Exam Prep Q&As Flashcards
(90 cards)
1
Q
Which of the following is not an objective of economic sanctions?
A. To deny resources to targets of sanctions
B. To send a political message
C. To provide the sanctioning country’s industries with a competitive advantage
A
C. To provide the sanctioning country’s industries with a competitive advantage
2
Q
Sanctions that the United States may impose against non- U.S. parties for failure to comply with U.S. Sanctions are called
A. Secondary sanctions
B. Direct Sanctions
C. Sectoral sanctions
A
A. Secondary sanctions
3
Q
Council Decision 2013/798/CFSP – Concerning restrictive measure against the Central African Republic: What type of prohibition is this?
A. Export Restriction
B. Import Prohibition
C. Arms Embargo
A
C. Arms Embargo
4
Q
What is the effect of blocking on property owned or controlled by a sanctions target?
A. It is seized by OFAC and used to reduce the deficit
B. It may not be transferred, paid, exported, withdrawn or otherwise dealt in without authorization from OFAC
C. It is frozen and does not earn interest until the sanctions are lifted
A
B. It may not be transferred, paid, exported, withdrawn or otherwise dealt in without authorization from OFAC
5
Q
Why would a policy maker opt for sectoral sanctions rather than blocking or asset freeze prohibitions?
A
The idea is that they are targeted. The goal is to convince them to stop the behavior, to make it harder to transact without having to asset freeze and make it hard/disrupt the world economy (e.g. Russia/Ukraine War)
6
Q
UN Security Council Resolution 2441 from the control panel: Answer the following questions:
A. What UN Sanctions regime does this UNSC Apply to?
B. Where does the preamble end?
C. What does this Resolution do? Any new measures?
D. Who should comply?
A
A. Libya
B. Starts when you see “Acting” under….
C. No new measures, the resolution does nothing new.
It simply “Urges”, “Reaffirms”, & “Calls” member states to do more of the same.
D. Libya
7
Q
The United Nations imposes sanctions:
A. Against individuals, entities, and countries
B. Against individuals and entities only
C. Against countries only
A
A. Against individuals, entities, and countries
8
Q
Which body manages a sanctions regime adopted by the UNSC and typically publishes names to be placed on the UN Consolidated list?
A. Political Affairs Office
B. Security Council Committee
C. Panel of Experts
A
B. Security Council Committee
9
Q
Which body reviews requests regarding removal from the ISIL (Da’esh) and Al-Qaida Sanctions UN List
A. Security Council Committee
B. Special Focal Point for Delisting
C. Office of the Ombudsman
A
C. Office of the Ombudsman
10
Q
Under the EU sanctions regime, sanctions are imposed by
A. The EU Court Commission
B. The EU Council
C. The EU Parliament
A
B. The EU Council
11
Q
What are the EU sanctions programs based upon?
A. UNSC resolutions, US sanctions and EU amendments to UNSC sanctions
B. UNSC resolutions only
C. UNSC resolutions/EU own initiatives
A
C. UNSC resolutions/EU own initiatives
12
Q
A new sanctions program against country Z is being
proposed within the EU. After a positive decision, the sanctions are implemented in the EU, and names of persons, entities and bodies are published. EU Financial Institutions (FI’s) instantly receive hits against the names.
- What could be the origin of these sanctions?
- Which EU body will have to decide positively to impose the sanctions?
- Who will implement the sanctions?
- Who provides exemptions to the EU sanctions for listed persons, entities and/or bodies?
- What should FI’s do when they notice circumvention?
A
- Either from the UN or they are autonomous sanctions - Proposed by the High Representative (HR) or the HR + Commission
- The EU Council
- Member States Locally
- Competent Authority of the relevant Member States
- Report to the Local Competent Authority of the Member States.
13
Q
Which of the following best describes the concept of freezing of economic resources under EU Sanctions?
