND, Financial Intelligence Unit- India, within ...... working days. A ‘nil’ report may be
sent in case no counterfeit has been detected during the month.
w
a. 5
w
b. 7
c. 10
d. 14
Ans - b
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The responsibility of ensuring the quality and genuineness of cash loaded at ...... would be that of the
Sponsor Bank
a. White Label ATM’s

b. Brown Label ATM’s
c. Both a & b
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d. None of these
Ans - a
.............................................
t.c
Which of the following is an important feature of small deposit accounts?
es
a. where the maximum balance shall not exceed Rs.50000
b. total of credit entries in the account would not exceed Rs.1 lac during an year
c. monthly withdrawal is not more than Rs.10000
kt
d. a to c all
Ans - d
oc
.............................................
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In a basic saving bank deposit account what is the maximum no. of deposit and cash withdrawal
(including ATM) transactions ......
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a. no ceiling
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b. 2
c. 4
d. 10
iib
Ans - c
.............................................
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...... is a matrix of different components (such as source of funds, level of income, volume and frequency
w
of transaction etc) that helps arrive at a benchmark transaction for individual customer transactions,
against which a comparison can be made.
w
a. KYC Profile
w
b. Customer Risk Profile

c. Transaction Profile
d. Interim Profile
Ans - c
.............................................
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In case of low risk customers, full KYC is required to be done by the bank ......
a. not less than 2 years

b. not less than 5 years
c. not less than 10 years
d. not required
om
Ans - c
.............................................
t.c
Which of the following group of customers, will be categorized as a low risk customer, as per provisions
of ......
es
a. Govt. Deptt., a joint stock company
b. partnership firm, a salaried employee
c. a salaried employee, govt. deptt.
kt
d. all the options are correct
Ans - c
oc
.............................................
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practice. High-risk customer activity is regularly reviewed and substantial high-risk customers are
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personally known to management. This is known as ......

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d. risk management
Ans - d
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.............................................
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In case, mutilated notes detected in soiled note remittances and currency chest balances, mutilated
notes of 100 pieces and above per remittance shall be debited immediately and penalty may be levied
w
on reaching a limit of ...... in a cumulative manner.

w
a. 50 pieces
b. 70 pieces
c. 100 pieces
d. 125 pieces
Ans - c
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In case of non-compliance with operational guidelines by currency chests is detected by RBI officials
such as Nonfunctioning of CCTV; Branch cash/documents kept in strong room; Non-utilization of NSMs
for sorting of notes the penalty of Rs. ...... shall be levied for each irregularity & same shall be enhanced
to Rs. ...... in case of repetition.
a. Rs. 2500; Rs. 5,000
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b. Rs. 5,000; Rs. 10,000
c. Rs. 10,000; Rs. 15,000
d. Rs. 10,000; Rs. 20,000
t.c
Ans - b
.............................................
es
AML/KYC guidelines are issued under ....... (i) BR Act,1949, (ii) PMLA,2002, (iii) RBI Act
kt
oc
m
Ans - a
.............................................
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Threshold limit is to be fixed for each account by the bank ......

ca
a. After 6 months from the date of opening account

b. After 12 months from the date of opening account
c. After 36 months from the date of opening account
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d. At the time of opening the account itself
Ans - d
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.............................................
w
How does KYC checks be communicated to customers of bank? (i) Incorporating the requirements in the
account opening forms, (ii) Publishing relevant information on the websites of the bank, (iii) Providing a
w
ready reckoner on frequently asked questions related to KYC

w

Ans - d
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Money Laundering refers to .......
a. Conversion of cash in to gold

b. Conversation of assets into cash
c. Conversion of assets into cash
d. Conversion of money which is illegally obtained
om
Ans - d
.............................................
t.c
The data on detection of counterfeit Indian notes at bank branches & treasuries should be included in
the ...... Returns forwarded to the Reserve Bank Issue Offices
es
a. Fortnightly
b. monthly
c. Bi-monthly
kt
d. Quarterly
Ans - b
oc
.............................................
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The banks should re-align their cash management in such a manner so as to ensure that cash receipts in
the denominations of ...... and above are not put into recirculation without the notes being machine
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processed for authenticity

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a. Rs. 20
b. Rs. 50
c. Rs. 100
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d. Rs. 500
Ans - c
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.............................................
w
Banks are to keep a close watch on large size cash debit or credit transactions in deposit or loan
accounts and keep a record of such transactions. For this purpose, the large size transaction means,
w
where the amount is ......

w
a. Rs.10 lacs and above

b. Above Rs. 10 lacs
c. Less than Rs. 10 lacs
d. All the above
Ans - b
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As per RBI guidelines, penalty at ...... of the notional value of counterfeit notes, in addition to the
recovery of loss to the extent of the notional value of such notes, will be imposed when counterfeit
notes are detected in the soiled note remittance of the bank and in the currency chest balance of a bank
during Inspection / Audit by RBI
a. 50percent
om
b. 60percent
c. 80percent
d. 100percent
t.c
Ans - d
.............................................
es
Placement under money laundering means ...... (i) Smuggling bulk cash, (ii) Mix illicit proceeds with
legitimate deposits, (iii) Deposit amounts in small denominations
kt
oc
m
Ans - d
.............................................
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Any lapses in adhering to the guidelines of KYC is under the purview of --------- and liable for penalty
ca
a. Consumer Protection Act

b. Banking Ombudsman
iib
c. FERA Act
d. Competition Act
.ja
Ans - b
.............................................
w
Layering under money laundering refer to ......

w
a. Disguising the origin of initial deposit through multiple transfers

w
b. Disguising the origin of initial deposit through Multiple Transactions

c. Both A & B
Ans - c
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As per RBI guidelines, appeal against the decision of the competent authority can be made with regards
to imposition of penalty for non-compliance with operational guidelines by the Controlling Office of the
currency chest/branch to the Regional Director of the Regional Office concerned, within ...... from the
date of debit, who may decide whether the same can be accepted/ rejected
a. 2 months
om
b. 1 month
c. 15 days
d. 1 week
t.c
Ans - b
.............................................
es
At what point is the PEP (Politically Exposed Persons) check done?
a. At the first point of customer interaction
kt
b. At the account services level
c. At the central account services level
d. One-month after the account is opened
oc
m
Ans - a
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iib
In case the name of any banned organization appears as payee/endorsee/applicant, the concern official
should inform this to ......
ca
a. The presenter of this instrument

b. The drawer of the cheque by the immediate supervisor/controller
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c. Returning the cheque with the objection with "refer to drawer‟

d. The RBI
.ja
Ans - b
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w
KYC guidelines have been issued by RBI under the provisions of ......
w
a. Section 35 of Banking Regulation Act

w
b. Section 35 –A of RBI act

c. Section 35-A of Banking Regulation act
d. Section 35-A prevention of Money Laundering Act
Ans - c
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KYC guidelines of RBI protect banks from being used for ...... (i) money laundering purpose by criminals,
(ii) Financing terrorism, (iii) for financing black marketing activities

