Cryptoasset Anti-Financial Crime Specialist (CCAS) Certification Practice Test

What aspect of a VASP's operations should be reviewed to assess its AML compliance?

1. Quality of customer service

2. Frequency of transactions processed

3. Evidence of KYC checks and AML policy

4. Presence of external partnerships

The correct answer is: Evidence of KYC checks and AML policy

To evaluate a Virtual Asset Service Provider's (VASP) compliance with Anti-Money Laundering (AML) regulations, a comprehensive review of the evidence demonstrating Know Your Customer (KYC) checks and the effectiveness of the AML policy is essential. This includes assessing the procedures the VASP has established to identify and verify the identities of its customers, ensuring that they are conducting thorough due diligence. KYC checks form a critical part of the AML framework because they help institutions mitigate the risks associated with money laundering and other financial crimes. By implementing robust KYC processes, a VASP can collect and document customer information, assess the risk levels of their customers, and monitor transactions for suspicious activities. Furthermore, evaluating the AML policy provides insight into how a VASP addresses compliance obligations, provides employee training, and establishes reporting mechanisms for suspicious activities. The other options, while relevant to the overall operation of a VASP, do not directly assess AML compliance. The quality of customer service, for example, is important for overall business reputation and customer satisfaction but does not indicate how well the VASP manages risks related to money laundering. The frequency of transactions processed could indicate business volume but fails to account for the potential risks associated with those transactions without proper KYC and AML