A. Preventing their use to obtain funds, goods or services, and preventing the entry of the targeted individual into any EU financial institution.
B. Prohibiting investment by nationals of a target country in designated sectors of the EU economy
C. Preventing their use to obtain funds, goods or services in any way, including, but not limited to, by selling, hiring or mortgaging them.
A
C. Preventing their use to obtain funds, goods, or services in any way, including, but not limited to, by selling, hiring, or mortgaging them.
14
Q
Countering America’s Adversaries Through Sanctions Act (CAATSA) is an example of a
A. Statute enacted by Congress
B. Executive Order issued by the President
C. Sanctions regulations issued by OFAC
A
A. Statute enacted by Congress
15
Q
What is found in Title 31 of the Code of Federal Regulations at Chapter V, Part 500 to end?
A. Executive Orders imposing sanctions
B. Sanctions regulations
C. Sanctions laws
A
B. Sanctions regulations
16
Q
Which department in OFAC does the enforcement of sanctions for the regulated industry?
A. Enforcement
B. Compliance
C. Targeting
A
B. Compliance
17
Q
Which of the following best describes secondary sanctions?
A. Requirements on Non US parties that have no contact with the US
B. Requirements on Non US parties that have a nexus with the US
C. Requirements on US parties that have contact with non US entities
A
A. Requirements on Non US parties that have no contact with the US
18
Q
Which sanctions regimes contain secondary sanctions?
A. Iran, North Korea, Russia, and Syria.
B. Venezuela, South Sudan, South Korea
C. China, Yemen, and Somalia
A
A. Iran, North Korea, Russia, and Syria.
19
Q
SDN Z owns 51 percent of Company A. In turn, Company A owns 49 percent of Company B, but takes an active controlling role in running the company.
- Is Company A considered an SDN by OFAC?
- Is Company B considered an SDN by OFAC?
- For those considered to be SDNs, what action does OFAC require your company to take
- What if you were a company only operating outside of the U.S.?
A
- Yes it is 51% owned by an SDN
- No but Company A owns 49% of Company B (very good change OFAC can designate)
- Hard to answer, if US company, can’t do business with Company A - if you have assets from Company then Freezing & Blocking may apply.
- 1) Generally, US Law does not prohibit non-us companies from dealing with SDNs however secondary sanctions may apply - exposing you to secondary sanctions.
2) What kind of business are you doing? – transactions buying in US Dollars or selling goods and services – may apply)
20
Q
Which statement correctly defines facilitation?
A. Facilitation occurs when a non U.S. person helps someone perform a transaction that the U.S. person could not take part in directly B. Facilitation occurs when a U.S. person helps someone perform a transaction that the non U.S. person could not take part in directly C. Facilitation occurs when a U.S. person helps someone perform a transaction that the U.S. person could not take part in directly
A
C. Facilitation occurs when a U.S. person helps someone perform a transaction that the U.S. person could not take part in directly
21
Q
What is the First Line of Defense when applied to internal controls?
A. The business
B. The auditors
C. The compliance team
A
A. The business
22
Q
As the sanctions compliance officer at your U.S. company, you have overseen the recent deployment of your company’s first sanctions screening tool. You are called into a meeting with your boss to congratulate you on this achievement. The boss mentions that now that this “screening thing” is working, you should be free to work on other areas of compliance now since the company should be fully compliant with OFAC now.
What should you convey – diplomatically, of course – to help them understand what else needs to be done?
A
Screening is an essential component, but it is only part of 1 component (1 internal control among several internal controls), Mgmt commitment, risk assessment, internal controls, testing and audit, and training. Even with screening, you’re constantly updating, and constantly testing. It’s a great start but it is just a start.
23
Q
OFAC 50% Guidance: Which companies are considered to be blocked? Explain your answer.
SDN: MR. X owns 50% of Company A and Company B. Company A owns 25% of Company C and Company B owns 25 % of Company C.
