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

What is a potential legal consequence for failing to maintain confidentiality of SAR filings?

1. Revocation of business license

2. Imprisonment for an unspecified term

3. Violation of law

4. Heavy fines and penalties

The correct answer is: Violation of law

The maintenance of confidentiality regarding Suspicious Activity Reports (SARs) is critical because it helps protect the integrity of investigations into potential money laundering or other financial crimes. A potential legal consequence linked to breaching this confidentiality is a violation of law. SARs are intended to remain confidential, and disclosing information related to these filings can not only compromise ongoing investigations but also violate specific regulations imposed by laws such as the Bank Secrecy Act in the U.S. When an individual or entity fails to maintain the confidentiality of SAR filings, they can face legal implications that categorize such actions as violations of relevant statutory or regulatory frameworks. This can lead to various consequences, such as administrative actions or civil penalties, depending on the severity of the breach and the jurisdiction involved. While heavy fines and penalties are a consideration after a violation has occurred, the overarching legal consequence is framing this act as a violation of the law, which can potentially lead to further repercussions. The other options suggest more severe consequences, such as imprisonment or revocation of a business license, which, although serious, are not the direct legal classification of failing to maintain confidentiality of SARs. Consequently, acknowledging the breach as a violation of law more accurately captures the legal framework governing the confidentiality of these sensitive documents