According to the FATF Recommendations, the international standard for anti-money laundering and counter-terrorist financing, beneficial owners are the natural persons who ultimately own or control a customer or the natural persons on whose behalf a transaction is being conducted1 The beneficial ownership criterion is not based on the legal title or the nominal ownership of the funds, but on the effective control or the ultimate entitlement to the funds. Therefore, having signature authority over the account, being the person in whose name an account is opened, or being a trusted party in a correspondent banking relationship are not sufficient to determine the beneficial ownership of funds. These may be indicators of legal ownership or nominee arrangements, but they do not necessarily reflect the true ownership or control of the funds. The most effective criterion for determining the beneficial ownership of funds is having control over such funds or entitlement to such funds, either directly or indirectly, through ownership, voting rights, contractual agreements, trusts, or other means2345 References:
1: FATF Recommendations, 2012, Recommendation 10 and Interpretive Note
2: Beneficial Ownership Meaning and Regulation, Investopedia, 2022
3: Ultimate Beneficial Ownership: Understanding Where The Money Comes From, ComplyAdvantage,
2022
4: Beneficial ownership and Irish investment funds, A&L Goodbody, 2021
5: Asset Management and Investment Funds Legal and Regulatory Update, Arthur Cox, 2020

According to the Bank Secrecy Act (BSA), a financial institution or business must establish an anti-money laundering (AML) program that includes at least four elements: (a) a system of internal policies, procedures and controls to prevent, detect and report money laundering and other illicit activities; (b) a designated compliance officer who is responsible for overseeing the implementation and effectiveness of the AML program; an ongoing employee training program that covers the legal and regulatory obligations, the risks and red flags of money laundering, and the roles and responsibilities of the staff in the AML program; and (d) an independent audit function that tests and evaluates the adequacy and compliance of the AML program12.
While the Office of Foreign Assets Control (OFAC) is a key agency that enforces economic and trade sanctions against targeted foreign countries, entities and individuals, it is not part of the BSA or the AML program requirements. However, financial institutions and businesses are expected to comply with OFAC regulations and screen their customers and transactions against the OFAC lists of sanctioned parties. Failure to do so may result in civil or criminal penalties34. Therefore, it is advisable for financial institutions and businesses to have an OFAC program that is integrated with their AML program, but it is not a mandatory element that they have to specifically address in their AML program.
References:
1: Financial Crimes Enforcement Network (2020). Anti-Money Laundering Programs
2: ACAMS (2020). CAMS Certification Package (6th Edition)
3: Office of Foreign Assets Control (2023). Sanctions Programs and Country Information
4: Moses & Singer LLP (2023). Anti-Money Laundering, Bank Secrecy and OFAC Regulations

According to the Anti-Money Laundering Specialist (the 6th edition) resources, electronic funds transfers (EFTs) are transactions that involve the movement of funds electronically from one account to another, either within the same financial institution or across different institutions, domestically or internationally1. EFTs can be used for legitimate purposes, such as facilitating trade, commerce, and remittances, but they can also be exploited by money launderers to conceal the origin, ownership, and destination of illicit funds2. Some of the indicators of money laundering associated with using EFTs are:
Funds transfers to or from a financial secrecy haven without an apparent business reason. Financial secrecy havens are jurisdictions that offer a high degree of banking secrecy, low or no taxes, lax regulation and supervision, and weak or non-existent anti-money laundering and counter-terrorist financing (AML/CTF) measures3. Money launderers may use these havens to hide their illicit funds, evade taxes, and avoid scrutiny from authorities. Funds transfers to or from these havens without a clear or plausible explanation may indicate an attempt to launder money or finance terrorism.
Funds transfers are received or sent from the same person to or from different accounts. This may indicate a layering technique, which is the process of moving funds through multiple accounts, institutions, or jurisdictions to obscure the audit trail and the source and ownership of the funds4. Money launderers may use this technique to avoid detection, reporting, or freezing of their funds by authorities or financial institutions.
Payment or receipts with no apparent link to legitimate contracts, goods or services. This may indicate a trade-based money laundering technique, which is the process of using trade transactions to disguise the movement of illicit funds, either by over- or under-invoicing, misrepresenting the quantity or quality of goods, or falsifying documents. Money launderers may use this technique to transfer value across borders, evade taxes or customs duties, or justify the movement of funds that have no legitimate origin or purpose.
The other option is incorrect because:
Regular and frequent transfers from the account of a large company said to be payment for goods bought on credit is not necessarily an indicator of money laundering associated with using EFTs. This may be a normal business practice for some companies that have a high volume of transactions or a long-term relationship with their suppliers or customers. However, this may also be a red flag if the company is not well-known, has no physical presence, has no apparent business activity, or is located in a high-risk jurisdiction. Therefore, this option requires further investigation and verification before concluding that it is an indicator of money laundering.
References:
1: ACAMS, CAMS Study Guide, 6th Edition, Chapter 5, p. 104 2: ACAMS, CAMS Study Guide, 6th Edition, Chapter 5, p. 105 3: ACAMS, CAMS Study Guide, 6th Edition, Chapter 5, p. 107 4: ACAMS, CAMS Study Guide, 6th Edition, Chapter 5, p. 106 : ACAMS, CAMS Study Guide, 6th Edition, Chapter 5, p. 108