Tip. Visualize all parties subject to sanctions in Red. e.g. MR. X (red box) since he owes 50% of Company A & B they are both red boxes. Because Company A & B have 25% stake in Company C 25% + 25% = 50% owed by SDNs.
A
All companies are sanctioned.
24
Q
OFAC 50% Guidance: Which companies are considered to be blocked? Explain your answer.
SDN: Mr. X owns 50% of Company A (red box). Company A owns 40% of Company B and Mr. X owns 10% of Company B. Because Company B is own by and SDN 10% and 40% from a Company that is owned by an SDN.
A
All companies are sanctioned.
25
Your customer is a stable, well-known, local company, with no high-risk customers. They do, however, have one foreign branch located in the UK. How would you place this customer on the financial risk matrix?
A. High risk
B. Moderate risk
C. Low risk
B. Moderate Risk (based on the matrix of associated risk w/particular types of transactions and customers FIs can use to evaluate their sanctions compliance systems)
26
What is Fuzzy Matching?
A. When the information screened is relatively broad or generic
B. When the information being screened is a false positive match
C. When the information being screened is not identical, but is a close match
C. When the information being screened is not identical, but is a close match
27
You are the sanctions officer for U.S. company – American Goods, which decides to implement a sanctions screening system. American Goods deals mostly with local customers, but sometimes has customers from France and the Netherlands as well. As there are a lot of transactions on a daily basis, you decide that new customers will be batch screened. Potential matches will be dealt with using the “four eyes principle”. Audits of the system will be conducted yearly.
1. What lists should you include in your screening?
2. What are some ways your screening could be improved?
1. EU/UN/UK/OFAC, Local Lists, Internal Lists (Bad guys/grey list)
2. Real Time Screening, transaction screening, Four Eye Principle, Audits, Testing of the system
28
You are the sanctions compliance officer at a bank and your review team has escalated a positive “true hit” to you involving a new customer account. They have already moved the funds on deposit into a blocked account and now want to know what to do next.
Walk them through it –
1. What to do if you are a US bank based in the US?
2. What to do if you are a European bank based in Europe?
3. What to do if you are U.S. manufacturing company?
1 – Determine what list, look at internal procedures, clarify who has the authority to freeze funds, place funds in an interest-bearing account, hold funds, and report transactions to OFAC within 10 days.
2 – Same as above but reporting is done to the National Authority
3 – Physically sequester/freeze and follow the same process above
29
Which if the following is NOT true about an OFAC Specific License:
A. It is focused and tailored to certain needs
B. It is usually included in Subpart E of the sanctions regulation
C. It usually identifies all the parties to the license.
B. It is usually included in Subpart E of the sanctions regulation
Note: A &C would be correct if it were "True".
30
Which of the following elements will OFAC consider when assessing a penalty?
A. Strength of your sanctions compliance program
B. Willful behavior
C. Volume of transactions
D. All of the above and more
D. All of the above and more
31
You are the general counsel at an aerospace company in Virginia, USA. You are conducting a review of the compliance program and you find a violation of ITAR in your business. You dig deeper and find out it was a willful violation. Which agencies do you VSD to?
Department of State (DDTC), DOJ, Check to see if anything in the transactions would cause reporting for BIS (export) and OFAC (sanction)
32
You are the OFAC Officer in a U.S. bank and have been passed on the following three transactions that your team has deemed suspicious.
Do you agree that these transactions suspicious? Which ones and why?
1) This transaction documentation lists the name “Slick Bank” in the customer name field. It is also missing the date of birth and full address of the customer.
2) This transaction involves a cover payment with standard MT202-COV message from a customer in Cuba.
3) This resubmitted transaction has an identical amount to the previous payment that was rejected, but the names of the parties are still the same.
1 – Suspicious – Bank name in customer field
2 – Sounds like it’s prohibited – need to verify – could be suspicious
3 – Possibly Suspicious – why did we reject it the 1st time around
33
What is Stripping?