om
Ans - a
.............................................
t.c
KYC guidelines take into account the recommendations of an international Financial Action Task Force
...... (i) On anti money laundering standards, (ii) on combating financing terrorism, (iii) on manipulation
es
of economic offences
kt
oc
m
Ans - a
.............................................
iib
KYC policy of our bank, as per RBI directives contains elements of ...... (i) Customer Acceptance Policy, (ii)
Customer identification Procedure, (iii) Monitoring of transactions
ca

iib

.ja
Ans - d
.............................................
w
For business enterprises the threshold limit is to be fixed based on the following formulae ......
w
a. One month turnover subject to a maximum of Rs.10 lacs

w
b. Based on the working capital requirements of the firm

c. Based on the finance made by the bank
Ans - a
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Cash Monitoring Register is ......
a. To note down the receipts and payments of the branch

b. To note down the high value transactions of the customers
c. For internal and external audit purposes
d. For verification by the controllers of the branch
om
Ans - b
.............................................
t.c
Monitoring suspicious transactions is the responsibility of ......
a. Officer-in-charge of the respective accounts
es
b. Branch Manager
c. Controlling Authority
d. Customer
kt
Ans - a
.............................................
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m
In computerized branches of commercial banks, the balances of the customers are to be
checked/verified with the following ......
iib
a. Limits of the customer

b. Drawing power of the customer
ca
c. Threshold limits of the customer

d. Balances lying in the customer's other accounts
iib
Ans - c
.............................................
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One of the recommendations of the IBA committee on Money laundering is ......

w
a. Appointment of MLRO ( Money laundering Reporting Officers)

b. Appointment of outside agency to monitor the suspicious transactions of the bank
w
c. Appointment of law officer to monitor the suspicious accounts

w
Ans - a
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One of the objective of KYC guidelines is ......
a. To get protection under SEBI Act

…………………………………………………………………………………………………………………………………………………………………
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b. To get protection under Consumer protection act

c. To get protection under section 87 of NI act
d. To get protection under section 131 of NI act
Ans - d
.............................................
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Introduction of a customer for opening a current account can be obtained from the following ......
a. From satisfactorily conducted savings account holder
t.c
b. From well known authorities
c. From staff member to whom customer is well known
d. Introduction not required
es
Ans - d
.............................................
kt
While opening an account of a company, the following is must ......
oc
a. Introduction by a customer known to the banker
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b. Certificate of incorporation/certificate of commencement of business
c. Introduction by ROC
iib
Ans - b
ca
.............................................
Every Officer-in-charge of the branch i.e. the Branch Manager and every Officer-in-charge of the
iib
Accounts or Cash Wing of the Branch shall act as ...... in each branch to adjudicate the notes received at
the branch for exchange in accordance with Reserve Bank of India (Note Refund. Rules, 2009
.ja
a. Prescribed Officer
b. Exchange Officer
w
c. Settlement Officer
d. Cash In charge
w
Ans - a
w
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Which of the following points are true with respect to record keeping instructions for Mutilated Notes?
a. After adjudicating mutilated notes, the Prescribed Officer is required to record his order by
subscribing his initials to the dated 'PAY'/ 'PAID'/ 'REJECT' stamp
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b. Mutilated / defective notes bearing 'PAY'/'PAID' (or 'REJECT') stamp of any RBI Issue Office or any
bank branch, if presented for payment again at any of the bank branches should be rejected under Rule
6(2) of Reserve Bank of India (Note Refund. Rules, 2009
c. All bank branches have instructions not to issue notes bearing PAY/PAID stamps to the public even
through oversight
d. All of these
om
Ans - d
.............................................
t.c
Any note with slogans and message of a political nature written across it ceases to be a legal tender and
the claim on such a note will be rejected under ...... of Reserve Bank of India (Note Refund. Rules, 2009
es
a. Rule 6(3) (i)
b. Rule 6(3) (ii)
c. Rule 6(3) (iii)
kt
d. Rule 6(3) (iv)
Ans - c
oc
.............................................
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The notes, which are found to be deliberately cut, torn, altered or tampered with, if presented for
payment of exchange value should be rejected ...... of the Reserve Bank of India (Note Refund. Rules,
iib
2009:
ca
a. Under Rule 6(3)(i)

b. Under Rule 6(3)(ii)
c. Under Rule 6(3)(iii)
iib
d. Under Rule 6(3)(iv)
Ans - b
.ja
.............................................
w
With regards to disposal of notes adjudicated at bank branches, the full value paid notes have to be
remitted by all branches to the ...... with which they have been linked and there from to the Issue Offices
w
concerned together with the next soiled note remittance in the manner already laid down
w
a. Chest Branches
b. Circle Office
c. Head Office
d. Zonal Office
Ans - a
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With regards to licensing norms of Universal Banks in the Private Sector, the bank shall get its shares
listed on the stock exchanges within ...... years of the commencement of business by the bank
a. 2 yrs
b. 3 yrs
c. 5 yrs
om
d. 6 yrs
Ans - d
.............................................
t.c
As per RBI guidelines relating to licensing norms of Universal Banks in the Private Sector, the bank shall
open at least ...... of its branches in unbanked rural centres (population up to 9,999 as per the latest
es
census)
a. 10 percent
kt
b. 20 percent
c. 25 percent
d. 30 percent
oc
m
Ans - c
.............................................
iib
As per RBI guidelines relating to licensing norms of Universal Banks in the Private Sector, the validity of
the in-principle approval issued by the RBI will be ...... from the date of granting in-principle approval
ca
and would thereafter lapse automatically
a. 6 months
iib
b. 12 months
c. 18 months
d. 24 months
.ja
Ans - c
w
.............................................
w
Which of the following customer does not fall under low risk category under KYC guidelines?
w
a. Salaried employee
b. Persons from lower strata of the society
c. Govt. departments
d. Trusts
Ans - d
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As per KYC guidelines, the banks cannot have correspondent arrangements with "Shell Banks‟. For this
purpose, the "Shell Bank‟ means ......
a. a bank having no existence but on paper only

b. a bank incorporated outside India and having a branch in India
c. a bank incorporated in a country where it has no existence and it is not regulated by a regulating
om
authority
d. a bank incorporated outside India and banned by UNO to have Operations other than in country of
incorporation
t.c
Ans - c
.............................................
es
All branches of Banks in all parts of the country should provide which of the following customer services,
more actively and vigorously to the members of public so that there is no need for them to approach the
RBI Regional Offices for this purpose?
kt
a. Issuing fresh / good quality notes and coins of all denominations on demand
b. Exchanging soiled / mutilated / defective notes
oc
c. Accepting coins and notes either for transactions or exchange
m
d. All of these
Ans - d
iib
.............................................
ca
With a view to extending the facility for the benefit and convenience of public, all branches of banks
have been delegated powers under Rule 2(j) of ...... for exchange of mutilated / defective notes free of
cost
iib
a. Reserve Bank of India (Note Refund) Rules, 2008

b. Reserve Bank of India (Note Refund) Rules, 2009
.ja
c. Reserve Bank of India (Note Refund) Rules, 2010

