JAIIB · PPB

KYC AML CFT NORMS

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Principles and Practices of Banking — JAIIB.

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Q

What does KYC stand for in banking?

A

KYC stands for Know Your Customer. It is a process by which banks verify the identity and address of their customers before and during account opening.

Q

What is the full form of PMLA in Indian banking?

A

Prevention of Money Laundering Act, 2002

Q

What is the primary objective of KYC norms?

A

The primary objective of KYC norms is to prevent banks from being used, intentionally or unintentionally, for money laundering and terrorist financing activities.

Q

Which authority in India issues guidelines on KYC norms to banks?

A

Reserve Bank of India (RBI)

Q

Which RBI Master Direction governs KYC norms for banks in India?

A

The RBI Master Direction on Know Your Customer (KYC) Direction, 2016 (updated periodically) governs KYC norms for banks and regulated entities in India.

Q

What is 'placement' in the money laundering process?

A

First stage where illegal cash is introduced into financial system

Q

What does AML stand for?

A

AML stands for Anti-Money Laundering. It refers to a set of laws, regulations, and procedures aimed at preventing criminals from disguising illegally obtained funds as legitimate income.

Q

What is 'layering' in the context of money laundering?

A

Second stage involving complex transactions to disguise illegal funds

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