A. The automatic act of deleting or changing information from payment messages.
B. The deliberate act of deleting or changing information from payment messages.
C. The coerced act of deleting or changing information from payment messages.
B. The deliberate act of deleting or changing information from payment messages.
34
Why does Homeland Security investigate most criminal penalties related to OFAC?
35
True or False: OFAC regulations require a robust compliance program from all US Companies?
A. True
B. False
B. False
36
True or False: notwithstanding what is or isn’t in OFAC regulations, prudential regulators expect to see an OFAC risk assessment when they come to exam your company.
A. True
B. False
A. True
37
As OFAC compliance officer at your company, you have been made aware that the latest SDN list update has caused an alert between a new SDN and a vendor with an existing contract with your company.
What do you do now?
1) Be sure you are dealing with a true match, if it is the OFAC designation voids the contract - the vendor needs to be prevented from providing you services - unless you get a license.
2) Any payments has to be placed in an interesting bearing account (blocked account process)
38
Consider the same scenario, but instead of being a match to the SDN List, the vendor is a sectoral sanctions target covered by prohibitions on both new equity and new debt. Would this change your course of action? If so, how?
1) Ensure if a true match, if true match - sectorial would not void the vendor relationship - you need to be sure you follow licenses.
2) You can keep them if you want to but it will get harder to do so.
39
What if, instead of a vendor, it was a supplier who was not a sectoral sanctions target? Would this change your sectoral sanctions analysis? How?
Sectorial would not void the vendor relationship - you need to be sure you follow licenses. You need to be careful and aware of payments so you don't run into an extension of credit issues (payback issues) and reputation risks.
40
True or False: If a name isn’t on one of OFAC’s lists, it isn’t’ sanctioned.
False
41
True of False: If a sectoral sanctions target subject of a prohibition on debt greater than 30 days pays an invoice for other authorized services 90 days after the invoice date, that’s not a problem?
False
42
You are the OFAC Compliance officer at your bank and your review team has escalated a positive match to you involving a new client account. They have already moved the funds on deposit into a blocked account and now want to know what to do next. Walk them through it.
Make sure it's an interest-bearing account and File a Report of Blocked Transactions form. Remember if they give you the money and you are holding you have to hold it you cannot give it back.
43
You have blocked a wire transfer due to a positive match to an OFAC SDN. The funds are now in a blocked account. How many days do you have to complete your filing with OFAC?
A. 1 day
B. 5 days
C. 10 days
D. 30 days
C. 10 days
44
You are the OFAC compliance officer at a US Bank. Your firm processed a wire transfer on behalf of your client and, while it alerted in your sanctions compliance screening tool because of a similarity between your client and as SDN, it was dispositioned as false positive based on the full details you have on file for your client. Nonetheless, a downstream bank has notified you that they blocked your client’s payment and report it to OFAC. Unfortunately, they asked you for no further information before they did so. What do you tell your client?
Once the money is block it's out of your control explain to the client and help them understand what they need to get an OFAC license and provide the document with all the details of the transactions - you can't give them the money back. You have to set the expectations accordingly.
45
Under the U.S. system, designation as an SDN also applies automatically to
A. Entities owned or controlled by SDNs
B. Entities owned 50 percent or more by any combination of SDNs
C. Owned 50% or more by a single SDN
B. Entities owned 50 percent or more by any combination of SDNs
46
Which of the following is a red flag for a financial transaction?
A. The payment crosses international boundaries
B. The payment is denominated in a currency different from that of the countries of the parties involved
C. Key information in a payment message has been omitted
C. Key information in a payment message has been omitted
47
Which do both OFAC and the EU identify as the first key element to a sanctions compliance framework and compliance program for dual-use trade controls, respectively?
