CMFAS RES5 AML / CFT question: suspicion of money laundering and reasonably believes

CMFAS RES5AML / CFT

A financial adviser forms a suspicion of money laundering and reasonably believes that continuing a CDD step would tip off the customer. Under the Notice it may:

A Complete the CDD step anyway, and note the suspicion on the customer's file
B Stop that CDD measure, document the basis for its assessment, and file an STR
C Tell the customer an STR will be filed, so the customer can explain the funds first
D Take no action until the suspicion is confirmed by a completed transaction

Show the answer and explanation

Answer: B. Stop that CDD measure, document the basis for its assessment, and file an STR

Where performing a CDD measure would tip off the customer (or connected persons/BO), the FA may stop performing that measure, document the basis for its assessment, and file an STR. Warning the customer, or telling them a report will be filed, risks committing the tipping-off offence under s48 CDSA.

Common mistake

To avoid tipping-off, the FA halts the measure and reports — it never alerts the customer.

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Original study material mapped to the public CMFAS RES5 syllabus. Unofficial, not endorsed by MAS or SCI. Verify figures and rules against current guidance before relying on them.