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

Which factor increases the money laundering risk of a transaction?

1. The transaction is made to a common and popular retailer.

2. The transaction is the first time the customer has made a payment to this company.

3. The transaction is a payment to tax authorities.

4. The transaction is made to an account in the original account owner's name.

The correct answer is: The transaction is the first time the customer has made a payment to this company.

The selection of a transaction being the first time a customer has made a payment to a company indicates a higher money laundering risk due to the lack of established trust and history between the customer and the business. When a payment is made for the first time, it raises alarms as it could suggest an attempt to introduce illicit funds into the financial system. In scenarios where a customer has not previously engaged with a business, that transaction may lack the usual indicators of legitimate activity such as a consistent pattern of purchasing goods or services. Financial institutions assess risk by examining customer behavior, and a first-time transaction often does not fit into predictable patterns, making it a red flag for potential money laundering activities. On the other hand, transactions made to a common retailer, payments to tax authorities, or payments made to accounts in the original owner's name typically exhibit characteristics of legitimacy and established financial behaviors, which serve to mitigate the perceived risk of money laundering.