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

What types of businesses fall under FATF Recommendations for non-financial professionals?

1. Only banks and insurance companies.

2. Only retail businesses.

3. Casinos, real estate agents, and legal professionals.

4. Manufacturers and wholesalers.

The correct answer is: Casinos, real estate agents, and legal professionals.

The correct choice identifies a range of businesses that fall under the Financial Action Task Force (FATF) Recommendations for non-financial professionals. Specifically, casinos, real estate agents, and legal professionals are recognized as entities that can be susceptible to money laundering and terrorist financing activities. These types of businesses often handle large sums of money or engage in complex transactions, which can create vulnerabilities that financial criminals may exploit. For instance, casinos can facilitate significant cash transactions that may not be adequately monitored without effective anti-money laundering (AML) controls. Real estate transactions can involve substantial amounts of money and often lack transparency, making them a target for money laundering. Similarly, legal professionals may assist clients with various financial dealings, which could inadvertently involve laundering illicit funds if appropriate safeguards are not in place. Understanding the specific non-financial sectors designated by FATF is crucial, as this awareness guides professionals in implementing necessary AML measures to mitigate risks associated with these industries. Other options fail to encompass the diverse range of professional services and businesses that the FATF has recognized as being in need of regulatory oversight in terms of AML compliance.