A. Management commitment to compliance
B. A system for screening customers and transactions
C. A written sanctions policy
A. Management commitment to compliance
48
“Screening” refers to
A. An automated system for identifying key words in data fields
B. Any sort of review of information regarding a person or transaction to determine if sanctioned elements are present
C. A process for assessing the sanctions risk of a transaction
B. Any sort of review of information regarding a person or transaction to determine if sanctioned elements are present
49
A specific license is valid with respect to
A. All parties identified in the license
B. The applicant for the license only
C. All parties performing the sorts of transactions identified in the license
A. All parties identified in the license
50
A filing with a legal authority regarding potential sanctions violations is known as
A. A retroactive license application
B. A notice of possible violation
C. A voluntary self-disclosure
C. A voluntary self-disclosure
51
What best describes “Sanctions”?
A. Foreign policy tools designated to isolate, impair and impede the operations of targets
B. A competitive disadvantage based on political decisions from the Department of Treasury
C. Penalties levied on people dealing with foreign terrorists and domestic criminal organizations.
D. Window dressing until military options can be used.
A. Foreign policy tools designated to isolate, impair and impede the operations of targets
52
What types of targets does OFAC usually focus on?
A. Countries the US is engaged in armed hostilities with
B. Vessels, trains and other vehicles in foreign countries
C. Cities, provinces, specific zip codes and other targeted regions
D. Countries, rouge regimes, non-state actors, and their support networks.
D. Countries, rouge regimes, non-state actors, and their support networks.
53
What is the main vehicle used by OFAC to publish the names of targets subject of blocking and transaction prohibitions?
A. The Entity List
B. Press conference
C. Tweet
D. The List of Specially Designated Nationals & Blocked Persons
D. The List of Specially Designated Nationals & Blocked Persons
54
What is true about a Specially Designated National (SDN)?
A. It can be a front company, senior officials of rogue regimes, terrorists, drug traffickers, or WMD proliferators
B. All of the above
C. It can be anywhere in the world
D. It can be individuals and entities that are owned or controlled by, or acting for or on behalf of, or providing material support to sanctions targets
B. All of the above
55
What happens when something becomes an SDN?
1) Not all that much, its just a publicity stunt
2) All property must be blocked and no dealings are permitted
3) No transactions or services are permitted
4) The person will be listed on the Interpol “Most Wanted List”
___
A. 1 and 2
B. 1 and 4
C. 2 and 3
D. 3 and 4
C. 2 and 3
56
What is the most frequently used statue to create OFAC sanctions programs?
A. Comprehensive Iran Sanctions, Accountability, and Divestiture Act (CISADA)
B. International Emergency Economic Powers Act (IEEPA)
C. Trading with the Enemy Act (TWEA)
D. Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (USA Patriot Act)
B. International Emergency Economic Powers Act (IEEPA)
57
What are the key steps to creating a sanctions program?
A. Executive Order, Tweet, OFAC Update
B. Executive Order, OFAC Update, OFAC regulations
C. OFAC Update, White House press conference, State Department briefing
D. Proclamation, tweet, OFAC regulations
B. Executive Order, OFAC Update, OFAC regulations
58
What element does an Executive Order NOT contain when creating a sanctions program?
A. Directing agencies to take specific steps
B. Declaring a national emergency
C. Reference to the United Nations Charter Chapter IV
D. Finding of an unusual or extraordinary threat to national security
C. Reference to the United Nations Charter Chapter IV
59
What is true about an OFAC Update?
