ACAMS CGSS Practice Test Questions Answers

EU Restrictive Measures apply to all persons and entities within the territory of the EU, including airspace and territorial waters, and to any vessel or aircraft under the jurisdiction of an EU Member State. This establishes that sanctions obligations extend to vessels registered under EU jurisdictions regardless of location.

EU sanctions also apply to all legal persons, entities, and bodies incorporated or constituted under the law of an EU Member State, even when those entities operate entirely outside EU territory. Legal incorporation under EU law creates an ongoing obligation to comply with EU sanctions.

EU ownership by itself does not trigger sanctions applicability, so a non-EU company that is 45% owned by an EU national does not fall under EU Restrictive Measures. Additionally, arrangements such as double-taxation conventions or participation in customs union agreements do not extend the territorial or legal applicability of EU sanctions to non-EU jurisdictions.

References from Sanctions and Compliance Domains:

Territorial applicability of EU sanctions, including vessels and aircraft under Member State jurisdiction.

Applicability to companies incorporated under EU Member State law regardless of geographic operations.

Legal and territorial definitions outlining the scope of EU Restrictive Measures.

Effective internal controls for virtual asset service providers include:

• Sanctions screening of users, wallets, and transactions.

• IP blocking/geolocation controls to stop access from sanctioned jurisdictions.

• Keyword screening for wallet names, addresses, or known illicit indicators.

• Reviewing and enforcing end-user agreements, including prohibitions on using the platform for sanctioned activity.

Other options include unnecessary or ineffective controls (downsizing staff, screening employees, or vendor-only screening), which are not aligned with sanctions-control best practices.

Sanctions and Compliance Domains explain that fuzzy logic screening includes phonetic algorithms (e.g., Soundex, Metaphone) to identify variations in the spelling or pronunciation of names. This allows a screening tool to detect near matches and transliteration differences that would not match under exact-match logic.

Inequality lists, big data, and whitelists are not fuzzy matching algorithms. Whitelists are used for reducing false positives, not matching logic.

A four-eye check is a standard internal control requiring two independent reviewers to validate decisions, ensuring accuracy, transparency, and reducing the risk of error or inappropriate clearance of alerts.

Sanctions and Compliance Domains identify this as a critical component of the alert-handling process, enabling oversight and minimizing compliance failures.

Fuzzy matching is a screening technique, not a control mechanism. Batch screening and threshold calibration relate to system functionality, not independent quality assurance.

An effective export compliance program must include formalized and documented screening procedures, including payment screening, trade documentation screening, and counterparty checks. This ensures compliance with sanctions, export restrictions, and embargo requirements.

Freight forwarders may assist but do not replace internal compliance responsibilities. Boycott-related terms must be avoided, and collecting vouchers is not an export controls safeguard.