An independent RES exam study resource — not a Government website and not affiliated with the Council for Estate Agencies (CEA).Find My OrderHow to identify official CEA sources
Browse Papers
Home / Free RES questions / AML CFT

Paper 2 · Lesson 1 — Regulatory Framework, Registration, CPD and Professional Conduct

AML CFT

The AML/CFT framework, CDD/ECDD, STR and tipping off, the HDB-rental exemption, per-contravention penalties, retention, internal controls, the unrepresented counterparty.

2 questionsAnswers & explanations includedFree — no sign-up

Question 1

Ms Naidu is tempted to tell Mr Lau the agency may have to report him; Mr Quek warns her against it.

  1. (i) Ms Naidu reports her suspicion to the agency first, and the agency files the suspicious transaction report through its official channel.
  2. (ii) If Mr Lau abandons the purchase before completion, the duty to report any suspicion falls away.
  3. (iii) Telling Mr Lau the agency may have to report him would amount to tipping off, a criminal offence.
  4. (iv) Suspicion alone is enough to trigger the reporting duty, even without proof of wrongdoing.
  1. A. (i), (iii) and (iv) only
  2. B. (i), (ii), (iii) and (iv)
  3. C. (iii) and (iv) only
  4. D. (i) and (iv) only
Show the answer and full explanation

Answer: A

The rule. The salesperson reports her suspicion to the agency, which files the suspicious transaction report through its official channel. The duty is triggered by suspicion alone and is absolute — it survives even if the deal collapses. Warning the client is tipping off, a criminal offence.

Why A is correct. (i) reporting through the agency, (iii) tipping off as a criminal offence, and (iv) suspicion alone triggering the duty are correct. (ii) is false — the duty does not fall away if Mr Lau abandons the purchase.

The other options.

  • B adds the false (ii), the duty lapsing on abandonment.
  • C drops the reporting-channel point at (i).
  • D drops the tipping-off point at (iii).

Exam note. Suspicion alone triggers an absolute duty; abandoning the deal does not end it, and warning the client is a crime.

Warning the client is tipping off, a criminal offence →

Question 2

Mr Quek is both Greenview's KEO and its Compliance Officer. Which statement correctly describes the agency's AML internal controls?

  1. A. As a 26-salesperson agency, Greenview is too small to need documented internal controls.
  2. B. The KEO cannot also be the compliance officer; the two roles must be held by different people.
  3. C. Records of its AML controls need be kept for a minimum of only two years, not five.
  4. D. Greenview must keep documented controls, a compliance officer, and five-year records.
Show the answer and full explanation

Answer: D

The rule. Every estate agent must keep documented internal AML controls, appoint a compliance officer, and retain records for at least five years. The KEO may be the compliance officer — indeed for a sole proprietor the KEO must be.

Why D is correct. Greenview must maintain documented controls, a compliance officer, and five-year record retention.

The other options.

  • A exempts a "small" agency; size does not remove the controls obligation.
  • B says the KEO cannot be the compliance officer; the roles may be held by one person.
  • C understates retention at two years; the minimum is five.

Exam note. Documented controls, a compliance officer, five-year records — for every agency, whatever its size.

The KEO may be the compliance officer →

Practise it under exam conditions

Single questions test whether you know a rule. The paper tests whether you can find it in a scenario, at speed, with three plausible alternatives in the way. Start with the free 20-question half-paper.

Free 20-question paperThe papers in PDF

Looking for past-year papers? CEA doesn't publish them — here's what it does publish.

Independent study material. Not affiliated with or endorsed by the Council for Estate Agencies. No pass guarantee — for study use only.