A. A and B
B. You can sign up by e-mail for alerts
C. It contains identifying details on SDNs, FAQs, fact sheets and other information
D. It is never as reliable as a tweet
60
OFAC regulations …
A. Define key terms and direct you to OFAC’s website for details
B. Are needless red tape hurting our business
C. Don’t say very much
D. Defines key terms and explains what is prohibited, what is exempted, and what can be licensed
D. Defines key terms and explains what is prohibited, what is exempted, and what can be licensed
61
Comprehensive sanctions …
A. Only apply to target if it appears on the SDN List, otherwise it can’t be sanctioned
B. Involves only an investment ban
C. Involve target use of prohibitions on specific regions of a country
D. Involve a broad blocking provisions and broad prohibitions on transactions and services, often for an entire country or region
D. Involve a broad blocking provisions and broad prohibitions on transactions and services, often for an entire country or region
62
Limited sanctions …
A. Are targeted, list-based in nature
B. Can be directed at conduct-based issues like terrorism or narcotics trafficking or are list-based
C. Apply to an entire country or region, and sometimes even nationals of that country wherever they are located
D. Do not apply to activities of US person outside the United States:
B. Can be directed at conduct-based issues like terrorism or narcotics trafficking or are list-based
63
Common prohibitions included in OFAC sanctions programs are:
A. Do not apply to activities of US persons outside the United States
B. Blocking of property, no exports or imports of goods or services, no facilitation, no evasion
C. Blocking of property, no trade activities, referral of sanctioned business to countries where it is legal to do it is authorized
D. Blocking of property, no imports or exports of goods, all services generally authorized
B. Blocking of property, no exports or imports of goods or services, no facilitation, no evasion
64
Sectoral sanctions prohibitions typically involve:
A. Prohibitions on exports of informational materials, good, and medicine
B. Prohibitions on all transactions with an entire sector an economy
C. Prohibitions on dealing in blocked property
D. Prohibitions on dealings in new debt or new equity
D. Prohibitions on dealings in new debt or new equity
65
Why would a policy maker choose sectoral sanctions rather than blocking?
A. Because they are weak-willed and are not willing to hit our adversaries hard
B. Because it is a shiny new tool and everyone wants to try it
C. Because some illicit actors are so interconnected to the global economy that a sudden disruption caused by blocking prohibition would have harmful, unintended consequences
D. Because blocking prohibitions are a lot of work and difficult to comply with, so we need something easier to understand and implement in the marketplace
C. Because some illicit actors are so interconnected to the global economy that a sudden disruption caused by blocking prohibition would have harmful, unintended consequences
66
What government agencies are involved in every OFAC sanctions program?
A. Drug Enforcement Administration, Department of Homeland Security, National Security Agency
B. National Security Council Department of State, Department of Justice
C. National Security Council, Central Intelligence Agency, Federal Bureau of Investigation
D. Department of Justice, Department of Defense, National Security Council, National Nuclear Security Administration
B. National Security Council Department of State, Department of Justice
67
What functions are handled by OFAC’s Compliance group?
A. OFAC updates, public engagement, regulated industries enforcement
B. Never answering the hotline, expediting licensing cases, nitpicking our blocking reports
C. Building the case for imposing sanctions on new targets
D. Granting exceptions to sanctions to reduce harm from unintended consequences
A. OFAC updates, public engagement, regulated industries enforcement
68
What does OFAC’s Licensing group do?
A. Answers questions from the OFAC hotline, reviews block and reject reports, publishing OFAC Recent Actions
B. Reviews applications for exports of agricultural and medical products in order to prevent them from going to sanctioned countries
C. Reviews matters to determine whether granting an exception to permit otherwise prohibited activity will advance US foreign policy goals and reduce harm from unintended consequences of sanctions
D. Good question
C. Reviews matters to determine whether granting an exception to permit otherwise prohibited activity will advance US foreign policy goals and reduce harm from unintended consequences of sanctions
69
What does OFAC’s Global Targeting group do?
1) Uses all sources of information to build a legally sufficient case to impose sanctions on a target
2) Coordinates with other relevant agencies to de-conflict designations with, or ensure they complement ongoing operations
3) Pursues enforcement actions against parties who may violate sanctions regulations
4) Coordinates Specific License applications, but not the general licenses
__
A. 3 and 4
B. 2 and 3
C. 1 and 4
D. 1 and 2
D. 1 and 2
70
What is true about the designation process?