d. Reserve Bank of India (Note Refund) Rules, 2011
w
Ans - b
w
.............................................
w
A ...... means a note which has become dirty due to normal wear and tear and also includes a two piece
note pasted together wherein both the pieces presented belong to the same note and form the entire
note with no essential feature missing
a. Soiled Note
b. Mutilated Note
c. Imperfect Note
…………………………………………………………………………………………………………………………………………………………………
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d. Defective Note
Ans - a
.............................................
Which of the following statements is true with respect to RBI Guidelines relating to Soiled Notes?
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a. These notes should be accepted over bank counters in payment of Government dues and for credit to
accounts of the public maintained with banks
b. In no case, these notes should be issued to the public as reissuable notes and shall be deposited in
t.c
currency chests for onward transmission to RBI offices as soiled note remittances for further processing
c. Both of these
d. None of these
es
Ans - c
.............................................
kt
A ...... is a note of which a portion is missing or which is composed of more than two pieces. These notes
oc
may be presented at any of the bank branches and shall be accepted, exchanged and adjudicated in
accordance with Reserve Bank of India (Note Refund. Rules 2009
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a. Soiled Note
b. Mutilated Note
iib
c. Defective Note
d. Deliberately Cut Note
ca
Ans - b
.............................................
iib
Which of the following types of notes shall not be accepted by the bank branches for exchange. Instead,
the holders may be advised to tender these notes to the concerned Issue Office where they will be
.ja
adjudicated under a Special Procedure

w
a. Turned extremely brittle

b. Badly Burnt
w
c. Inseparably stuck up together

d. All of the above
w
Ans - d
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Punishment for offences under Prevention of Money Laundering Act is prescribed as ......
a. fine up to Rs.3 lac and imprisonment ranging b between 3 to 5 years

…………………………………………………………………………………………………………………………………………………………………
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b. fine up to Rs.3 lac and imprisonment ranging between 3 to 7 years

c. fine up to Rs.5 lac and imprisonment ranging between 3 to 5 years
d. fine up to Rs.5 lac and imprisonment ranging between 5 to 7 years
Ans - d
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W.r.t. guidelines pertaining to counterfeit notes, acknowledgement of the police authorities concerned
has to be obtained for notes forwarded to them both as consolidated ...... statement and FIR. If the
counterfeit notes are sent to the police by insured post, acknowledgement of receipt thereof by the
t.c
police should be invariably obtained and kept on record.
a. Weekly
es
b. Quarterly
c. Monthly
d. Bi-Monthly
kt
Ans - c
.............................................
oc
m
The progress made by banks in detection and reporting of counterfeit notes to Police, RBI, etc. and
problems thereof, should be discussed regularly in the meetings of which of the following State Level
Committees?
iib
a. State Level Bankers’ Committee (SLBC)

ca
b. Standing Committee on Currency Management (SCCM)

c. State Level Security Committee (SLSC)
d. All the above
iib
Ans - d
.............................................
.ja
As per Prevention of Money Laundering Act, the banks are required to maintain record of foreign
w
currency transactions of below Rs.10 lac even, if the aggregate of such transactions is Rs....... during ......
days/weeks/ months
w
a. Rs.10 lac, one month

w
b. Above Rs.10 lac, one month

c. Above Rs.10 lac, a single day
d. Rs.10 lac, a single day
Ans - b
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for a period of ...... from date of cessation of the transaction
a. 2 years
b. 5 years
c. 10 years
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d. 20 years
Ans - b
.............................................
t.c
As per Prevention of Money Laundering Act, the banks are required to maintain record of proofs
obtained for a period of ...... from date of cessation of the business relationship
es
a. 2 years
b. 5 years
kt
c. 10 years
d. 20 years
oc
Ans - b
m
.............................................
In case of high risk customers, full KYC is required to be done by the bank ......
iib
a. not less than 5 years

ca
b. not less than 3 years

c. not less than 2 years
d. not less than 1 years
iib
Ans - c
.............................................
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Where the number of mutilated / imperfect notes presented by a person is more than 5 pieces not
w
exceeding ...... in value, the tenderer should be advised to send such notes to nearby currency chest
branch by insured post giving his / her bank account details (a/c no, branch name, IFSC, etc. or get them
w
exchanged thereat in person

w
a. Rs. 20,000
b. Rs. 15,000
c. Rs. 10,000
d. Rs. 5,000
Ans - d
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Risk category review under KYC has to be undertaken by banks ......
a. not less than once in 2 years

b. not less than once in 1 years
c. not less than once in 6 months
d. not less than once in 3 months
om
Ans - c
.............................................
t.c
The Reserve Bank has decided that in addit ion to previous l imits, banks will be permit ted to reckon
government securities held by them up to another ...... of their Net Demand and Time Liabilities (NDTL)
under Facility to Avail Liquidity for Liquidity Coverage Ratio (FALLCR) within the mandatory Statutory
es
Liquidity Ratio (SLR) requirement as level 1 High Quality Liquid Assets (HQLa. for the purpose of
computing their Liquidity Coverage Ratio (LCR). Hence, the total carve-out from SLR available to banks
would be ...... of their NDTL
kt
a. 1percent; 11percent
b. 2percent; 11percent
oc
c. 3percent; 12percent
m
d. 4percent; 12percent
Ans - a
iib
.............................................
ca
As per the Reserve Bank of India guidelines for ‘On Tap’ Licensing of Universal Banks in the Private
Sector’, the Eligible Promoters include Individuals / professionals who are ‘residents’ and have ...... of
experience in banking and finance at a senior level.
iib
a. 8 years
b. 9 years
.ja
c. 10 years
d. 11 years
w
Ans - c
w
.............................................
w
Sector’, the entities/groups in the private sector that are ‘owned and controlled by residents’ and have a
successful track record for at least 10 years, provided that if such entity/group has total assets of Rs. 50
billion or more, the non-financial business of the group does not account for ...... or more in terms of
total assets/in terms of gross income are eligible for application.
a. 20 percent
…………………………………………………………………………………………………………………………………………………………………
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b. 25 percent
c. 30 percent
d. 40 percent
Ans - d
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Unit-India, monthly statement of large cash transactions called, CTR. It is to be Submitted for
transactions of Rs....... and within ...... of close of the month:
t.c
b. Above Rs.10 lac, 7 days
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c. Above Rs.10 lac, 15 days
d. Rs.10 lac, 5 days
kt
Ans - c
.............................................
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Unit-India, statement on suspicious transactions, called, STR. It is to be submitted for Transactions of
Rs....... and within ...... of arriving at conclusion:
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b. Above Rs.10 lac, 3 days
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c. Any amount, 3 days

d. Any amount, 7 days
iib
Ans - d
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KYC guidelines can be relaxed for small deposit accounts which include the deposit accounts ...... (i)
where the maximum balance shall not exceed Rs.50000, (ii) Totals of credit entries in the account would
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not exceed Rs.1 lac during an year, (iii) Total of cash or transfer withdrawal in a month should not
exceed Rs.10000/-
w

