Reference: https://www.treasury.gov/resource-center/faqs/Sanctions/Documents/faq_all.html
''Who must comply with OFAC regulations?U.S. persons must comply with OFAC regulations, including all
U.S. citizens and permanent resident aliens regardless of where they are located, all persons and entities within the United States, all U.S. incorporated entities and their foreign branches. In the cases of certain programs, foreign subsidiaries owned or controlled by U.S. companies also must comply. Certain programs also require foreign persons in possession of U.S.-origin goods. please refer to: https://home.treasury.gov
/policy-issues/financial-sanctions/frequently-asked-questions/ofac-consolidated-frequently-asked-questions

All of the three options reflect money laundering risk indicators in relation to a securities account, as they could suggest attempts to conceal the source or destination of illicit funds, or to avoid detection or reporting by authorities. According to the FATF Guidance for a Risk-Based Approach for the Securities Sector1, some of the common indicators of money laundering in securities transactions include:
* A high level of activity in securities accounts inconsistent with the customer's profile or investment objectives
* Frequent or large movements of funds between accounts or institutions, especially involving high-risk jurisdictions or offshore locations
* Use of debit cards or other payment instruments to access funds from securities accounts
* Use of complex or unusual transactions or structures without apparent economic or legal purpose
1 FATF Guidance for a Risk-Based Approach for the Securities Sector, pages 43-44.

In many jurisdictions, it is a requirement to report certain information regarding STRs to senior management and/or the board of directors. This information may be limited to the number of reports filed, the dollar amounts involved and significant trends as observed by compliance personnel. In some cases, if the activity presents a significant or potentially ongoing risk to the institution, the leaders of the institution should be made aware so that high-level decisions can be made regarding potential changes tosystems, staffing, products, services or particular relationships maintained by the institution.
Banks are required by the SAR regulations of their federal banking agency to notify the board of directors or an appropriate board committee that SARs have been filed. However, the regulations do not mandate a particular notification format and banks should have flexibility in structuring their format. Therefore, banks may, but are not required to, provide actual copies of SARs to the board of directors or a board committee.
Alternatively, banks may opt to provide summaries, tables of SARs filed for specific violation types, or other forms of notification. Regardless of the notification format used by the bank, management should provide sufficient information on its SAR filings to the board of directors or an appropriate committee in order to fulfill its fiduciary duties, while being mindful of the confidential nature of the SAR.https://bsaaml.ffiec.gov
/manual/AssessingComplianceWithBSARegulatoryRequirements/0

Senior management and AML officers may face personal liability if they knowingly allow AML violations to persist.
Option A (Correct):If senior management or the AML officer was aware of violations and failed to act, they could face regulatory or criminal liability.
Option B (Incorrect):Criminal liability depends on intent and negligence-an AML officer is not automatically prosecuted because a bank receives a regulatory order.
Option C (Incorrect):Liability extends beyond the AML officer-other senior executives can also be held accountable.
Option D (Incorrect):Violations can result in both civil and criminal prosecution, depending on the severity.
Legal Risks for AML Compliance Failures:
Civil penalties (fines and sanctions) for AML program deficiencies.
Criminal charges if executives knowingly ignore violations.
Regulatory enforcement actions leading to license revocation.
Reference:
USA PATRIOT Act Section 352 (AML Compliance Program Requirements)
FinCEN Guidelines on AML Compliance Officer Liability
FATF Recommendation 35 (Sanctions for AML Non-Compliance)