What Lists Do I Use
Local Asset Freeze Lists: EU List HMT Asset Freeze (NI)
Extra-Territorial Lists: OFAC SDN OFAC Consolidated
Additional Risk Lists: UN CIAC UK Proscribed Terror List Section 311 AML List US Export Control Lists Dual Use Goods list Private Lists Terrorist Lists
How do I get Sanctions Lists
Consolidated List
List Vendors Take the notices from regulators and combine to create profiles across regulators.
Direct Take consolidated lists
from regulators and format them for your own
matching engines.
Banks Can choose to get lists however they like.
Some get all of their lists directly.
Some get all of their lists from a vendor Some choose on a list by list basis.
What Do I Screen My Business
Payments
Cross Border
Domestic
Charity
Customers
Personal Customers
Business Customers
Their Controllers
Their Subsidiaries
Their Activity
Relationships
Employees
Directors
Correspondents
Suppliers
Contractors
Operations
Trade Finance
Asset Finance
What are the pitfalls • Data Quality • Screening throughout the relationship • Monitoring your business customers
Fines Comprehensive vs Targeted
$-
$100,000,000
$200,000,000
$300,000,000
$400,000,000
$500,000,000
$600,000,000
$700,000,000
$800,000,000
$900,000,000
OFAC Fines since 2003 by Program
What Do I Screen Against
Country Name: Syria
Cities Towns Regions Ports: Aleppo Damascus Homs
Non-English Names:
알레포 アレッポ อะเลปโป Alep ܒ
Alèp Alepas Alepo Aleppo Aleppó Aleppu Beroea Halab Haleba Halep Heleb Hələb Xalab
Screening - Scenarios
Osama bin Laden Osama bin Mohammed bin Awad bin Laden
أسامة بن محمد بن عوض بن الدن
O bin-Laden
Osama bin Lasden
Усама бен Ладен Osama ibn Laden
Screening – Cycle of Doom Lower Fuzzy
Threshold
Get more Alerts
Hire Bigger Team
Worry
Fuzzy matching will never capture everything that you would ideally like. A compromise has to be found that suits your risk. If you let things outside of your risk appetite influence your fuzzy matching threshold, then you will spiral out of control.
Screening – Investigation Model Decision Making
Investigative Elimination
Process Elimination
Automated Elimination
There have been some big fines
OFAC have been handing out massive fines, particularly to European Banks
Don’t Ignore The Evidence
On December 9 2010, January 7 2011, and April 7 2011, HSBC US processed payments of $11,492.86, $14,963.25, and $13,709.96 to an SDN: Husayn Tajideen. Although HSBC identified the names in the SWIFT Payments initially, and blocked the payments pending an investigation, the results of the investigation (SWIFT 195/196 messages) were not screened. The payments were released because the evidence gathered was ignored. OFAC fined HSBC $32,400
If Its Broke – Fix It, and be quick about it.
Bank of America, N.A. (Bank of America) has agreed to remit $16,562,700 to settle potential civil liability for 213 apparent violations. Between September 10, 2005 and March 31, 2009, Bank of America processed 208 transactions totalling approximately $91,192 on behalf of, and failed to properly block five accounts owned by, 10 individuals whom OFAC had previously added to its List of Specially Designated Nationals and Blocked Persons (SDN List). Bank of America demonstrated reckless disregard for U.S. sanctions requirements by failing for more than two years to adequately address a known deficiency in its OFAC screening tool that prevented the bank from identifying potential matches to individuals with multiple or multi-part last names on the SDN List; as early as October 2006, at least one official in Bank of America’s office responsible for OFAC compliance was aware of the deficiency, but the bank did not resolve the deficiency until February 2009.
When is Fuzzy not Fuzzy Enough
In 2009 CITI processed a payment for: Higher Institute for Applied Science and Technology The SDN List contains the entry: Higher Institute of Applied Science and Technology CITI subsequently improved their screening so that this case would be found if it was processed again. There were four other such instances of the filter failing to catch other non-exact names, but unfortunately these are not listed by OFAC. CITI were fined $217,841, this was considered non egregious partly because other correspondent banks blocked the payments.
Look at the Whole Case
On March 11, 2009, Deutsche rejected rather than blocked a $10,000 funds transfer originated by Intercontinental Bank Plc, Lagos, Nigeria, on behalf of Amsergs Nigeria Ltd., destined for the account of Chahar Mahal va Bakhtiary Yeast Co., Isfahan, Iran, at the Export Development Bank of Iran (“EDBI”). OFAC has designated EDBI as an SDN. Deutsche’s screening stopped the transaction for review due to a number of potential matches, including to Iran and to EDBI. A total of seven Deutsche employees, including a senior member of the review team who was the final reviewer for escalated OFAC matters, reviewed this transaction and failed to notice the reference to EDBI in the payment. Deutsche settled for $18,000.