RCMS Sanctions & Trade Compliance 3

Question 1

Which international framework establishes the foundational principles for UN-mandated sanctions regimes adopted by member states?

Accepted Answer

UN Security Council Chapter VII resolutions

Answer

UN Security Council resolutions under Chapter VII of the UN Charter are legally binding on all member states and form the basis for multilateral sanctions regimes.

Question 2

A compliance officer receives a subpoena request from a foreign government for records of a U.S. sanctions investigation. What is the primary concern?

Accepted Answer

Risk of violating anti-boycott regulations under the EAR

Answer

Responding to foreign government requests to boycott certain countries or persons can violate U.S. anti-boycott regulations enforced by BIS under the EAR.

Question 3

In a correspondent banking relationship, what does 'nested correspondent banking' refer to in the context of sanctions risk?

Accepted Answer

Third-party banks accessing U.S. dollar clearing through an intermediary correspondent

Answer

Nested correspondent banking occurs when a respondent bank allows its own customers (other banks) to access U.S. dollar clearing, obscuring the ultimate originators from the U.S. bank.

Question 4

The Wassenaar Arrangement is a multilateral export control regime focused on which category of goods?

Accepted Answer

Conventional arms and dual-use goods and technologies

Answer

The Wassenaar Arrangement coordinates export controls on conventional arms and dual-use goods and technologies among its 42 participating states.

Question 5

When a U.S. company acquires a foreign subsidiary that has ongoing contracts with SDN-listed entities, what must it do under OFAC rules?

Accepted Answer

Immediately wind down prohibited contracts within a reasonable time frame

Answer

Upon acquisition, U.S. persons become responsible for compliance; prohibited dealings with SDN entities must be wound down, typically within a defined wind-down period.

(RCMS) Registered Compliance Management Specialist Certification Practice Test

(RCMS) Registered Compliance Management Specialist Certification Practice Test

RCMS Sanctions & Trade Compliance 3