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Question 362

What reputational risk consequence could a financial entity face for violating AML laws?

  • A. Seizure of assets
  • B. Monetary penalties Most Votes
  • C. Increased audit costs to monitor behavior
  • D. Loss of high-profile customers
Answer:

B


Explanation:
Reference:https://www.ifc.org/wps/wcm/connect/e7e10e94-3cd8-4f4c-b6f8-
1e14ea9eff80/45464_IFC_AML_Report.pdf?MOD=AJPERES&CVID=mKKNshy

User Votes:
A 7 votes
50%
B 55 votes
50%
C 7 votes
50%
D 50 votes
50%
Discussions
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Sorak
1 year, 8 months ago

D is reputational risk B is not

2
AnaA.
1 year, 8 months ago

B. Sanctions pécuniaires

0
Assist.moli
1 year ago

consequence from reputational risk -----> your precious customers go away

1
dionette_tayl
6 months, 1 week ago

D. Loss of high-profile customers

0
alban_999
4 months, 3 weeks ago

Failure to comply with AML regulations, can severely damage its reputation, leading to a loss of trust and confidence among high-profile customers and partners

0
Oluwaseun15
2 months, 4 weeks ago

Monetary penalties

0
trinka5
1 week, 6 days ago

Reputational risk refers to damage to a financial institution's public image, trustworthiness, or brand, which can result from violations of laws, including anti-money laundering (AML) regulations.

D. Loss of high-profile customers ✅
When a financial institution is publicly associated with AML violations, clients—especially reputable or high-profile ones—may sever ties to avoid association with illicit activity. This is a direct consequence of reputational damage.

0