Module: General Practice
Q82: Which of the following statements accurately describe the mechanics of Trade-Based Money Laundering (TBML) and its specific techniques?
TBML is defined by the FATF as the process of disguising the proceeds of crime and moving value through the use of trade transactions, rather than just moving financial funds.
"Under-invoicing" allows an exporter to transfer value to an importer by shipping goods worth more than the invoiced amount, effectively allowing the importer to receive extra value.
"Phantom Shipments" involve the invoicing and payment for goods that are never actually shipped, serving solely as a method to move money between jurisdictions.
Unlike cash smuggling, TBML is generally easier to detect because customs data is always synchronized with banking transaction data in real-time.
"Under-invoicing" allows an exporter to transfer value to an importer by shipping goods worth more than the invoiced amount, effectively allowing the importer to receive extra value.
"Phantom Shipments" involve the invoicing and payment for goods that are never actually shipped, serving solely as a method to move money between jurisdictions.
Unlike cash smuggling, TBML is generally easier to detect because customs data is always synchronized with banking transaction data in real-time.
✅ Correct Answer: B
The correct answer is Option B. TBML moves value via trade.
Under-invoicing transfers value to the importer.
Phantom shipments move money without goods.
TBML is hard to detect, making statement 4 incorrect.
TBML techniques are advanced topics in the IIBF AML KYC Exam 2026.
Under-invoicing transfers value to the importer.
Phantom shipments move money without goods.
TBML is hard to detect, making statement 4 incorrect.
TBML techniques are advanced topics in the IIBF AML KYC Exam 2026.