AML Compliance Quiz

9 – 50 Questions 12 min

This AML Compliance Quiz focuses on practical decisions in CDD and EDD, alert handling, SAR and CTR determinations, and sanctions screening. Use it to stress test how you tie customer risk ratings, transactional behavior, and investigative documentation back to U.S. regulatory expectations. Ideal for BSA officers, analysts, and AML investigators.

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Part 1 — Questions

Answer each question on paper. Do not turn the page until you are ready to check your work.

An examiner-ready customer risk rating should identify specific risk drivers such as products, geographies, delivery channels, expected volumes, and ownership complexity.

True
False

Customer due diligence (CDD) should establish a baseline of expected activity so that future monitoring can more easily identify unusual behavior.

True
False

Which customer most clearly warrants enhanced due diligence (EDD) at onboarding under a typical U.S. risk-based AML program?

Local retail bakery with a single domestic owner and small cash deposits
Money services business offering international remittances to higher risk jurisdictions with complex ownership
Community youth sports league collecting local membership fees
Salaried school teacher opening a personal checking account for payroll deposits

A small business customer makes three cash deposits of $4,000 each at different branches on the same business day. The activity matches the stated cash-intensive business profile, and there are no other red flags. Which BSA filing obligation is clearly triggered by the facts provided?

File a SAR only
File a CTR, and consider a SAR only if other suspicious indicators arise
File both a CTR and a SAR automatically
File neither a CTR nor a SAR

A Suspicious Activity Report (SAR) must always be filed whenever a Currency Transaction Report (CTR) is filed.

True
False

Which control is a core element of an effective OFAC sanctions compliance program under U.S. guidance?

Setting interest rates based solely on credit risk
Routine screening of customers and relevant transactions against sanctions lists
Automating loan underwriting decisions
Maintaining a customer complaint hotline

Which factor is least likely to increase an individual customer's AML risk rating in a typical U.S. retail banking context?

Owning a holding company in a secrecy jurisdiction with unclear business purpose
Operating a cash-intensive small business with daily deposits
Frequent large international wire transfers to higher risk jurisdictions
Receiving salary by direct deposit from a domestic employer and paying routine bills

If a sanctions screening alert has a very low match score, it can be closed without reviewing any identifiers such as date of birth or address.

True
False

You receive an alert for a small manufacturing customer that just sent its first wire transfer to a higher risk foreign country. Before deciding whether the activity is suspicious, what is the most appropriate first element to document in your alert narrative?

Personal opinion about the customer's honesty
Exact SAR form fields you expect to complete
Regulatory citations related to high risk countries
Customer profile and stated business activity

10.

Your sanctions screening system flags a possible match to an OFAC-listed individual for an incoming wire, but the name is common. What is the most appropriate next step before clearing or escalating the alert?

Compare key identifiers like date of birth and address to the list entry
Automatically block and report the transaction as a confirmed match
Escalate to law enforcement without further review
Close the alert immediately because the transaction amount is low

11.

You review an ACH transaction monitoring alert and determine that the customer's activity matches their stated payroll processing business with no suspicious indicators. Which closure comment is most examiner-ready?

Closed per manager instruction
Reviewed KYC, historical ACH volumes, counterparties, and peer activity; ACH credits align with documented payroll processing profile, no unusual patterns
No suspicious activity found
Legit transactions, customer seems fine

12.

When closing a transaction monitoring alert with no SAR filing, you should still document what you reviewed and why the activity was not considered suspicious.

True
False

13.

A cash-intensive business customer begins making alternating cash deposits and withdrawals between $9,500 and $9,900 almost every day, with no clear business need for same-day in-and-out activity. How should this pattern most likely be treated?

Close the alert because the customer previously indicated they handle cash
Treat as routine cash activity and close the alert without further review
Investigate further and likely file a SAR for suspected structuring even though individual transactions are under $10,000
File a CTR for each business day but avoid a SAR since no single transaction exceeds $10,000

14.

A long-standing customer with a moderate volume of domestic wires begins sending frequent wires to a new foreign counterpart in a jurisdiction your bank classifies as higher risk. What is the most appropriate CDD action?

