1. How many Key Elements of KYC Policy of Banks are present? a.

Two
b. Four c. Six d. Eight

2. Which of the following information should be gathered by banks to understand the nature of the business of the
Correspondent Bank? a. Major Business Activities b. Level of AML/KYC compliance c. Purpose of opening the account d. All of the above

3. Corresponding Banks should refuse to enter into a correspondent relationship with a Shell bank
a. True b. False 4. The objectives of the KYC guidelines is to allow the bank from being used by criminal elements for money laundering activities a. True b. False 5. KYC means a. Know Your Customers well b. Know Your existing customers c. know your prospective customers d. Satisfy yourselves about the customers identity and activities 6. Sec 131 of NI act, 1881 extends protection to a. Paying Banker b. Collecting banker c. Advising Banker d. Issuing Banker

7. Change of Risk category under KYC can be considered in not less than __ years in case of low risk customers
and not less than __ years in case of medium / high risk customers. a. 2,2 b. 5,5 c. 5,2 d. 2,5 8. Under KYC, which of the following documents can be accepted as a documents of proof name, address and activity of proprietary concern a. Sales tax registration certificate b. Service tax registration certificate c. Professional tax registration certificate d. Any of these 9. What is the cut-off point amount of a cash transaction, under KYC that requires to be reported: a. Up to Rs 10 lakhs b. Rs 10 Lakh c. Above Rs 10 lakh d. Rs 20 laks and above 10. KYC guidelines have been issued by RBI under provisions of: a. Section 21 of BR Act b. Section 35 of BR Act c. Section 35 A of RBI Act d. None of the above

11. CTR- monthly reporting to FIU-IND by the Corporate office with in ________Days. a. 10 b. 15 c. 20 d. Month end 12. Which one of the following best explains the term "Shell Bank"? a. A Bank, which is incorporated in a country where it has no physical presence. b. A bank which is incorporated to take deposits only and invests in 100% secured Govt securities only. These banks normally charge huge service charges from their depositors to earn profits. These types of banks are normally in Switezerland & other small European countries. c. A bank which is having 100% of its branches in a country in which it has been incorporated i.e. no foreign branch. d. A bank incorporated in Islamic country on the, principles of Islamic Banking. e. None of the above. 13. A Pakistani national of Indian origin wishes to open NRI account: What decision you would take? a. Decline his request because he is not considered a NRI b. Open the account because he is not a resident of India c. Collect his necessary documents and seek RBI's permission d. Seek head office approval

14. In case of receipt of Counterfeit currency Note from a customer the action of the bank should be____?
a. To tear the Note in small pieces b. To impound the Note & issue receipt to the customer duly signed by Manager, Cashier & customer c. To impound the Note & issue receipt to the customer duly signed by Cashier & customer only d. To hand over the customer to the police. e. None of the above.

15. As per RBI Anti-Money laundering guidelines, the Ordering Bank and Intermediary Bank in case of Wire Transfers
have to preserve the originating information for at least _____years: a. 10 b. 5 c. 21 d. 12 16. Financial Intelligence Unit (FIU) is maintained by _______: a. RBI b. CBI c. Each bank's HO d. Ministry of Finance

17. Which one of the following is not correct with regard to quoting of PAN number for banking transactions?
a. Opening of an account with banking company in cash b. Single time deposit receipt exceeding Rs 50000/- with a bank in cash, c. On application for issue of DD/MT etc for cash, if amount is Rs 50000 or more. d. For making deposit under Tax Saver Scheme, irrespective of the amount. e. None of the above. 18. Failure of internal process is categorized under which type of Risk? a. Internal Risk b. Operational Risk c. Process Risk d. Credit Risk e. Normal Banking-Risk

19. A saving bank account is treated as a dormant account if there is no operation in it for the last...years:
a. One

b. Two c. Three d. 6 months Answer: (A)

20. Under KYC guidelines, what is the amount up to which the bank drafts or cash orders can be issued by the banks
for cash? a. Rs.20000 b. 30000 c. 50000 d. 75000

21. For the purpose of KYC policy of RBI, who among the following cannot be considered a Customer?
a. a person or entity that maintains an account and/or has a business relationship with the bank; b. one on whose behalf the account is maintained (i.e. the beneficial owner); c. beneficiaries of transactions conducted by professional intermediaries, such as Stock Brokers, Chartered Accountants, Solicitors etc. as permitted under the law, d. none of the above 22. Preservation of bank records is mandatory under which of the following Acts? a. RBI Act 1934 b. Preservation of Books Act 1902 c. Indian Evidence Act d. Banking Regulation Act 1949

23. A private limited company ABC Pvt Ltd wants to open a current account with your branch. Which of the following
are not required to be obtained from the company: a. Memorandum & Articles of Association b. Resolution of Board of Directors & Certificate of incorporation c. Certificate of Incorporation d. Introduction as required under KYC guidelines Answer: (C)

24. Ravi your customer of a saving bank account is approached by a person called Ram to give an introduction to
enable him to open a saving bank account with your branch to which he agrees. Subsequently it is proved that Ravi gave introduction though he really did not know much about Ram. In such situation: a. Bank can hold Ravi responsible as he carelessly gave the introduction b. Bank cannot hold Ravi responsible as Ravi has not violated introduction rules c. Bank can recover 50% of amount from Ravi d. any of the above e. None of the above Ans (b) 25. Which of the following documents in case of a company, is called Charter of the company: a. Resolution from Board of Directors or Shareholders b. Memorandum of Association c. Articles of Association d. Certificate of Incorporation e. Certificate of Commencement of Business Ans (b)

26. A company has been formed to undertake the business of software development. This objective of the company
would be found in which of the following documents: a. Certificate of Incorporation b. Certificate of Commencement of Business c. Resolution from Board of Directors d. Articles of Association e. None of the above

27. You are approached by a person for opening an account in the name of an executor of a will. You require which of
the following documents: a. Registration certificate b. Memorandum of association and articles of association, c. Probate d. letter of administration e. None of the above.

