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

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Prepare for the Certified Anti-Money Laundering Specialist Certification (CAMS) exam. Study with multiple choice questions, each with hints and explanations. Boost your chances of success!

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What is the term for the opposing party in a transaction or trade?

Counter Party
Trade Partner
Transaction Participant
Client

The correct answer is: Counter Party

The term "counterparty" refers to the entity or individual that is on the opposite side of a transaction or trade. This is a commonly used term in finance, banking, and investment sectors to designate the party taking the opposite position in an agreement. In the context of transactions, identifying the counterparty is crucial as it signifies the entity with which one is conducting business, and it is important for assessing risk, compliance, and regulatory requirements. The other terms, while they may describe parties involved in a trade or transaction, do not capture the same specific legal or financial implication of being the opposite party. "Trade partner" often implies a mutual partnership, "transaction participant" could refer to any party involved in a deal, and "client" usually describes a customer or individual receiving services. Thus, "counterparty" is the precise term used to denote the opposing side in a financial transaction.