Implementing a sound customer due diligence (CDD) program is the most effective way to prevent money laundering through financial institutions, according to experts. CDD is the process of identifying and verifying the identity of customers and assessing their risk profile, source of funds, and expected activity. CDD helps financial institutions to detect and prevent money laundering by enabling them to know their customers, monitor their transactions, and report any suspicious or unusual behavior. CDD is also a key requirement of the international standards and best practices for anti-money laundering and combating the financing of terrorism (AML/CFT), such as the Financial Action Task Force (FATF) Recommendations and the Basel Committee on Banking Supervision (BCBS) Guidelines.
The other options are not as effective as CDD, as they are either too narrow or too broad in scope. Ensuring that transaction monitoring systems can identify terrorist financing is important, but it does not address the broader issue of money laundering, which may involve other types of criminal proceeds or activities.
Collecting information on beneficial owners and foreign customers is a part of CDD, but it is not sufficient by itself, as it does not cover the risk assessment and ongoing monitoring aspects of CDD. Instituting a policy prohibiting the acceptance of funds intended for terrorist financing is a good practice, but it is not a preventive measure, as it relies on the assumption that the funds are already identified as such, which may not be the case.
References:
Customer Due Diligence - FATF-GAFI.ORG
Sound management of risks related to money laundering and financing of terrorism - Bank for International Settlements CAMS Study Guide 6th Edition, page 36-37.

The scenario described in the question presents several indicators of potential money laundering through real estate, which the broker should be aware of and report accordingly. The most relevant red flags are:
Value: The student wants to buy a home that is overvalued, meaning that the asking price is higher than the market value or the appraisal value of the property. This could indicate that the student is trying to launder a large amount of illicit funds in one transaction, or that the seller is colluding with the student to inflate the price and receive a kickback. Overvaluing or undervaluing properties is a common technique used by money launderers to manipulate the price of real estate and conceal the source or destination of their funds12.
Inconsistency: The student's behavior and profile are inconsistent with the typical characteristics of a legitimate home buyer. The student cancels the viewing of the home at the last minute due to illness, which could suggest a lack of interest or a pretext to avoid scrutiny. The student also wants to buy an expensive home despite being a student, which could indicate a discrepancy between the student's income and the source of funds. Moreover, the student disregards the broker's objections to the asking price, which could imply that the student is not concerned about the value or quality of the property, but rather the amount of money that can be laundered through it34.
Transaction speed: The student wants to quickly buy the home, which could indicate a sense of urgency or pressure to move the illicit funds before they are detected or seized by the authorities. Money launderers often use fast transactions to avoid raising suspicion or leaving a paper trail. Transaction speed is especially relevant when combined with other red flags, such as cash payments, anonymous buyers, or overvalued properties5 .
References:
Understanding Money Laundering in Real Estate
RED FLAG INDICATORS FOR REAL ESTATE SECTOR
Investigating Money Laundering through Real Estate
AML Red Flags Associated with Real Estate Sector Businesses
FinCEN Proposes Rule to Combat Money Laundering and Promote Transparency in Residential Real Estate
[ACAMS Study Guide, 6th Edition, Chapter 7, pp. 200-201]