w

Ans - d
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Which of the following is the document for proof of customer identity under KYC?
a. telephone bill
b. PAN card
c. electricity bill
d. letter from employer
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Ans - b
.............................................
t.c
Where the number of mutilated / imperfect notes presented by a person is up to ...... pieces per day,
non-chest branches should normally adjudicate the notes and pay the exchange value over the counter.
es
a. 3
b. 5
c. 8
kt
d. 10
Ans - b
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.............................................
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If the non-chest branches are not able to adjudicate the mutilated notes, the notes may be received
against a receipt and sent to the linked currency chest branch for adjudication. The probable date of
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payment should be informed to the tenderers on the receipt itself and the same should not exceed .......
Bank account details should be obtained from the tenderers for crediting the exchange value by
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electronic means
a. 10 days
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b. 20 days
c. 30 days
d. 40 days
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Ans - c
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.............................................
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Banks are required to give notice to the small depositors under KYC, where ......
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a. Maximum balance exceeds Rs.50000

b. Total of credit entries in the account exceeds Rs.100000 during the year
c. Maximum balances exceeds Rs.40000 and total credit exceeds Rs.80000
d. maximum balances exceeds Rs.80000 and total credit exceeds Rs.40000
Ans - c
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Sector’, Existing non-banking financial companies (NBFCs) that are ‘controlled by residents’ and have a
successful track record for at least ...... years are eligible for application
a. 5 years
b. 10 years
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c. 12 years
d. 15 years
Ans - b
t.c
.............................................
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Sector’, Individual promoters/promoting entities/converting entities that have other group entities, shall
set up the bank only through an NOFHC. Not less than ...... of the total paid-up equity capital of the
NOFHC shall be owned by the Promoter / Promoter Group
kt
a. 49 percent
b. 50 percent
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c. 51 percent
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d. 55 percent
Ans - c
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.............................................
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The maximum permissible cash transactions in an account in a day, will be Rs. ...... Lacs (both receipts
and withdrawals)
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a. 5 lacs
b. 10 lacs
c. 20 lacs
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d. 50 lacs
w
Ans - b
.............................................
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RBI has decided to modify the procedure for exchanging mutilated / imperfect notes in order to improve
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customer service and enhance customer protection. Where the number of notes presented by a person
is up to ...... pieces with a maximum value of ...... per day, banks should exchange them over the
counter, free of charge
a. 10 pieces; Rs.5,000
b. 20 pieces; Rs.5,000
c. 15 pieces; Rs.3,000
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d. 20 pieces; Rs.4,000
Ans - b
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Where the number of mutilated / imperfect notes presented by a person exceeds 20 pieces or Rs.5,000
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in value per day, banks may accept them, against receipt, for value to be credited later. Banks may levy
service charges as permitted in the extant guidelines. In case tendered value is above ...... banks are
expected to take the usual precautions:
t.c
a. Rs. 10,000
b. Rs. 20,000
c. Rs. 40,000
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d. Rs. 50,000
Ans - d
kt
.............................................
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With regards to Licensing norms of Universal Banks in the Private Sector, the initial minimum paid-up
voting equity capital for a bank shall be ...... Thereafter, the bank shall have a minimum net worth of Rs.
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five billion at all times:
a. Rs.20 bn
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b. Rs.15 bn
c. Rs.10 bn
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d. Rs.5 bn
Ans - d
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What is the maximum permissible cash transaction for bullion dealers buying bullion directly from our
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Bank?
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a. 10 lacs
b. 25 lacs
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c. 50 lacs
d. 100 lacs
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Ans - c
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When the branch requires obtaining additional documents for high value accounts?
a. If the annual income /sales turnover are indicated 50 lacs and above
…………………………………………………………………………………………………………………………………………………………………
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b. If the annual income /sales turnover are indicated 100 lacs and above
c. If the annual income/sales turnover are indicated 25 lacs and above
d. All the above
Ans - b
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As per RBI guidelines, the promoter/s and the promoter group / NOFHC, as the case may be, shall hold a
minimum of ...... of the paid-up voting equity capital of the bank which shall be locked-in for a period of
five years from the date of commencement of business of the bank
t.c
a. 25 percent
b. 35 percent
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c. 40 percent
d. 45 percent
kt
Ans - c
.............................................
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For high value accounts where annual income/sales turn over are indicated 1 crore and above, what
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document bank shall obtain from a savings account holder? (i) Affidavit, (ii) Income tax returns of past 3
years, (iii) Last filed income tax returns
iib

ca

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Ans - d
.............................................
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To open account in the name of a proprietorship firm, which of the following documents can be used for
proof of name and address. (a) certificate / registration document issued by sales tax, (b) certificate /
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registration document issued by service tax, (c) certificate / registration document issued by
professional tax authorities, (d) IEC number issued by DGFT
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a. a and c only
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b. a, b and c only
c. b and d only
d. a to d any
Ans - d
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For High value accounts where annual sales turn over indicated 1 crore and above, what document bank
shall obtain from a business concern?
a. The last audited balance sheet

b. Income tax returns
c. Sales tax returns supporting the turn over
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d. Any one of the above
Ans - d
.............................................
t.c
The Government had amended the Prevention of Money Laundering (Maintenance of Records) Rules,
2005, for setting up of the ......
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a. Central KYC Records Registry (CKYCR).
b. Centralised KYC Records Registry (CKYCR)
kt
c. Core KYC Records Registry (CKYCR)
d. Common KYC Records Registry (CKYCR)
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Ans - a
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The Government of India has authorised the ...... to act as, and to perform the functions of the Central
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KYC Records Registry (CKYCR). All Regulated Entities (REs) shall capture KYC information for sharing with
the CKYCR in the manner prescribed for ‘individuals’ and ‘Legal Entities’
ca
a. Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI)
b. Reserve Bank of India
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c. Banking Codes and Standards Board of India (BCSBI)

d. Financial Action Task Force (FATF)
.ja
Ans - a
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As per RBI guidelines as regards promoter group shareholding, the promoter group shareholding shall be
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brought down to ...... within a period of ...... from the date of commencement of business of the bank
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a. 10 percent; 10 yrs
b. 15 percent; 15 yrs
c. 15 percent; 10 yrs
d. 12 percent; 15 yrs
Ans - b
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…………………………………………………………………………………………………………………………………………………………………
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The ...... would receive, store, safeguard and retrieve the KYC records in digital form of a client, for which
necessary amendments to the Rules have been made. The KYC records received and stored could be
retrieved online by any reporting entity across the financial sector for the purpose of establishing an
account based relationship
a. CRILC
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b. CKYCR
c. CERSAI
d. None
t.c
Ans - b
.............................................
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With respect to RBI Guidelines relating to Foreign Shareholding in the Bank, the foreign shareholding in
the bank would be as per the existing foreign direct investment (FDI) policy subject to the minimum
promoter shareholding requirement. At present, the aggregate foreign investment limit is ...... per cent
kt
a. 62 percent
b. 74 percent
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c. 78 percent
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d. 80 percent
Ans - b
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X has a current account with the bank and he agrees to receive a cheque of Rs. 10 lac from B and on the
strength of this amount of Rs.10 lac, he issues 5 cheques of Rs.1.90 each in the name of 5 different
persons and retains the balance amount as his commission. Such type of transaction is known as:
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a. money agency transaction

b. money pipe transaction
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c. money mule transaction