A. Delisting needs approval from the P-5 of the United Nations
B. OFAC focuses on the network of things that may be owned or controlled by, or acting for or on behalf of, other SDNs
C. Once you are on the SDN List, you never come off
D. Names can be added by the President via an Annex to an Executive Order
All answers are correct.
71
Prohibited facilitation could include:
A. Assisting a client with modifying payment instructions so they do not get delayed in an American bank’s sanctions screening systems.
B. All answers are correct
C. Referring sanctioned country business to colleagues in a country that permits such business
D. Changing your policy or procedures related to sanctions to capitalize on a new business opportunity that would otherwise be prohibited
B. All answers are correct
72
An OFAC risk assessment is:
A. Required by 31 CFR Part 501, OFAC’s Reporting, Procedures, and Penalties Regulations
B. A matter of sound risk management and expected by regulators
C. An optional control that is not very informative
D. Required by the Bank Secrecy Act and FinCEN Regulations
B. A matter of sound risk management and expected by regulators
73
An OFAC risk assessment should:
A. All of the above
B. Identify how to control for the risks and evaluate control effectiveness
C. Identify what sanctions risk exist in your businesses and where they are present
D. Consider OFAC’s risk matrices & FFIEC’s BSA/AML Exam manual
A. All of the above
74
Core elements of an OFAC compliance program should include
1) Policy, appointment of a responsible person, effective training
2) Internal controls and testing
3) Provisions for suspicious activity and CTR reporting to FinCen
4) Bank Secrecy provisions
--
A. 2 and 3
B. 1 and 2
C. 3 and 4
D. All of the above
B. 1 and 2
75
Sanctions screening controls
A. Are largely ineffective, expensive, and slow the flow of payments
B. Should never use fuzzy logic
C. Require robust testing for effectiveness, tuning to manage false positives, and strong data integrity controls on upstream systems
D. Are all you need to comply with OFAC sanctions regulations
C. Require robust testing for effectiveness, tuning to manage false positives, and strong data integrity controls on upstream systems
76
Which of the following is NOT true about review of potential matches from sanctions screening in tools?
A. Sectoral sanctions matches follow the same thought processes as SDN matches
B. Well-documented, standard review processes and procedures is crucial
C. Varies in complexity due to varying amounts of information that is available
D. Reviewer fatigue is a risk in an environment with high false positive rates
A. Sectoral sanctions matches follow the same thought processes as SDN matches
77
Which of the following is an example of an entity caught by OFAC’s 50% Guidance?
A. A charitable foundation based in Jakarta where 2 of 5 board members are SDNs
B. A US-based company owned 51% by a newly designated Russian SDN and 19% by a diverse set of investors who are mostly US persons
C. A company owned 60% by the Government of Sudan and 40% by an SDN
D. A Turkish company owned 49% by a Russian sectoral sanctions target and 51% by a publicly traded company listed on the London Stock Exchange
C. A company owned 60% by the Government of Sudan and 40% by an SDN
78
What are the primary types of required OFAC reports?
A. SDN Matching Results Report, Log of Active OFAC Licenses
B. Annual Report of Blocked Property, Report of Rejected Transactions, Report of Blocked Transactions
C. Suspicious Activity Report, Foreign Bank Account Report, Currency Transaction Report
D. Form 1040EZ, Form 602, SDN Listing Form
B. Annual Report of Blocked Property, Report of Rejected Transactions, Report of Blocked Transactions
79
What are two types of license used by OFAC?
A. Special licenses that are usually secret and general authorizations issued verbally on the OFAC hotline
B. Humanitarian and foreign policy
C. Good ones and bad ones
D. General licenses written into regulation and specific licenses issued on a case by case basis
D. General licenses written into regulation and specific licenses issued on a case by case basis
80
Which statement is true about the OFAC license application process:
A. The application should include clear articulation of why license authorization would be consistent with US foreign policy goals
B. Most license applications have to be submitted on a particular OFAC from
C. The application should focus on how expensive complying with the prohibitions would be to your business and complain about how long the process may take
D. You can only apply for an OFAC license by mail
A. The application should include clear articulation of why license authorization would be consistent with US foreign policy goals
81
Which factors does OFAC give great weight to in determining whether to pursue enforcement action?
