OFAC sanctions apply extraterritorially, meaning U.S. persons must comply regardless of their location.
* Option A (Correct):OFAC sanctions apply to all U.S. citizens, permanent residents, entities incorporated in the U.S. (including foreign branches), and individuals/entities within U.S.
jurisdiction.
* Option B (Incorrect):Foreign branches of U.S.-incorporated entities must comply with OFAC sanctions.
* Option C (Incorrect):OFAC sanctions apply to all U.S. citizens, including dual nationals.
* Option D (Incorrect):U.S. citizens and permanent residents must comply with OFAC sanctions even when located abroad.
Best Practices for OFAC Compliance:
* Screen all transactions against the Specially Designated Nationals (SDN) list.
* Ensure compliance programs extend to foreign branches and subsidiaries.
* Monitor international business activities for potential sanctions violations.
Reference:
OFAC Sanctions Guidelines (U.S. Treasury Department)
FATF Recommendation 7 (Targeted Financial Sanctions Compliance)
U.S. Sanctions Compliance Framework by OFAC

An offshore company is a legal entity that is incorporated or registered in a foreign jurisdiction, usually with low or no taxes, high confidentiality, and minimal regulation1. Offshore companies are often used to hide beneficial ownership, as they can create complex and opaque structures that obscure the identity and control of the real owners and beneficiaries of the assets or transactions involved2. Offshore companies can also use nominee directors and shareholders, trust and company service providers, and shell companies to further conceal beneficial ownership3. According to the web search results, offshore companies are among the most common vehicles for money laundering, tax evasion, corruption, and other illicit activities4 .
:
1: What is an offshore company? - ACAMS
2: Guidance on Transparency and Beneficial Ownership - FATF
3: Concealment of Beneficial Ownership - FATF-Egmont Group
4: What's a Beneficial Owner and Why Does it Matter? - Dun & Bradstreet
5: The Panama Papers: Exposing the Rogue Offshore Finance Industry - ICIJ

A law enforcement agency may request account opening documents and account statements from the institution to facilitate its investigation of a suspicious transaction report (STR). These documents can provide valuable information about the identity, background, source of funds, and transaction patterns of the customer, as well as any red flags or anomalies that may indicate money laundering or other criminal activities. Account opening documents may include identification documents, verification documents, customer due diligence forms, risk assessment forms, etc. Account statements may include transaction details, balances, fees, charges, etc.
:
ACAMS, CAMS Examination Study Guide, 6th Edition, Chapter 4, pp. 115-116 FATF Guidance: The Role of Hawala and Other Similar Service Providers in Money Laundering and Terrorist Financing, October 20131, p. 20 Basel Committee on Banking Supervision, Sound management of risks related to money laundering and financing of terrorism, June 20172, p. 11

The Third European Union Money Laundering Directive (3MLD) is a legal framework that aims to prevent the use of the financial system for the purposes of money laundering and terrorist financing. It was adopted in
2005 and repealed by the Fourth European Union Money Laundering Directive (4MLD) in 2015. The 3MLD applies to a range of entities that are considered to be exposed to the risk of money laundering and terrorist financing, such as:
* Financial institutions, which include credit institutions, financial intermediaries, insurance companies, investment firms, and payment service providers.
* Casinos, which include both online and offline gambling services that involve wagering a stake with monetary value.
* Real estate agents, which include both natural and legal persons that act as intermediaries in the buying and selling of real property or rights over it.
The 3MLD requires these entities to implement a number of measures to prevent and detect money laundering and terrorist financing, such as:
* Conducting customer due diligence, which involves identifying and verifying the customer and the beneficial owner, understanding the purpose and nature of the business relationship, and applying enhanced or simplified measures depending on the level of risk.
* Keeping records of customer and transaction data for at least five years after the end of the business relationship or the execution of the transaction.
* Reporting suspicious transactions or activities to the competent authorities without delay and without tipping off the customer.
* Establishing internal policies, procedures, and controls to ensure compliance with the 3MLD, and providing adequate training and awareness to staff.
* Cooperating with the relevant supervisory and regulatory authorities and financial intelligence units.
The 3MLD does not apply to defense attorneys, as they are not considered to be obliged entities under the directive. However, the 3MLD does apply to other legal professionals, such as notaries, lawyers, and accountants, when they perform certain activities on behalf of their clients, such as:
* Buying and selling of real property or business entities
* Managing of client money, securities, or other assets
* Opening or managing bank, savings, or securities accounts
* Organizing contributions for the creation, operation, or management of companies
* Creating, operating, or managing trusts, companies, foundations, or similar structures
:
THE THIRD EU DIRECTIVE ON MONEY LAUNDERING AND TERRORIST FINANCING, page 11-12 Anti-money laundering and countering the financing of terrorism legislative package, page 1 CAMS Study Guide - 6th Edition, Chapter 1, Section 1.2, page 11 V

Concentration accounts are internal accounts used by financial institutions to aggregate funds from or for various clients or other accounts. They are also known as omnibus accounts or suspense accounts. The use of concentration accounts may obscure the audit trail and the identity of the clients involved in the transactions. Therefore, the Wolfsberg Principles on Private Banking, which are a set of voluntary guidelines for preventing money laundering and terrorist financing in the private banking sector, prohibit the use of concentration accounts in a way that would prevent appropriate monitoring or identification of the clients or their funds12.
:
1: Wolfsberg Anti-Money Laundering Principles for Private Banking (2012), Section 4.3 2: The Wolfsberg Principles - an analysis, Journal of Money Laundering Control, Vol. 7 No. 3, 2004, pp. 237-240 Reference:http://www.wolfsberg-principles.com/privat-banking.html(1.2.2, 5th bullet)