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

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What is the acronym for a system that allows for the transfer of funds electronically?

The correct answer is: EFT

The acronym EFT stands for Electronic Funds Transfer, which is a system that facilitates the electronic movement of money from one bank account to another. This process allows for real-time processing of transactions and helps streamline payments, making it more efficient compared to traditional methods such as checks or cash. EFT encompasses various forms of electronic payment, including direct deposits, wire transfers, and online bill pay, effectively modernizing how individuals and businesses manage their financial transactions. This system is crucial in today's digital economy, where speed and convenience in financial dealings are highly valued. Other options like EDD (Enhanced Due Diligence), EFA (Electronic Funds Access), and AML (Anti-Money Laundering) relate to different aspects of banking and finance but do not pertain specifically to electronic transfers of funds. Understanding the role of EFT within the framework of financial transactions highlights its importance in anti-money laundering efforts by ensuring that electronic transactions are monitored for suspicious behavior, reinforcing the overall integrity of the financial system.