Certified Anti-Money Laundering Specialist Certification (CAMS) Practice Exam

What does the term 'FIU' refer to?

1. Financial Identifiers Unit

2. Financial Intelligence Unit

3. Financial Investments Unit

4. Financial Investigation Unit

The correct answer is: Financial Intelligence Unit

The term 'FIU' refers to the Financial Intelligence Unit, which is a central agency responsible for receiving, processing, and analyzing reports made by financial institutions concerning suspicious or unusual financial activities. The primary goal of an FIU is to combat money laundering and terrorist financing by collecting and disseminating financial intelligence that can be used by law enforcement agencies and relevant authorities. The FIU plays a critical role in a country's anti-money laundering (AML) framework by ensuring that financial institutions comply with reporting requirements and by serving as a liaison between the financial sector and law enforcement. Additionally, the FIU may provide training and guidance to financial institutions on identifying and reporting suspicious activity, thereby enhancing the overall effectiveness of the AML regime. The other choices do not accurately capture the function or purpose of an FIU. The term 'Financial Identifiers Unit,' 'Financial Investments Unit,' and 'Financial Investigation Unit' do not reflect the established terminology or the specific responsibilities associated with an FIU in the context of combating financial crime. Therefore, the correct term that aligns with the recognized roles and responsibilities in AML efforts is the Financial Intelligence Unit.