Update the customer's expected activity profile to reflect the new foreign counterpart and document the rationale, considering whether EDD is now warranted
Immediately close the account without further analysis
Only monitor for CTR thresholds, since this is not cash activity
Do nothing because the customer has been with the bank for years

15.

A potential sanctions match shows an exact name and date of birth match to the OFAC list, but the address on your customer file is in a different country than the one on the list. What should you do next?

Close the alert immediately because the address is different
Escalate to the sanctions officer or compliance team for potential true hit evaluation
Ask the customer to update their address, then close the alert
Ignore the alert because the transaction amount is small

16.

If cash deposits always stay under $10,000, there is no need to evaluate them for structuring.

True
False

17.

An existing corporate customer rated medium risk adds a new majority owner who resides in a higher risk foreign jurisdiction and contributes a large capital injection. What is the most appropriate AML response?

Lower the customer risk rating because capital injections improve liquidity
Perform event-driven enhanced due diligence, including verifying the new owner's identity, beneficial ownership, and source of funds
Do nothing until the next scheduled periodic review
Automatically exit the relationship without further review

18.

Your monitoring system identifies customers with frequent cash activity near $10,000. Which behaviors most strongly indicate potential structuring designed to evade CTR reporting? Select all that apply.

A.Daily cash deposits between $9,000 and $9,900 across several related accounts, all made minutes apart
B.A single cash withdrawal of $11,000 with a bill of sale for a car purchase
C.Three cash deposits of $9,800 each on the same day at different branches for the same customer
D.A one-time cash deposit of $9,500 from a customer who typically deposits $500
E.One cash deposit of $12,500 with invoices supporting a documented equipment sale

19.

You are drafting a SAR narrative for unusual wire activity. Arrange the following narrative elements in the most examiner-friendly order.

Put these in the correct order (write 1–5 beside each):

____Summarize the customer profile and expected activity
____State the SAR filing decision and any ongoing monitoring plans
____Describe the alert trigger and unusual activity
____Analyze why the activity is or is not suspicious
____Detail the research and data sources reviewed

20.

Your institution detects multiple related accounts that send and receive high-value wire transfers among themselves on the same day, with funds quickly moving offshore and balances returning near zero. There is no clear business rationale. Which typology does this pattern most closely resemble?

Layering of funds through rapid in-and-out transfers among related accounts
Structuring through small cash deposits
Dormant account abuse
Simple savings behavior

21.

You are drafting a SAR for suspected funnel account activity. Which narrative approach best aligns with FinCEN guidance for clear, examiner-ready reporting?

Copy and paste the system alert details without modification
Explain who the customer is, summarize the pattern of activity over time, describe what you reviewed, and connect specific facts to why the activity is suspicious
List each transaction date and amount with no additional explanation
Describe your opinion that the customer is "probably laundering money" without linking facts to that conclusion

22.

You are assessing a private investment company for onboarding. Which characteristics would typically drive a higher inherent AML risk rating that may justify EDD and closer monitoring? Select all that apply.

A.Simple ownership by a publicly listed U.S. company with transparent filings
B.Transactions limited to small domestic checks under $5,000
C.Use of nominee directors and limited transparency into controlling parties
D.Non-resident beneficial owners located in high risk secrecy jurisdictions
E.Use of foreign correspondent accounts through nested relationships with other financial institutions

23.

After a detailed investigation of unusual wire transfers, you reasonably conclude that the activity is consistent with the customer's documented trade business and does not meet your institution's SAR criteria. To withstand examiner review of this no-file decision, what is the most appropriate documentation approach?

Delete the alert so it is not available for examiner review
Record a closure code of "not suspicious" with no narrative
Rely on system logs and do not enter any analyst notes
Write a concise narrative summarizing the customer profile, activity reviewed, sources consulted, and why SAR thresholds were not met

Part 2 — Answer key

Compare your answers after you have finished Part 1.

