The Certified Global Sanctions Specialist (ACAMS CGSS) (CGSS)

OFAC’s 50 Percent Rule requires aggregation of ownership by SDNs and entities owned 50% or more by SDNs.

Ownership breakdown:

• Entity X (SDN) → 30%

• Entity Y (owned 80% by an SDN) → treated as an SDN → contributes 25%

• Total SDN-derived ownership = 30% + 25% = 55%

Since aggregate SDN ownership exceeds 50% , ABC Industries is automatically considered a blocked entity , even though Entity Z is not sanctioned.

Options B and C are incorrect because explicit listing is not required—ownership triggers blocking. Option A is incorrect because one SDN at 30% alone is insufficient, but combined ownership is.

Sanctions and Compliance Domains outline that references to sanctioned ports, locations, or shipping routes in payment instructions require further investigation. Even when the transaction parties are not located in a sanctioned jurisdiction, involvement of a sanctioned port or movement of prohibited goods can trigger sanctions exposure.

The correct approach is to obtain supporting documents such as shipping documents, invoices, bills of lading, and routing information to confirm whether the shipment, goods, transport path, or third parties have any sanctioned involvement. Approving or rejecting a payment without verification contradicts sanctions screening standards.

References from Sanctions and Compliance Domains:

Requirements to investigate references to sanctioned locations in trade or payment messages.

Guidance on obtaining underlying documents to assess sanctions exposure.

Expectations for verifying goods, ports, and shipment paths.

Sanctions and Compliance Domains identify " weak aliases " as variations of names that do not robustly identify an individual. These include:

• Nicknames – informal or shortened versions (“Alex” vs. “Aleksandr”), often used for concealment.

• Names with numbers – identifiers that are easily fabricated and not tied to legitimate naming conventions.

Middle names, titles, or long names are normal cultural variations and not considered weak aliases for screening purposes.

Sanctions and Compliance Domains highlight that sanctioned individuals may attempt to evade restrictions by transferring assets, ownership rights, or operational control to family members or close associates. These transfers may appear legitimate but are often structured to conceal continuing beneficial ownership or influence.

Asset transfers to relatives or trusted associates are recognized as classic sanctions evasion red flags across EU and UK ownership and control guidance.

Opening bank accounts in non-aligned jurisdictions may create exposure, but the specific red flag of evasion is the movement of assets to associates. Changes in corporate strategy or reduced trading activity are not inherently indicative of sanctions evasion.

OFAC authorizes certain legal services through general licenses to ensure compliance with US legal obligations, including constitutional and state requirements, while ensuring such legal assistance does not facilitate prohibited transactions. These licenses allow sanctioned individuals to obtain representation for permitted matters such as contesting designations or defending legal actions.

Appropriate tuning must maintain the tool’s ability to capture spelling variations, transliterations, and linguistic differences . This is essential for detecting sanctioned parties that may appear under alternate spellings (e.g., Arabic, Cyrillic transliterations).

Exact-match screening (C) or limiting variations (A, D) leads to missed true positives and violates regulatory expectations for effective sanctions screening.

Internal controls are a core pillar of OFAC’s Compliance Framework. They ensure that the organization implements compliance activities on time, maintains documented procedures and processes, and reduces the risks identified in its OFAC risk assessment. The framework specifies that controls must be documented, tested, and capable of identifying, escalating, and addressing sanctions-related issues.

Transliteration is defined as converting writing from one script into another while preserving pronunciation as closely as possible. In sanctions screening, transliteration is important because sanctioned parties may appear in multiple scripts (e.g., Cyrillic, Arabic, Mandarin) and the automated screening system must recognize these variations.

While option B focuses specifically on converting non-Latin scripts into Latin, sanctions screening requires a broader definition that applies to any script-to-script conversion relevant to matching names globally. Thus, the correct definition is the general conversion of text from one script into another.

References from Sanctions and Compliance Domains:

Definition of transliteration in sanctions screening and name-matching methodologies.

Need for script conversion to support accurate detection of sanctioned parties across language systems.

EU sanctions apply to:

• All EU nationals ,

• All persons within the territory of the EU , including foreign nationals residing or operating within the EU,

• All EU legal entities , regardless of where they operate, and

• Any business conducted within the EU or using EU jurisdictional touchpoints .

EU sanctions do not have general extraterritorial effect. Unlike US sanctions (which can apply based on currency, goods origin, or facilitation), EU sanctions apply within EU territory , including airspace, and to EU persons globally.

EU sanctions do not automatically have a broader scope than US sanctions; in many cases, US sanctions have the broader reach.