d. money flow transaction
w
Ans - c
w
.............................................
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The study of counterfeit currency has unearthed that fake Indian currency notes (FICN) worth Rs. ......
crore are infused into the Indian market every year with agencies only being able to intercept one third
of them
a. Rs. 50 Crore
b. Rs. 60 Crore
c. Rs. 70 Crore
…………………………………………………………………………………………………………………………………………………………………
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d. Rs. 80 Crore
Ans - c
.............................................
Which of the following points are true with respect to RBI guidelines relating to Detection of Counterfeit
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Notes?
a. Banknotes tendered over the counter / received directly at the back office / currency chest through
bulk tenders should be examined for authenticity through machines
t.c
b. No credit to customer’s account is to be given for counterfeit notes, if any, detected in the tender
received over the counter or at the back-office / currency chest
c. In no case, the counterfeit notes should be returned to the tenderer or destroyed by the bank
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branches / treasuries
d. All of these
kt
Ans - d
.............................................
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Notes determined as counterfeit shall be stamped as ...... and impounded in the prescribed format. Each
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such impounded note shall be recorded under authentication, in a separate register.
a. Counterfeit note
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b. Fake note
c. Duplicate note
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d. Any of these
Ans - a
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An individual with a bank account is recruited to receive cheque deposits or wire transfers and then
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transfers these funds to accounts held on behalf of another person or to other individuals, minus a
certain commission payment. This is called as ......
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a. Money agency transaction

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b. Money pipe transaction

c. Money Mule transaction
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d. Money channel transaction
Ans - c
.............................................
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Monthly cash transactions report (CTR) is to d be submitted by the bank to FIU within ......
a. 45 days of close of the month

b. 30 days of close of the month
c. 25 days of close of the month
d. 15 days of close of the month
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Ans - d
.............................................
t.c
In case of high risk customers, the customer identification data is to be updated by the bank ......
a. Not less than 5 years
es
b. Not less than 3 years
c. Not less than 2 years
d. Not less than 1 year
kt
Ans - c
.............................................
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In case of LOW risk customers, the customer identification data is to be updated by the bank ......
a. Not less than 10 years

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b. Not less than 3 years

c. Not less than 2 years
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d. Not less than 1 year
Ans - b
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.............................................
When a banknote tendered at the counter of a bank branch/back office and currency chest or treasury is
.ja
found to be counterfeit, an acknowledgement receipt in the prescribed format must be issued to the
tenderer, after stamping the note. The receipt, in running serial numbers, should be authenticated by
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the ...... and ...... The receipt is to be issued even in cases where the tenderer is unwilling to countersign
it.
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a. Cashier, Branch Manager

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b. Cashier; Tenderer
c. Branch Manager; Tenderer
d. None of these
Ans - b
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Which of the following points are correct with regards to agreement between RBI and commercial banks
relating to acceptance of coins in exchange of notes?
a. The bank branches should accept coins in exchange of notes

b. They should accept coins of all denominations which are legal tender under the Indian Coinage Act,
2011 from any member of public without any restriction and pay the value in notes
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c. They should use Coin counting machines or accept coins by weight for large receipts to facilitate the
customers
d. All the above
t.c
Ans - d
.............................................
es
The coins of denomination of ......, issued from time to time, ceased to be legal tender for payments as
well as account with effect from June 30, 2011
kt
a. 20 Paise and below
b. 25 Paise and below
c. 50 Paise and below
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d. All of these.
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Ans - b
.............................................
iib
All coins of denomination of 25 Paise and below should be retained in the (SCDs) of the bank till further
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advise from Reserve Bank of India. What does SCD stand for?
a. Small Coin Depots

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b. Small Currency Depots

c. Small Coin Deposits
d. Small Currency Deposits
.ja
Ans - a
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.............................................
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The following is not covered under PMLA?

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a. Regional Rural Banks

b. Primary co operative banks
c. Private Banks and Non-scheduled Banks
Ans - d
.............................................
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For cases of detection of counterfeit notes upto ...... pieces, in a single transaction, a consolidated report
in the prescribed format should be sent by the Nodal Bank Officer to the police authorities or the Nodal
Police Station, along with the suspect counterfeit notes, at the end of the month.
a. 8
b. 6
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c. 4
d. 3
Ans - c
t.c
.............................................
In case of an in-operative and dormant account the KYC norms need to be adhered to at ......
es
a. Three years intervals
b. Five years intervals
kt
c. Two years intervals
d. At the time of converting it into an operative account
oc
Ans - d
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Under which of the following schemes SB account can be opened for Migratory labours?
iib
a. No-frill accounts
ca
b. Small deposit accounts

c. General Savings scheme(SBGEN)
d. Union Super Salary Account
iib
Ans - b
.............................................
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The bank has to obtain KYC and AML compliance certificate on ...... basis from the branches/regional
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office and put up the same to audit committee of the Board for review.
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a. Monthly
b. Quarterly
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c. Half yearly
d. Annually
Ans - b
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The total time period given to small deposit account holders for submission of KYC documents ......
a. 12 months
b. 12 months + 12 months
c. 6 months
d. 6 months + 6 months
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Ans - b
.............................................
t.c
Under KYC guidelines photographs are taken from the account holders ......
a. To check frauds
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b. For identification and for checking the opening of benami accounts
c. To prevent money laundering
d. All of the above
kt
Ans - b
.............................................
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The risk classification has to be reviewed by branches every 6 months by going through ......
a. Profile of the customer

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b. Operations in the account

c. Volume of transactions
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d. All the above
Ans - d
iib
.............................................
How Many digits are there in AADHAAR number?

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a. 12
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b. 15
c. 9
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d. 10
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Ans - a
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Who will be the contact point for all counterfeit note detection related activities ......
a. Nodal currency chest officer at regional office level

b. Chest branch directly
…………………………………………………………………………………………………………………………………………………………………
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c. PBOD, Regional Office

d. All the above
Ans - a
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Inter-sol transactions of RS. ...... lacs and above confirmation from the base branch should be obtained
over phone.
a. 25
t.c
b. 50
c. 10
d. 5
es
Ans - b
.............................................
kt
What objective parameters can be used for enhanced due diligence? (i) Customer location, (ii) Financial
status, (iii) Nature of business
oc
m
iib

ca
Ans - d
.............................................
iib
The full value paid notes will be treated as chest remittance by the Issue Office while the half value paid
notes and rejected notes will be treated as notes tendered for ...... and processed accordingly
.ja
a. Settlement
b. Adjudication
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c. Exchange
d. None of these
w
Ans - b
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.............................................
All chest branches are required to submit to Issue Offices a ...... statement showing the number of notes
adjudicated during that period
a. Fortnightly
b. Monthly
…………………………………………………………………………………………………………………………………………………………………
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c. Quarterly
d. Half Yearly
Ans - b
.............................................
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For cases of detection of counterfeit notes of ...... pieces, in a single transaction, the counterfeit notes
should be forwarded by the Nodal Bank Officer to the local police authorities or the Nodal Police Station
for investigation by filing FIR in the prescribed format.
t.c
a. 8 or more
b. 6 or more
c. 5 or more
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d. 4 or more
Ans - c
kt
.............................................
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PAN (Permanent Account Number) is compulsory for Fixed Deposits, Remittances like DDs/TTS/RTCs etc
......
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a. if the amount exceeds Rs.10,000
b. if the amount exceeds Rs.25,000
iib
c. if the amount exceeds Rs.50,000