An examiner-ready customer risk rating should identify specific risk drivers such as products, geographies, delivery channels, expected volumes, and ownership complexity.
True
Customer due diligence (CDD) should establish a baseline of expected activity so that future monitoring can more easily identify unusual behavior.
True
Which customer most clearly warrants enhanced due diligence (EDD) at onboarding under a typical U.S. risk-based AML program?
Money services business offering international remittances to higher risk jurisdictions with complex ownership
A small business customer makes three cash deposits of $4,000 each at different branches on the same business day. The activity matches the stated cash-intensive business profile, and there are no other red flags. Which BSA filing obligation is clearly triggered by the facts provided?
File a CTR, and consider a SAR only if other suspicious indicators arise
A Suspicious Activity Report (SAR) must always be filed whenever a Currency Transaction Report (CTR) is filed.
False
Which control is a core element of an effective OFAC sanctions compliance program under U.S. guidance?
Routine screening of customers and relevant transactions against sanctions lists
Which factor is least likely to increase an individual customer's AML risk rating in a typical U.S. retail banking context?
Receiving salary by direct deposit from a domestic employer and paying routine bills
If a sanctions screening alert has a very low match score, it can be closed without reviewing any identifiers such as date of birth or address.
False
You receive an alert for a small manufacturing customer that just sent its first wire transfer to a higher risk foreign country. Before deciding whether the activity is suspicious, what is the most appropriate first element to document in your alert narrative?
Customer profile and stated business activity
Your sanctions screening system flags a possible match to an OFAC-listed individual for an incoming wire, but the name is common. What is the most appropriate next step before clearing or escalating the alert?
Compare key identifiers like date of birth and address to the list entry
You review an ACH transaction monitoring alert and determine that the customer's activity matches their stated payroll processing business with no suspicious indicators. Which closure comment is most examiner-ready?
Reviewed KYC, historical ACH volumes, counterparties, and peer activity; ACH credits align with documented payroll processing profile, no unusual patterns
When closing a transaction monitoring alert with no SAR filing, you should still document what you reviewed and why the activity was not considered suspicious.
True
A cash-intensive business customer begins making alternating cash deposits and withdrawals between $9,500 and $9,900 almost every day, with no clear business need for same-day in-and-out activity. How should this pattern most likely be treated?
Investigate further and likely file a SAR for suspected structuring even though individual transactions are under $10,000
A long-standing customer with a moderate volume of domestic wires begins sending frequent wires to a new foreign counterpart in a jurisdiction your bank classifies as higher risk. What is the most appropriate CDD action?
Update the customer's expected activity profile to reflect the new foreign counterpart and document the rationale, considering whether EDD is now warranted
A potential sanctions match shows an exact name and date of birth match to the OFAC list, but the address on your customer file is in a different country than the one on the list. What should you do next?
Escalate to the sanctions officer or compliance team for potential true hit evaluation
If cash deposits always stay under $10,000, there is no need to evaluate them for structuring.
False
An existing corporate customer rated medium risk adds a new majority owner who resides in a higher risk foreign jurisdiction and contributes a large capital injection. What is the most appropriate AML response?
Perform event-driven enhanced due diligence, including verifying the new owner's identity, beneficial ownership, and source of funds
Your monitoring system identifies customers with frequent cash activity near $10,000. Which behaviors most strongly indicate potential structuring designed to evade CTR reporting? Select all that apply.
Daily cash deposits between $9,000 and $9,900 across several related accounts, all made minutes apart; Three cash deposits of $9,800 each on the same day at different branches for the same customer
You are drafting a SAR narrative for unusual wire activity. Arrange the following narrative elements in the most examiner-friendly order.
Correct order: Summarize the customer profile and expected activity → Describe the alert trigger and unusual activity → Detail the research and data sources reviewed → Analyze why the activity is or is not suspicious → State the SAR filing decision and any ongoing monitoring plans
Your institution detects multiple related accounts that send and receive high-value wire transfers among themselves on the same day, with funds quickly moving offshore and balances returning near zero. There is no clear business rationale. Which typology does this pattern most closely resemble?
Layering of funds through rapid in-and-out transfers among related accounts
You are drafting a SAR for suspected funnel account activity. Which narrative approach best aligns with FinCEN guidance for clear, examiner-ready reporting?
Explain who the customer is, summarize the pattern of activity over time, describe what you reviewed, and connect specific facts to why the activity is suspicious
You are assessing a private investment company for onboarding. Which characteristics would typically drive a higher inherent AML risk rating that may justify EDD and closer monitoring? Select all that apply.
Use of nominee directors and limited transparency into controlling parties; Non-resident beneficial owners located in high risk secrecy jurisdictions; Use of foreign correspondent accounts through nested relationships with other financial institutions
After a detailed investigation of unusual wire transfers, you reasonably conclude that the activity is consistent with the customer's documented trade business and does not meet your institution's SAR criteria. To withstand examiner review of this no-file decision, what is the most appropriate documentation approach?
Write a concise narrative summarizing the customer profile, activity reviewed, sources consulted, and why SAR thresholds were not met

