LEA Contact Regarding Client: Best Actions for Financial Institutions | CAMS Exam Guide
Question
The law enforcement agency (LEA) of a foreign jurisdiction contacts a financial institution (FI) regarding one of the FI's clients. The LEA advises that the client is currently wanted for prosecution as a result of a series of human trafficking charges. What should the FI do? (Choose two.)
Answers
Explanations
Click on the arrows to vote for the correct answer
A. B. C. D. E.BC
Option A is not necessarily the appropriate course of action for the financial institution (FI) to take when contacted by a foreign law enforcement agency (LEA). Before providing any information or cooperating with the foreign LEA, the FI must determine whether such cooperation would violate any laws or regulations, including those related to data protection and privacy.
Option B is a good course of action to take. The FI should inform the local law enforcement agency (LEA) and regulator of the request for awareness, as this can help to ensure that the request is legitimate and can be lawfully fulfilled. This will also allow the FI to seek guidance on how best to proceed.
Option C is also a good course of action to take. The FI should review the client's activity to determine whether any suspicious activity exists, and report it accordingly. This may include filing a Suspicious Activity Report (SAR) with the relevant authorities.
Option D is not a recommended course of action for the FI to take. It is not the role of the FI to advise law enforcement agencies on extradition matters. Instead, the FI should focus on determining the appropriate course of action in relation to the request for information.
Option E is not a recommended course of action for the FI to take. Closing the client's accounts immediately could be viewed as tipping off the client, which is a criminal offence in many jurisdictions. The FI should follow its normal procedures for closing accounts, which should include considering whether there are any suspicious transactions that need to be reported to the relevant authorities.
In summary, the appropriate course of action for the FI to take when contacted by a foreign LEA regarding a client who is wanted for prosecution on human trafficking charges is to inform the local LEA and regulator of the request, review the client's activity for suspicious transactions, and report them accordingly. The FI should also seek guidance from its legal and compliance teams to ensure that any cooperation with the foreign LEA is lawful and appropriate.
