CFE – Investigation — Question 33

Due to risks of illicit transactions, most jurisdictions require financial institutions to obtain information about which of the following from an institution with which they have a foreign correspondent relationship?

Answer options

• A. The institution’s client loan profiles
• B. The institution’s investment portfolio
• C. The institution’s ownership details
• D. The institution’s tax statement

Correct answer: C

Explanation

The correct answer is C because understanding the ownership details of a foreign correspondent institution is crucial for assessing the risk of illicit activities. Options A, B, and D do not provide necessary insights into the risk factors associated with ownership, which is critical for compliance and due diligence in financial transactions.