Which product categories are generally considered dual-use goods? (Select Two.)
Correct Answer: A, C
Explanation:
Dual-use goods are items that can serve both civilian and military or weapons-related applications. Typical dual-use categories include: • Aerospace and propulsion technologies – used in civilian aircraft but also missile or defense applications. • Electronics – circuits, sensors, microchips, hardware with potential military, surveillance, or weapons applications. Luxury goods and food products are not dual-use categories. Precious metals may be highly regulated but are not dual-use under standard export-control classification. [References:, Dual-use technology categories under export controls (EU Dual-Use Regulation, Wassenaar Arrangement)., Examples of electronics and aerospace technologies as dual-use., , ]
Question 2
An entity not listed by the Office of Foreign Assets Control is attempting to open a bank account in the US. During the screening process, an employee learns that the entity’s ownership exceeds the 50% aggregate Specially Designated National ownership threshold. How should the employee proceed?
Correct Answer: A
Explanation:
Under OFAC’s 50 Percent Rule , any entity that is owned 50% or more—individually or in aggregate—by one or more Specially Designated Nationals (SDNs) is considered automatically blocked, even if not explicitly listed. Financial institutions must treat such entities as if they are SDNs. Therefore, the account cannot be opened. Senior management approval cannot override OFAC regulations, and altering ownership to bypass sanctions is prohibited facilitation. [References:, OFAC 50 Percent Rule and automatic blocking requirements., Prohibition on opening accounts or facilitating transactions for SDN-owned entities., , ]
Question 3
A sanctions analyst conducts a review of a bill of lading document. Which is considered a red flag?
Correct Answer: C
Explanation:
A key sanctions-evasion red flag in trade documents is reluctance or refusal to disclose end-use or end-user information . This may indicate diversion to a sanctioned jurisdiction, entity, or prohibited program (e.g., proliferation). Expiration dates (D) are irrelevant to sanctions. Payment timing and product suitability (A, B) are normal commercial behaviors and not sanctions red flags. [References:, Trade-based sanctions-evasion indicators (concealed end-user/end-use)., Red flags involving incomplete or intentionally vague documentation., ]
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