C ​ Importance of AML Training for All Levels of an Institution: Advanced CAMS-Audit and FATF emphasize that AML training programs should be inclusive of all stakeholders, including senior management and board members, as they are integral to establishing an effective AML/CFT compliance culture​​. ​ Board-Level Training Specifics: Directors require tailored AML training to address strategic oversight responsibilities rather than operational controls. Periodic training is mandatory to keep the board updated on regulatory changes and institutional risk profile adjustments. ​ Audit Observation: Exclusion of the board from AML training reflects a gap in the institution’s AML framework, potentially exposing it to regulatory scrutiny. ​ Reference to AML/CFT Standards: FATF Recommendations mandate training for all levels of an institution, explicitly highlighting senior management and governance roles in compliance efforts​​.

D ​ In follow-up strategies, the focus should be on ensuring accountability and tracking progress. Establishing a target completion date and regularly updating the status of remedial actions ensures timely and effective resolution of deficiencies. ​ CAMS-Audit emphasizes tracking timelines and milestones for corrective actions to align with regulatory expectations and internal compliance frameworks​​.

A, C ​ A. Ongoing Due Diligence: FATF Recommendations emphasize the need for ongoing monitoring and due diligence of NPOs to detect and prevent misuse for terrorist financing​​. ​ C. Diversion of Funds: Identifying and mitigating risks of fund diversion to terrorist organizations is a critical component in evaluating NPO vulnerabilities​​.

A ​ KYC integration is fundamental to ensuring that anti-money laundering controls are effective from the outset of client onboarding. Delayed implementation of KYC increases the risk of onboarding high-risk customers without adequate due diligence. ​ Advanced CAMS-Audit documentation stresses the importance of embedding KYC into business processes during product design and rollout phases to mitigate risks​​​. ​ Neglecting this requirement can expose the organization to severe regulatory penalties and reputational damage.

A ​ Purpose of Model Validation: Model validation ensures that the transaction monitoring model is functioning as intended, effectively identifying suspicious transactions and mitigating AML/CFT risks​​. It encompasses testing data accuracy, parameter relevance, threshold efficacy, and compliance with regulatory requirements​​. ​ Process: Validation includes end-to-end reviews, statistical evaluations, and expert assessments of model outputs. According to FATF and Basel Committee standards, model validation is a critical component of the AML framework​​. ​ Irrelevance of Other Options: Audit continuous monitoring focuses on ongoing oversight, not the specific confirmation of initial model functionality. Data validation addresses data quality but does not verify operational model performance. Regulatory approvals are necessary for compliance but are not a step in verifying model functioning.