CGSS Certified Global Sanctions Specialist Exam Guide & Study Material
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CGSS
Certified Global Sanctions Specialist
Exam Version: 6.0
Questions & Answers PDF
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Question 1. (Single Select)
A sanctions analyst reviews payment requests from a sanctioned country. After investigation, it appears
that the request represents a medicine export from a pharmaceutical company to a sanctioned country.
Which step should the analyst take next?
A: Review the counterparty.
B: Demand a specific license.
C: Check for applicable general licenses or exemptions.
D: Reject the payment.
Answer: C
Explanation:
In sanctions compliance frameworks applied globally by bodies such as OFAC, the EU, the UN, the UK,
Canada, and Australia, transactions involving humanitarian goods, including medicine and medical
supplies, are treated under specific regulatory categories. These frameworks include humanitarian
exemptions, general licenses, and permitted transactions for medical or health-related items. The standard
compliance expectation requires an analyst to determine whether the activity is already authorized before
taking restrictive action.
The Sanctions and Compliance Domains specify that when a transaction involves potential humanitarian
goods, the analyst must confirm whether a general license or exemption applies. General licenses
commonly authorize exports of medicines, medical devices, and humanitarian materials to sanctioned
jurisdictions. The rule requires verification of these authorizations prior to escalation, rejection, or
requesting a specific license.
If a general license exists for the type of goods or activity, the transaction may proceed in accordance with
regulatory conditions. Only when no exemption or general license applies should a specific license be
sought. Therefore, the correct immediate step for the analyst is to check applicable general licenses or
exemptions related to medical exports.
Reference from Sanctions and Compliance Domains:
Regulatory requirements relating to humanitarian exemptions under sanctions programs.
General license structures for medical and humanitarian goods in sanctions regimes.
Compliance procedures directing analysts to verify authorizations or exemptions before rejecting or
escalating transactions.
Standard sequencing: determine applicability of general licenses or exemptions prior to requesting a
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specific license.
Question 2. (Multi Select)
EU Restrictive Measures apply: (Select Two.)
A: on a vessel under the jurisdiction of an EU Member State.
B: to a company incorporated under the law of a non-EU country, that is 45% owned by a national of an EU
Member State.
C: within a non-EU country, which has a double taxation convention with all EU Member States.
D: within a non-EU country which is part of the Customs Union agreement with the EU.
E: to a company outside the territory of the EU, which is incorporated or constituted under the law of an EU
Member State.
Answer: A, E
Explanation:
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.
Reference 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.
Question 3. (Multi Select)
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Based on the Wolfsberg Guidance on Sanctions Screening, what are the core principles for generating
productive alerts? (Select Two.)
A: Manual processes that ensure lists are screened only against specific jurisdictional data
B: Including exclusions for parties that pose low risks to be omitted from screening
C: Addressing the inclusion of a "good guy" list so that it does not suppress common false positives
D: Reducing the threshold settings from the optimal level to create more productive alerts
E: Reviewing and removing reference data from screening, on an ongoing basis, once the data is no longer
risk relevant
Answer: C, E
Explanation:
The Wolfsberg Guidance identifies that effective sanctions screening depends on high-quality, risk-relevant
reference data. Institutions must regularly review and remove outdated or irrelevant data to avoid
generating unnecessary alerts and ensure screening outputs remain meaningful. Maintaining accurate and
current data reduces noise and increases the productivity of alerts.
The Guidance also emphasizes that institutions may use “good guy lists” to reduce false positives, but
these lists must be maintained in a controlled way to ensure they do not unintentionally suppress alerts that
could indicate sanctions risk. Proper governance must accompany good-guy lists so that risk-relevant
entities are not excluded from screening.
The Guidance does not support reducing thresholds to generate more alerts, nor does it promote removing
low-risk parties without structured criteria. It also does not recommend manual jurisdiction-specific
screening as a method of improving alert quality.
Reference from Sanctions and Compliance Domains:
Wolfsberg principles on management of reference data for sanctions screening.
Guidance on proper use and governance of “good guy lists.”
Recommendations for ensuring alerts remain relevant, accurate, and risk-based.
Question 4. (Single Select)
Which action is an acceptable strategy for a financial institution's payment sanctions screening process?
A: The institution excludes incoming SWIFT transfers from sanction screening, instead relying on the
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controls of the sending/correspondent bank.
B: The institution uses software that does not account for alternative spellings of prohibited countries or
parties.
C: The institution incorporates updates to sanction listings into its automated screening tool on a monthly
basis.
D: The institution uses internally managed whitelists and calibrates the threshold to reduce false positives.
Answer: D
Explanation:
Sanctions and Compliance Domains outline that institutions must maintain effective and reliable sanctions
screening systems. This includes screening all incoming and outgoing payment messages, and institutions
may not rely solely on correspondent banks for sanctions controls. Screening tools must also be capable of
detecting alternative spellings, transliterations, and name variations of sanctioned parties.
Sanctions list updates must be incorporated immediately or as soon as practicable after publication.
Monthly updates would be considered insufficient.
The use of controlled internal whitelists, combined with proper governance, periodic review, and controlled
threshold calibration, is an accepted method used to reduce false positives while maintaining compliance
integrity. Threshold adjustments must always follow documented validation, testing, and oversight
procedures.
Reference from Sanctions and Compliance Domains:
Requirements for screening all payment messages, including incoming SWIFT transfers.
System expectations for matching name variations and alternative spellings.
Regulatory expectations for timely list updates.
Recognition of whitelist use and threshold calibration as acceptable screening optimization methods.
Question 5. (Single Select)
The Office of Foreign Assets Control has focused on sanctions risks in mergers and acquisitions by
undertaking which action?
A: Considering enforcement actions against companies that knowingly fail to do sufficient due diligence
B: Pursuing enforcement actions against companies that fail to do sufficient due diligence
C: Putting out joint guidance with the Securities and Exchange Commission that highlights the sanctions
risks of mergers and acquisitions
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D: Discouraging mergers and acquisitions in its framework for compliance commitment
Answer: B
Explanation:
Sanctions and Compliance Domains outline that OFAC has explicitly emphasized the importance of pre-
and post-acquisition sanctions due diligence in mergers and acquisitions. OFAC has pursued enforcement
actions against companies that failed to conduct adequate sanctions due diligence or did not integrate
compliance controls after acquiring foreign subsidiaries.
OFAC’s enforcement history shows cases in which companies inherited violations because they continued
business through acquired entities that were already engaged in sanctioned conduct. OFAC clearly
identifies failure to conduct sufficient sanctions due diligence as grounds for enforcement. It does not
merely “consider” such actions, nor has it issued joint SEC guidance to warn about MandA sanctions risks.
OFAC also does not discourage mergers and acquisitions; instead, it stresses compliance integration and
strong due diligence.
Reference from Sanctions and Compliance Domains:
OFAC expectations for sanctions due diligence in mergers and acquisitions.
Enforcement actions taken for failure to conduct adequate pre-acquisition and post-acquisition compliance
reviews.
Compliance requirements for inherited liabilities through acquired subsidiaries.
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