28. Which of the following is not correct with regard to prevention of Money Laundering provisions:
a. it is acquiring, owning, possessing or transferring any proceeds of money of crime b. it is a process of converting money obtained illegally to appear to have originated legitimate sources c. India has passed the Prevention of Money Laundering Act to identify and control the transactions of money laundering d. Records relating to money laundering transactions are to be preserved by banks for 20 years e. Offences under money laundering are cognizable and non-bailable.

29. 81 In deposit accounts, the photographs are obtained. Why?

a. b. c. d. e. to avoid frauds to avoid irregularities to detect irregularities in financial transactions to comply with UN directives to check benami accounts / transactions

30. Under Know Your Customer guidelines of RBI, for which period the records are required to be maintained:
a. b. c. d. e. 1 years 2 years 4 years 5 years 10 years

31. What is the time period prescribed by RBI for preservation of records under Prevention of Money Laundering and
what is the time period during which suspicious transaction report is to be sent within, days of detection: a. 2 years, 15 days b. 4 years, 12 days c. 5 years, 10 days d. 10 years, 7 day e. 12 years, 7 days 32. KYC record to be maintained for transactions of : a. Rs.10 lac only in cash b. Rs.10 lac only in cash or transfer c. more than Rs.10 lac in cash or transfer only d. Rs.10 lac or above in cash

33. Know Your Customer (KYC) guidelines have been issued to check anti-money laundering activities. The
guidelines have been issued by _______under__________. a. RBI: Sec 35 (a) of RBI act b. RBI: Sec 35(a) of Banking Regulation Act c. IBA: Sec 35(a) of Banking Regulation Act d. GOI Under Anti Money Laundering Act e. None of the above.

34. A report of transactions of Rs 10 lacs and above is submitted to higher office. The periodicity of the report is:
a. b. c. d. Weekly Fortnightly Monthly Quarterly

e. None of the above.

35. RBI has simplified KYC procedure for opening accounts for those persons who intend to keep balances not
exceeding Rs.____________ in all their accounts taken together and total credit in all the accounts taken together is not expected to exceed Rs. ___________lac in a year. a. 50,000, 1,00,000 b. 1,00,000, 5,00,000 c. 5Iac,10Iac d. 5 lac, 151ac 36. In duly introduced account, the account holder has committed fraud. What is the liability of introducer? a. Introducer has to pay the amount to the bank. b. Liability of introducer is co-terminus with. that of the account holder. FIR will also be lodged against him. c. Introducer establishes identity of the customer only. If the identity is OK, he is not liable to the loss occurred to the bank. d. Introducer establishes identity of the customer to the best of his knowledge. If his intentions are not fraudulent and the customer turns out to be fictitious person, the introducer can not be held liable e. None of the above. 37. KYC guidelines have been issued by whom and under which act? RBI under Section 35 A of BR act. 38. For non-compliance of KYC Bank may attract penalties under which Act? BR Act. 39. Under KYC guidelines the account of introducer should be atleast how many month old? Six months old

40. Under KYC guidelines reporting / monitoring is compulsory for the transaction of Rs?
10 lakhs and above 41. Customer is defined under which act? KYC norms 42. What is the document required to opened the a/c of joint stock co. MOA, Cert. of incorporation, Board Resolution 43. What is the man objective of KYC norms? To ensure banking channels are not used to convert illegal funds into legal funds

44. Transaction in a newly operated accounts are to be kept under close watch at least for a period of?
3 months

45. KYC guidelines take into account the recommendations of an International Financial Action Task Force (FATF) a)
on anti money laundering standards b) on combating financing of terrorism c) on manipulation of Economic indicators a. a and b only b. b and c only c. a and c only d. a to c all 46. Demand Draft can be issued against payment in cash for an amount up to: a. Rs 1 lac b. Rs 50000 only c. Less than Rs 50000 d. Rs 20000 only 47. KYC guidelines have been issued by RBI with the objective of:

a. Stopping occurring of frauds in banks b. Prevent use of banks for unaccounted for money c. Prevent use of banks for money laundering processes d. To have control over money laundering 48. The USA PATRIOT Act was passed in: a. 1970 b. 1985 c. 2001 d. 2007 49. The three stages of money laundering are: a. Layering, Placement, Refining b. Placement, Refining, Integration c. Refining. Integration, Layering d. Integration, Layering, Placement 50. In determining what risks a customer poses, which consideration should NOT be a major factor? a. b. c. d. Where the customer resides or where the business is headquartered. What is the size of your financial institution. What occupation or type of business does the customer derive their income from. What are the customers ethnic heritage, sexual orientation and political beliefs.

51. A number of recommendations have been made by whom? a. Financial Action Task Field b. Financial Aging Terror Fund c. Financial Action Task Force d. Financial Laundering Task Force

52. Under FATF guidelines companies have a duty of care called what?
a. b. c. d. Know Your Customer Monitor Customers manually Customer Due Care Customer Due Diligence

53. If I see something that looks suspicious what should I do?

a. Say nothing and hope that it will go away b. Inform your Supervisor or Manager c. Inform the MLRO immediately d. Contact the Police 54. What does PEP stand for? a. Potential Ex - Convicted Person b. Politically Engaged Person c. Politically Exposed Person d. Poorly Explained Potential 55. Risk arising from failure of computer system and loss of data is: a. credit risk b. system risk c. liquidity risk d. operational risk e. computer risk