CGSC flashcards
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32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Asset freeze
- A prohibition on dealing with funds or economic resources owned, held, or controlled by a designated person, including making them available indirectly.
- Economic resources
- Assets of any kind that can be used to obtain funds, goods, or services, including property, vessels, and certain contractual rights.
- 50 percent rule
- US rule treating an entity as blocked when one or more blocked persons own 50% or more of it in aggregate, directly or indirectly.
- Ownership and control test
- A test extending sanctions to entities owned or controlled by designated persons, even where the entity is not itself listed.
- Strict liability
- A regime where a violation occurs regardless of intent or knowledge, so penalties attach to the prohibited act itself.
- Sectoral sanctions
- Restrictions targeting specific transactions, such as certain debt or equity dealings, with a named party rather than freezing all its assets.
- Sanctions nexus
- Any connection between a transaction and a sanctioned person, country, sector, vessel, or currency that triggers a screening or prohibition obligation.
- Indirect dealing
- Providing funds or resources to a designated person through intermediaries, agents, or ownership chains rather than dealing with them directly.
- Risk-based approach
- Allocating compliance resources proportionate to assessed risk across customer, product, channel, geography, and transaction characteristics.
- False positive
- A screening alert that matches on name or identifier but is not the designated person, requiring documented adjudication before clearing.
- Secondary sanctions
- Measures imposed on non-designated third parties for conducting specified dealings with a sanctioned person or sector, deterring circumvention.
- Circumvention risk
- The risk that parties evade sanctions through routing, re-invoicing, altered goods descriptions, or intermediary jurisdictions to obscure the nexus.
- Beneficial ownership
- The natural persons who ultimately own or control a legal entity, which must be identified and screened to detect concealed sanctions exposure.
- Dual-use goods
- Items with both civilian and military application whose export may require licensing or be restricted under trade and arms embargoes.
- Vessel screening
- Checking vessel names, IMO numbers, flags, and ownership against sanctions lists to detect dark fleet or designated ship exposure.
- Management commitment
- Senior leadership endorsement, resourcing, and oversight of the sanctions programme, forming the foundation of an effective compliance framework.
- Risk assessment
- A documented evaluation of sanctions exposure across customers, products, geographies, and channels, refreshed periodically and after material change.
- Internal controls
- Policies, procedures, and systems such as screening, escalation, and payment filtering that operationalise the sanctions programme day to day.
- Independent testing
- Periodic review by internal audit or an external party validating whether sanctions controls are designed and operating effectively.
- Training programme
- Role-specific, recurring instruction on sanctions obligations and escalation, with effectiveness measured through testing rather than attendance.
- Recordkeeping
- Retention of screening results, due diligence, transaction records, and decisions for a defined period to evidence compliance and support audits.
- Escalation procedure
- A documented path for referring potential matches or prohibited transactions to a sanctions officer for decision before proceeding.
- Blocked property reporting
- The obligation to report frozen or rejected assets to the relevant regulator within prescribed timelines, with periodic updates.
- Voluntary self-disclosure
- Proactively reporting apparent violations to a regulator, typically a mitigating factor reducing penalty severity.
- Sanctions officer
- A designated individual or committee with clear authority and accountability for the sanctions programme and escalation decisions.
- Screening system
- Software matching counterparties and payment data against sanctions lists using fuzzy logic, generating alerts for adjudication.
- Fuzzy matching
- An algorithm tolerating spelling and transliteration variation when comparing names to lists, trading off sensitivity against false positives.
- Due diligence
- Collecting and verifying customer and counterparty information, including beneficial ownership, proportionate to assessed sanctions risk.
- Enhanced due diligence
- Additional scrutiny applied to higher-risk relationships, including deeper ownership analysis and senior sign-off before onboarding.
- List management
- The process of ingesting, updating, and version-controlling sanctions lists so screening reflects current designations.
- Policy refresh cycle
- A defined schedule for reviewing and updating sanctions policy, triggered by list changes, guidance updates, or control failures.
- Control testing
- Sampling and reviewing transactions or alerts to confirm that sanctions controls operate as designed and detect prohibited activity.