d. no such limit is fixed by the Income Tax Authorities
ca
Ans - c
.............................................
iib
What are the responsibility of the senior management? (i) Appointment of PO, (ii) Managing the risk of
money laundering, (iii) Internal Reporting Procedures
.ja

w

w

w
Ans - d
.............................................
Which of the following is an example of smurfing?
a. Wiring money to a foreign country

b. A broker buying dollars with rupees
…………………………………………………………………………………………………………………………………………………………………
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c. A drug dealer asking a stranger to buy money order with drug money
d. All of the above
Ans - c
.............................................
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Scrutiny of instrument is very essential through ultra violet light for cash transactions above Rs. ...... and
for clearing and transfer above Rs.......
a. Rs. 10000/- and Rs.50000/-
t.c
b. Rs. 25000/- and Rs. 50000/-
c. Rs. 50000/- and Rs. 50000/-
d. Rs. 10000/- and Rs. 25000/-
es
Ans - a
.............................................
kt
A copy of the monthly consolidated report / FIR shall be sent to the ...... constituted at the Head Office
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of the bank (only in the case of banks), and in the case of the treasury, it should be sent to the Issue
Office of the Reserve Bank concerned.
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a. Forged Note Vigilance Cell
b. FATCA
iib
c. Banking Ombudsman
d. Financial Action Task Force
ca
Ans - a
.............................................
iib
Absence of continuous transactions in an account up to 21 months will be treated as ......

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a. Active accounts
b. Dormant accounts
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c. Inactive accounts
d. Operative accounts
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Ans - c
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.............................................
Absence of continuous transactions in an account for a period of more than 24 months ......
a. Active accounts
b. Dormant accounts
c. Inactive accounts
…………………………………………………………………………………………………………………………………………………………………
Facebook Groups -
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d. Operative accounts
Ans - b
.............................................
In the month of December 2012 RBI eases KYC norms for banks. Which of the following is true?
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a. No need of introduction by the existing customer for opening SB account
b. Aadhaar to be accepted as proof of identity and address
c. Allows rent agreements as a valid proof of identity
t.c
d. Job cards given under MGNREGA would be a valid document
Ans - a
es
.............................................
For each Failures of non-reporting or delayed reporting of forged/counterfeit currency notes attracts
kt
penalty which varies from ...... to ......
a. Rs.10000/- to Rs. 50000/-

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b. Rs. 25000/- to Rs. 50000/-
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c. Rs. 10000/- to Rs. 100000/-
d. Rs. 50000/- to Rs. 200000/-
iib
Ans - a
.............................................
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Which type of SB account can be opened on the basis of self attested photograph and affixing the
signature or thumb impression in the account opening form of the bank in the presence of a designated
iib
officer of the bank?
a. General SB account
.ja
b. No frill SB account
c. Small Accounts
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d. Basic SB account
w
Ans - c
.............................................
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Which of the following is true regarding small accounts? (i) For migratory workers and of small means,
(ii) The aggregate credit in a financial year does not exceed Rs. 1 lac, (iii) Balance at any given point of
time does not exceed Rs. 50000/-

…………………………………………………………………………………………………………………………………………………………………
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Ans - d
.............................................
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Demand drafts of Rs. ...... and above are to be issued with account payee crossing only
a. 50000/-
b. 20000/-
t.c
c. 10000/-
d. 25000/-
es
Ans - b
.............................................
kt
The scheme code for opening small accounts is ......
a. SBGEN
oc
b. SBFRL
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c. SBFRL labeled with SMALLFRL
d. SBPEN
iib
Ans - c
.............................................
ca
Penal interest will be levied in all cases where the bank has enjoyed 'ineligible' credit in its current
account with Reserve Bank on account of which of the following reasons pertaining to transactions?
iib
a. Wrong reporting / delayed reporting / non-reporting of transactions

b. Shortages in chest balances / remittances
.ja
c. Shortages due to pilferage / frauds

d. All of the above.
w
Ans - d
w
.............................................
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Which type of cash balance is not eligible for inclusion in the Chest balances? (i) Cash held in the custody
of joint custodians and 'freely available' to them, (ii) Cash kept for safe custody in sealed covers for
whatever reasons, (iii) Cash in trunks/bins under the lock and key of any official/s other than the Joint
Custodians or bearing a third lock put by any official in addition to the two locks of the Joint Custodians
a. All from (i) to (iii)

b. (i) & (ii) only
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c. (ii) & (iii) only

d. (i) & (iii) only
Ans - c
.............................................
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What is the Penalty to be imposed on banks for deficiencies in exchange of notes and coins/remittances
sent to RBI/operations of currency chests etc. with respect to shortages in soiled note remittances and
currency chest balances for notes in denomination upto Rs.50?
t.c
a. Rs. 50 per piece in addition to the loss
b. Rs. 25 per piece in addition to the loss
c. Rs. 20 per piece in addition to the loss
es
d. Rs. 10 per piece in addition to the loss
Ans - a
kt
.............................................
oc
Which of the following regarding FATF is TRUE? (i) It is an inter-Governmental body established in 1989
by the Ministries of Member Jurisdictions, (ii) The objectives of the FATF are to set standards and
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promote effective implementation of legal, regulatory and operational measures for arresting Money
laundering, terrorist financing and other related threats to the integrity of the International Financial
system, (iii) It is a Policy Making Body which works to generate the necessary political will to bring about
iib
national legislative and regulatory reforms in the areas of money laundering and terrorist financing
ca

iib
Ans - d
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.............................................
w
Which of the followings regarding the concept of cooling period is true? (i) Only limited cash in and cash
out transactions at the base branch will be allowed, (ii) No inter-sol transaction will be allowed, (iii) No
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alternate delivery channels will be operationalised and for ensuring KYC compliance
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Ans - d
.............................................
…………………………………………………………………………………………………………………………………………………………………
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Representations made for reconsideration of the Reserve Bank's decision for levy of penal interest for
delayed reporting on account of genuine difficulties faced by chests especially in hilly/remote areas and
those affected by natural calamities, etc., may be made to the Issue Office concerned through the Head
/ Controlling office of the bank concerned within ...... from date of debit of the bank concerned
a. A week
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b. A fortnight
c. A month
d. Two months
t.c
Ans - c
.............................................
es
It is decided that all new accounts will have a cooling period of ...... days
a. 7 days
kt
b. 6 days
c. 8 days
d. No Cooling Period
oc
m
Ans - d
.............................................
iib
Penal interest shall be levied at the rate of ...... over the prevailing Bank Rate for the period of delayed
reporting / wrong reporting/non-reporting / inclusion of ineligible amounts in chest balances
ca
a. 1 percent
b. 2 percent
iib
c. 3 percent
d. 4 percent
.ja
Ans - b
.............................................
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...... is the central national agency of India responsible for receiving, processing, analyzing, and
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disseminating information of suspect financial transactions?