1An examiner-ready customer risk rating should identify specific risk drivers such as products, geographies, delivery channels, expected volumes, and ownership complexity.

True / False

2Customer due diligence (CDD) should establish a baseline of expected activity so that future monitoring can more easily identify unusual behavior.

True / False

3Which customer most clearly warrants enhanced due diligence (EDD) at onboarding under a typical U.S. risk-based AML program?

4A small business customer makes three cash deposits of $4,000 each at different branches on the same business day. The activity matches the stated cash-intensive business profile, and there are no other red flags. Which BSA filing obligation is clearly triggered by the facts provided?

5A Suspicious Activity Report (SAR) must always be filed whenever a Currency Transaction Report (CTR) is filed.

True / False

6Which control is a core element of an effective OFAC sanctions compliance program under U.S. guidance?

7Which factor is least likely to increase an individual customer's AML risk rating in a typical U.S. retail banking context?

8If a sanctions screening alert has a very low match score, it can be closed without reviewing any identifiers such as date of birth or address.

True / False

9You receive an alert for a small manufacturing customer that just sent its first wire transfer to a higher risk foreign country. Before deciding whether the activity is suspicious, what is the most appropriate first element to document in your alert narrative?

10Your sanctions screening system flags a possible match to an OFAC-listed individual for an incoming wire, but the name is common. What is the most appropriate next step before clearing or escalating the alert?

11You review an ACH transaction monitoring alert and determine that the customer's activity matches their stated payroll processing business with no suspicious indicators. Which closure comment is most examiner-ready?

12When closing a transaction monitoring alert with no SAR filing, you should still document what you reviewed and why the activity was not considered suspicious.

True / False

13A cash-intensive business customer begins making alternating cash deposits and withdrawals between $9,500 and $9,900 almost every day, with no clear business need for same-day in-and-out activity. How should this pattern most likely be treated?

14A long-standing customer with a moderate volume of domestic wires begins sending frequent wires to a new foreign counterpart in a jurisdiction your bank classifies as higher risk. What is the most appropriate CDD action?

15A potential sanctions match shows an exact name and date of birth match to the OFAC list, but the address on your customer file is in a different country than the one on the list. What should you do next?

16If cash deposits always stay under $10,000, there is no need to evaluate them for structuring.

True / False

17An existing corporate customer rated medium risk adds a new majority owner who resides in a higher risk foreign jurisdiction and contributes a large capital injection. What is the most appropriate AML response?

18Your monitoring system identifies customers with frequent cash activity near $10,000. Which behaviors most strongly indicate potential structuring designed to evade CTR reporting? Select all that apply.

Select all that apply

19You are drafting a SAR narrative for unusual wire activity. Arrange the following narrative elements in the most examiner-friendly order.

Put in order

1Summarize the customer profile and expected activity

2State the SAR filing decision and any ongoing monitoring plans

3Describe the alert trigger and unusual activity

4Analyze why the activity is or is not suspicious

5Detail the research and data sources reviewed

20Your institution detects multiple related accounts that send and receive high-value wire transfers among themselves on the same day, with funds quickly moving offshore and balances returning near zero. There is no clear business rationale. Which typology does this pattern most closely resemble?

21You are drafting a SAR for suspected funnel account activity. Which narrative approach best aligns with FinCEN guidance for clear, examiner-ready reporting?

22You are assessing a private investment company for onboarding. Which characteristics would typically drive a higher inherent AML risk rating that may justify EDD and closer monitoring? Select all that apply.

Select all that apply

23After a detailed investigation of unusual wire transfers, you reasonably conclude that the activity is consistent with the customer's documented trade business and does not meet your institution's SAR criteria. To withstand examiner review of this no-file decision, what is the most appropriate documentation approach?

