Financial Conduct Authority (FCA) UK Regulation Sample Exam

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Which statement about suspected money laundering transactions is TRUE?

All suspected transactions must be reported immediately
Failure to report suspicious transactions is itself a criminal offence
Suspicion must be based on confirmed evidence
Only accountants are required to report suspicious transactions

The correct answer is: Failure to report suspicious transactions is itself a criminal offence

The statement regarding failing to report suspicious transactions being a criminal offence is accurate. Under the Proceeds of Crime Act (POCA) 2002, individuals and businesses that are regulated must report any knowledge or suspicion of money laundering activities to the relevant authorities, typically through a Suspicious Activity Report (SAR). Failing to do so could lead to prosecution, highlighting the seriousness with which such suspicions are treated within the regulatory framework. This responsibility extends to various sectors beyond just accountants, which is why the other statements are not true. For instance, the requirement to report is not limited to all suspected transactions being reported immediately, as there are specific guidelines and time frames for reporting. Suspicion does not need to be based on confirmed evidence; rather, it can arise from reasonable grounds or indications that something may be amiss. Therefore, it is essential for anyone working in regulated sectors to familiarize themselves with these obligations to ensure compliance with the law.