A. The political priority of the sanctions program to the administration or key Congressional leadership
B. Awareness of conduct, willfulness or recklessness, harm to sanctions program
C. Whether you are publicly traded on US or equivalent exchange
D. The political affiliation of senior company executives relative to the current administration
B. Awareness of conduct, willfulness or recklessness, harm to sanctions program
82
Which statement is true about voluntary self-disclosure (VSD) to OFAC
A. VSD is considered voluntary if your regulators find the issue during an exam and tell you to file with OFAC
B. VSD can result in a 50% reduction in base penalty calculation
C. VSD is not worth the effort because OFAC rarely acts
D. VSD is a terrible litigation strategy
B. VSD can result in a 50% reduction in base penalty calculation
83
Which of the below are potential enforce options for OFAC to pursue?
A. Enhanced interrogation techniques
B. Blocking assets, rejecting transactions, reporting blocked property
C. Search warrant, Grand Jury subpoena, seizure of assets
D. No action, cautionary letter, criminal referral
D. No action, cautionary letter, criminal referral
84
Aside from the civil monetary penalty, what else can happen to your company as a result of an OFAC enforcement action?
A. All answers are correct
B. Reputational damage, shareholder lawsuits
C. Significant legal and consultant costs
D. Penalties from other regulators, criminal forfeiture
A. All answers are correct
85
Fill in the blank: OFAC civil monetary penalties can be the statutory maximum or _(…)_ the value of the transaction, whichever is greater…
A. $10,000 above
B. Triple
C. Is the equivalent of
D. Double
D. Double
86
What is a “602”?
A. Generally, refers to list-based sanctions under program tag “602” in the OFAC list entry indicating the sanctions program under which the listing was made.
B. The federal law authorizing the President to regulate commerce after declaring a national emergency in response to any unusual threat to the United States.
C. Refers to an Executive Order issued on June 2002
D. A document issued by OFAC pursuant to 31 CFR 501.602 which requires information to be furnished on demand. Also, sometimes referred to as an administrative subpoena.
D. A document issued by OFAC pursuant to 31 CFR 501.602 which requires information to be furnished on demand. Also, sometimes referred to as an administrative subpoena.
87
Which of the following outlines key OFAC reporting obligations, requirements to furnish information to OFAC, includes OFAC Enforcement Guidelines and applies to all other OFAC sanctions programs?
A) 31 CFR Part 602
B) TWEA
C) Executive Order 501
D) 31 CFR Port 501
D) 31 CFR Port 501
88
When is Annual Report of Blocked Property due?
A. December 31
B. September 30
C. January 31
D. June 30
B. September 30
89
What are the three sets of paperwork that are generally required for OFAC sanctions to actually come be?
A. Executive Order, OFAC updates and OFAC regulations
B. 31 CFR Part 501, TWEA, OFAC Enforcement Guidelines
C. 31 CFR Part 536, IEEPA, OFAC List
D. Constitution, SDN listing, No fly listing
A. Executive Order, OFAC updates and OFAC regulations
90
Which are the four main elements inside an E.O.?
A. Declares an international emergency, a congressional finding, an IEEPA, an Executive Order
B. Congressional legislation, presidential finding, foundational targets, directs foreign governments to do certain things
C. Emergency powers, presidential finding, specific Foreign Kingpin designations, directs cabinet agencies to do specific things
D. Declares a national emergency, contains a presidential finding, identifies foundational targets, directs cabinet agencies to do specific things
D. Declares a national emergency, contains a presidential finding, identifies foundational targets, directs cabinet agencies to do specific things