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a. Reserve bank of India

b. SEBI
c. IRDA
d. FIU-INDIA
Ans - d
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For KYC policy, the customer has been defined to include ...... (i) one on whose behalf the account is
Maintained (i.e. the beneficial owner), (ii) beneficiaries of transactions conducted by professional
intermediaries, such as Stock Brokers, Chartered Accountants, Solicitors etc. as permitted under the law,
(iii) any person or entity connected with a financial transaction which can pose significant reputational
or other risks to the bank, say, a wire transfer or issue of a high value demand draft as a single
transaction
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t.c
Ans - d
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Placement is one of the important steps in money laundering. It is otherwise called as ......
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a. Smurfing
b. Smothering
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c. Smoothing
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d. Structuring
Ans - a
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While opening an account of society/association/club, the following is must ...... (i) Resolution for
opening the account, (ii) Copy of the bye laws, (iii) Certificate of Registration
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Ans - d
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While opening an account of Hindu Undivided family, the following is must ......
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a. HUF letter to be signed by karta

b. Introduction letter from the other co-parcners of the HUF
c. Registration letter from the government
Ans – a
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Which of the following document/s can be accepted by banks as a proof of Customer Identification?
a. Electricity Bill
b. Salary Slip
c. Income/Wealth Tax Assessment Order
d. Election I card
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Ans - d
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All Counterfeit Notes received back from the police authorities/courts may be carefully preserved in the
safe custody of the bank and a record thereof be maintained by the branch concerned. These
Counterfeit Notes at branches should be subjected to verification on a ...... basis by the Officer-in-Charge
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of the bank office concerned. They should be preserved for a period of ...... years from the date of
receipt from the police authorities.
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a. Half-yearly; 3
b. Yearly; 3
c. Quarterly; 3
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d. Bi-monthly; 3
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Ans - a
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As per RBI guidelines, Counterfeit notes, which are the subject matter of litigation in the court of law
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should be preserved with the branch concerned for a period of ...... years after conclusion of the court
case.
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a. 1 year
b. 2 years
c. 3 years
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d. 4 years
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Ans - c
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With regards to RBI guidelines relating to Time Limit for Reporting, the currency chests should invariably
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report all transactions through ICCOMS on the same day by ...... by uploading data through the Secured
Website (SWS) to their respective link offices. Link offices should invariably report the consolidated
position to the Issue Offices latest by ...... on the same day.
a. 7 PM; 9PM
b. 8 PM; 10PM
c. 9 PM; 11PM
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d. 10 PM; 12PM
Ans - c
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What is the penalty to be imposed on banks for deficiencies in exchange of notes and coins/remittances
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sent to RBI/operations of currency chests etc. with respect to shortages in soiled note remittances and
currency chest balances for notes in denomination of Rs. Rs.100 & above?
a. Equal to the value of the denomination per piece in addition to the loss
t.c
b. Rs. 80 per piece in addition to the loss
c. Rs. 75 per piece in addition to the loss
d. Rs. 50 per piece in addition to the loss
es
Ans - a
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In the event of delay in reporting currency chest transactions, penal interest will be levied on the
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amount due from the chest holding bank for the period of delay which will be calculated on ...... basis.
However, Reserve Bank may at its discretion grant appropriate grace period in the matter of levy of
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penal interest.
a. T+0 basis
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b. T+1 basis
c. T+2 basis
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d. T+3 basis
Ans - a
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Which of the following points are true with respect to levy of Penal interest on wrong reporting?
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a. Penal interest will be levied in respect of all cases of wrong reporting in the same manner till the date
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of receipt of corrected advice by Reserve Bank.

b. Penal interest will invariably be levied in all cases of wrong reporting in the Link Office Statements
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even if the reporting was done correctly in the chest slips.

c. Both of these
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d. None of these
Ans - c
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As per RBI guidelines, Soiled note remittances to RBI /diversion to other currency chest/s should not be
shown as withdrawal by chest/s / link offices. In case such remittances are wrongly reported as
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'withdrawals', a penalty of ...... will be levied irrespective of the value of remittance and period of such
wrong reporting
a. Rs. 25,000
b. Rs. 35,000
c. Rs. 50,000
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d. Rs. 75,000
Ans - c
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t.c
As per RBI guidelines relating to reporting of Currency Chest Transactions, the minimum amount of
deposit into/withdrawal from currency chest will be ...... and thereafter, in multiples of Rs.......
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a. 50,000; 10,000
b. 1,00,000; 50,000
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c. 1,50,000; 50,000
d. 2,00,000; 1,00,000
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Ans - b
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In case, mutilated notes detected in soiled note remittances and currency chest balances, the penalty
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levied shall be ...... per piece irrespective of the denomination.

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a. Rs. 20
b. Rs. 50
c. Rs. 75
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d. Rs. 100
Ans - b
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What should relevant employees be aware of? (i) Policies and procedures put in place to prevent money
laundering, (ii) Procedures put in place to prevent money laundering, (iii) KYC/AML guidelines issued by
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the RBI
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Ans - d
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A lawyer who banks with you is a sole practitioner. He wants to open a trust account for a client. He
provides you with the trust documents and the name and address of the trust beneficiary but is unable
to provide additional details due to a client confidentiality obligation. You notice that the address is from
an overseas jurisdiction. What level of due diligence would be required?
a. This situation does not require enhanced due diligence. You know the lawyer well and you have been
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provided with the trust documents and identity of the beneficiary.
b. This situation requires enhanced due diligence because an offshore jurisdiction is involved
c. This situation requires enhanced due diligence because the lawyer is clearly hiding something when
he says he is under a client confidentiality obligation
t.c
Ans - b
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While opening an account in the name of trust, the following is must ......
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a. Trust deed and registration of trust deed
b. Introduction from trustees of the trust
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c. Introduction from the registrar of co-operative societies
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Ans - a
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The cut off limit for monitoring transactions is ......
a. All transactions (irrespective of amount) of suspicious nature

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b. All transactions of Rs. 10 lacs and above

c. Both A & B
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Ans - c
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Money Laundering refers to ......

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a. Transfer of assets/cash form one account to another

b. Conversion of illegal money into legal through banking channels
c. Conversion of cash into gold for hoarding
d. Conversion of assets into cash to avoid income tax
Ans - b
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One of the important steps for opening NRI account is ......
a. Authentication /verification of signature of the NRI by a bank abroad/by the Indian

Embassy/Relationship Managers posted abroad
b. Authentication /verification of signature of the NRI by the relative of NRI in India
c. Authentication /verification of signature of the NRI by the friend of NRI who are staying abroad
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d. Authentication /verification of signature of the NRI by a local person known to the bank
Ans - a
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t.c
While opening an account in the name of a company, the most important document to be seen is ......
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a. List of employees/directors of the company
b. List of promoters/shareholders of the company
c. Memorandum and Articles of Association of the company
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d. Instructions of the Registrar of Companies
Ans - c
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In case of societies, the important document to be verified is ......
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a. Copy of bye-Laws
b. Certificate given by ROC
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c. Certificate given by the Local Authorities

d. No document is to be verified in case of societies, as societies are exempted by Registrar
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Ans - a
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Under KYC guidelines, where a customer does not comply with the KYC requirement, his account can be
closed. (i) decision to close the account should be taken at a high level, (ii) account Should be closed
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after giving due notice to the customer, (iii) account should be closed after explaining reasons to the
customer
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Ans - d
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While opening an account for a partnership firm, the vital documents to be produced by the firm is ......
a. Partners “MOU”
b. Partnership deed and Letter of Partnership
c. Registration certificate of partnership
d. Partners tax clearance documents
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Ans - b
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t.c
PAN (Permanent Account Number) is compulsory for Fixed Deposits, Remittances like DDs/TTs/TCs etc
......
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a. If the amount exceeds Rs.10000/-
b. If the amount exceeds Rs.50000/-
c. If the amount of Rs.50000/- and Above
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d. No such limit is fixed by the Income tax authorities
Ans - c
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The authority to which branches of commercial banks should report suspected accounts is ......
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a. Controlling office/Regional Office

b. Directly to FIU-IND
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c. Directly to RBI
d. Directly to Finance Ministry/Policies
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Ans - a
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The word "Customer‟ is defined in which of the following act?