Disclaimer

This quiz is for educational purposes only. It does not constitute professional advice. Consult a qualified professional for specific guidance.

Frequent AML Compliance Decision Errors Highlighted in This Quiz

Vague customer risk ratings

Participants often assign low or moderate risk labels without tying them to specific factors. Examiners expect a traceable link to products, services, geographies, channels, ownership, and expected volume. State the drivers, then connect each driver to controls such as EDD steps, monitoring scenarios, or refresh frequency.

Static CDD and beneficial ownership views

Another error is treating CDD and beneficial ownership data as a one-time onboarding task. Quiz scenarios frequently embed triggers that require a refresh. These include new signers, rapid account growth, new foreign counterparties, and abrupt cash usage changes. Failing to recognize these as CDD update points leads to missed questions.

Weak SAR decision reasoning

Many learners focus only on dollar thresholds. They miss intent indicators and behavioral patterns. The quiz expects you to distinguish between activity that is unusual but explainable and activity that supports suspicion, such as repeated structuring patterns, funnel activity, or unexplained rapid in and out movement.

Poor alert closure narratives

Short conclusions such as no suspicious activity without describing the work performed will be scored as incorrect. For each scenario, explain the customer profile, what triggered review, the data you examined, and how that evidence supported either a SAR, a CTR only, or a documented no-file decision.

Superficial sanctions match resolution

Clearing potential OFAC hits based only on name differences is a frequent mistake. The quiz expects identifier-based comparisons. Reference date of birth, address, nationality, document numbers, and ownership, then document why the match was cleared or escalated.

Authoritative References for AML Compliance Practice

Core sources to support AML Compliance Quiz decisions

Use these official resources to calibrate your answers on risk assessment, CDD and EDD, SAR and CTR filing, and OFAC screening.

FFIEC BSA/AML Examination Manual: Primary reference for U.S. examiner expectations on risk assessments, program design, CDD, transaction monitoring, and BSA reporting.
FinCEN SAR FAQs on Suspicious Activity Reporting Requirements: Clarifies structuring analysis, continuing activity reviews, and no-file documentation.
FinCEN SAR Narrative Guidance Package: Practical structure for clear, complete SAR narratives that mirror law enforcement needs.
OFAC Framework for Compliance Commitments: Outlines expectations for sanctions risk assessment, internal controls, and escalation, which support quiz sanctions questions.

AML Compliance Quiz: Focused FAQ for Practitioners

Common questions about this AML Compliance Quiz

Who is the AML Compliance Quiz intended for?

This quiz targets BSA officers, AML investigators, sanctions analysts, internal auditors, and compliance professionals who make day-to-day decisions on CDD, EDD, alert handling, SAR and CTR filing, and sanctions dispositions. It assumes familiarity with U.S. BSA, FFIEC guidance, and basic sanctions concepts.

How closely do the scenarios track U.S. regulatory expectations?

Scenario logic mirrors the structure in the FFIEC BSA/AML Examination Manual and recent FinCEN SAR FAQs. Questions test whether you identify risk drivers, apply appropriate thresholds, and document reasoning in a way an examiner could replay. The goal is alignment with real supervisory reviews, not abstract theory.

What skills will I practice by working through this AML Compliance Quiz?

You will practice translating open-ended fact patterns into concrete actions. Examples include deciding between CDD and EDD, distinguishing CTR obligations from SAR triggers, resolving sanctions alerts using identifiers, and writing short narratives that show what you checked, what you found, and why you reached a particular filing or no-file outcome.

How can I use this quiz for team training and calibration?

Have analysts complete the standard or full mode, then compare not only scores but also the reasoning they used. Discuss which risk factors, typologies, and data sources each person prioritized. This helps standardize escalation thresholds and narrative quality across investigators and business units.

What should I study next to extend beyond this AML Compliance Quiz?

Pair this quiz with the Practice AML CFT Compliance Skills Assessment to broaden coverage into terrorist financing controls and program governance. You can also use the Data Privacy Skills Assessment Practice Quiz to strengthen handling of customer information that appears in alert investigations and SAR narratives.