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

Which type of account does not show activity other than interest or maintenance fees?

1. Dormant Account

2. Active Account

3. Joint Account

4. Business Account

The correct answer is: Dormant Account

A dormant account is defined specifically as one that has not had any customer-initiated activity for a certain period of time, typically ranging from six to twelve months, depending on the institution's policies. The only transactions that may occur in such an account are those related to the accrual of interest or the deduction of maintenance fees. This lack of active transactions means that the account holder is not regularly using their account for standard banking activities like deposits or withdrawals. In contrast, an active account is characterized by frequent transactions and customer engagement. Joint accounts involve more than one account holder, usually facilitating shared usage, which would result in more frequent activity. Business accounts similarly are utilized for operational purposes, leading to regular deposits and withdrawals. Therefore, both joint and business accounts would display a higher level of activity compared to a dormant account. Understanding the characteristics of dormant accounts is critical in the context of anti-money laundering, as these accounts can be targeted for illicit activities due to their inactive status.