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a. RBI act
b. BR act
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c. KYC/AML guidelines
d. Negotiable Instruments act
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Ans - c
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What do you mean by Threshold Limit in KYC/AML guidelines?
a. 25 % of the annual income in the case of individuals

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b. One month's turnover in the case of business enterprises

c. Both A & B
Ans - c
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When Customer Identification Procedure (CIP) shall be carried out? (i) While establishing a banking
relationship, (ii) While carrying out a financial transactions, (iii) When there is a doubt about authenticity
or veracity or the adequacy of the previously obtained customer identification data
t.c
es
kt
Ans - d
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What should awareness and training of staff on AML/KYC, should cover? (i) need to know the true
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identity of the customer, (ii) need to know enough about the nature of business activities expected, (iii)
to know what might constitute suspicious activity
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ca

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Ans - d
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Money laundering involves three independent steps that often occurs simultaneously. Which of the
following best explains the layering in the process of money laundering?
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a. Physically placing bulk cash proceeds

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b. Separating the proceeds of criminal activity from their origin, through complex level of financial
transactions
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c. Providing a legitimate explanation for the illicit proceeds

Ans - b
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Expand UCIDC
a. Unique Customer Identification Code

b. Uniform Customer Identification Code
c. Universal Customer Identification Code
d. Uninterrupted Customer Identification Code
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Ans - a
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t.c
practice. Effective information-gathering strategies enable building of a solid information base about
each customer. This is known as ......
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d. risk management
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Ans - b
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Which of the following is true in case of KYC norms for opening of bank accounts of foreign students? (i)
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Passport and admission letter sufficient to open NRO accounts, (ii) Up to 30 days student can operate
account with an inward foreign remittance cap of USD 1000 and maximum monthly withdrawal of Rs.
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50000/- after which local address proof will be required to be treated as normal NRO account, (iii)
Guidelines under RBI‟s Master circular and FEMA in this regard to be observed
iib

.ja

w
Ans - d
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When is induction training provided to employees?

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a. start of their employment

b. end of their employment
c. Depends upon trainer availability
d. Depends upon training schedule
Ans – a
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What should you consider when managing AML/CTF in your business? (i) Knowing your customer, (ii)
Destination of funds, (iii) Methods of delivery such as cash, telephone and internet banking

om
Ans - d
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t.c
What is/are audited by Internal Audit and Control teams of the banks? (i) adequacy of policies, (ii)
adequacy of procedures, (iii) system support to detect suspicious and potential money laundering
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transaction
kt
oc
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Ans - d
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...... are engaged in selling goods and providing services, with large volume of business and often
engaged in cash dealings.
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a. Shell Companies
b. Front Companies
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c. Offshore Banking
d. Hawala Systems
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Ans - b
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What suspicion does frequent cash deposits in the account followed by ATM withdrawals at different
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locations with no valid explanation, can lead to?

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a. Doubtful source of cash deposited in bank account

b. Doubtful use of safe deposit locker
c. Suspicious use of ATM card
Ans - c
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ALL THE VERY BEST FOR YOUR EXAMS
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SAMPLE QUESTIONS FOR oc
CERTIFICATE EXAMINATION IN
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ANTI-MONEY LAUNDERING &
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KNOW YOUR CUSTOMER

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Though we had taken enough care to go through the questions, we shall not be responsible for
any loss or damage, resulting from any action taken on the basis of the contents. We advise
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everyone to update yourself with the latest information through RBI website and other
authenticated sources. In case you find any incorrect/doubtful information, kindly update us
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also (along with the source link/reference for the correct information) as lot of questions were
shared by many people.
January 2019 K Murugan, MCA MBA CAIIB

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January 2019 K Murugan, MCA MBA CAIIB

ANTI-MONEY LAUNDERING & KNOW YOUR CUSTOMER - GENERAL INFORMATION

Examination will be conducted in English only.

(iii) There will NOT be negative marking for wrong answers.

The duration of the examination will be of 2 hours.

PERIODICITY AND EXAMINATION CENTRES:

STUDY MATERIAL / COURSEWARE

Cut-off Date of Guidelines / Important Developments for Examinations

of the current developments. However, there could be changes in the developments /

In order to address these issues effectively, it has been decided that:

Certificate Examination in Anti-Money Laundering & Know Your Customer

(ii) Know Your Customer - Introduction and overview

Intermediaries etc., Client Accounts opened by Professional Intermediaries - Trust / Nominee or

Accounts of ‘non-face-to-face’ Customers - Qualitative data - Joint accounts - Minor accounts -

Monitoring Accounts - Customer research - Suspicious transactions

Anti-Money Laundering & Know Your Customer

d. All the above

a. Only (i) and (ii)

b. Only (i) and (iii)

d. (i), (ii) and (iii)

a. Rs. 5 crores and above

c. Rs. 50 lacs and above

a. Low Risk customers

a. Anti-Money Laundering Act, 2005

b. Active Money Laundering Act (AMLA), 2003

a. Only (i) and (ii)

b. Only (i) and (iii)

d. (i), (ii) and (iii)

Which of the following is a high risk activity?

a. A customer purchasing a car from a local garage

c. A loan for home improvement

a. a bank having no existence but on paper only

client/s by professional intermediaries, like Lawyers and Chartered Accountants, etc.,

a. Rs.10 lac, one month

a. no such condition is applicable

potentially high-risk customers. This is known as ......

a. Only (i) and (ii)

a. Only (i) and (ii)

b. Only (i) and (iii)

account issued by a credit union

a. Only (i) and (ii)

b. sighting original identification such as birth certificate and drivers licence

c. Bank statement of account

financial institutions to make it difficult to track?

a. Only (i) and (ii)

a. Only (i) and (ii)

b. Only (i) and (iii)

a. Custom Trafficking Report

a. Up to Rs. 15 lacs for violating every single norms

b. Up to Rs. 25 lacs for violating every single norms

d. Up to Rs.100 lacs for violating every single norms

laundering by the financial institutions in case of suspicious transactions is ......

Dormant/Inoperative account means ......

a. No debits/credits in account for a certain period

b. Dead account without any operation for long

a. Only (i) and (ii)

c. Only (ii) and (iii)

a. (I), (II), (III) and (IV) above

...... is the provision of banking services by one bank to another bank.

a. Layering, Placement, Refining

a. Section 35 of Banking Regulation Act