We, along with our international wire service partners, are committed to compliance with all applicable economic and trade sanctions laws and regulations, as required by OFAC regulations and other related agencies.
Our international wire platform excludes certain designated sanctioned countries. However, other free form fields do not provide safeguards against inappropriate entries. Certain fields are also checked against OFAC Specifically Designated Nationals and Blocked Persons (SDN list) to alert you to a “hit.” Other additional narrative fields to help describe the transaction may not trigger an OFAC hit but may be problematic, nonetheless. It is the credit union’s responsibility to ensure that a payment instruction is not in violation of any OFAC restrictions and that you know your member and the reasonability of the payment.
Once the international wire is entered into our platform, further processing will screen data associated with the transaction against names identified on sanctions lists, as well as against terms and descriptors associated with certain sanctioned countries, regions, governments, and other parties. The transaction is scanned for geographic and other terms that may indicate the involvement of sanctioned jurisdictions. Potential matches are stopped and reviewed by our partner providers’ trained analysts to determine whether the transaction requires further action such as requesting additional information from the originator, the transaction being rejected with funds returned to the originator, or if the transaction is required to be frozen and the funds held. Please be aware that any fields within your international wire transaction that contain prohibited individuals, entities, or countries may result in the international wire being held for additional information, resulting in significant delays in processing or potential blocking, where the funds are frozen.
It is important to recognize that beneficiaries in a sanctioned country may attempt to obtain payment using another payment channel located in another country or region. For example, the UK and Canada do not have imposed sanctions on Cuba and some US remitters may attempt to route payments through their payment channels. Your credit union should review and adjust your screening scope to avert such situations from occurring.
From the Office of Foreign Asset Control website:
OFAC administers a number of U.S. economic sanctions and embargoes that target geographic regions and governments. Some programs are comprehensive in nature and block the government and include broad-based trade restrictions, while others target specific individuals and entities. It is important to note that in non-comprehensive programs, there may be broad prohibitions on dealings with countries, and also against specific named individuals and entities. The names are incorporated into OFAC’s list of Specially Designated Nationals and Blocked Persons ("SDN list") which includes approximately 6,400 names of companies and individuals who are connected with the sanctions targets. In addition, OFAC maintains other sanctions l32ists that may have different prohibitions associated with them. A number of the named individuals and entities are known to move from country to country and may end up in locations where they would be least expected. U.S. persons are prohibited from dealing with SDNs wherever they are located and all SDN assets are blocked. Entities that a person on the SDN List owns (defined as a direct or indirect ownership interest of 50% or more) are also blocked, regardless of whether that entity is separately named on the SDN List. Because OFAC's programs are dynamic, it is very important to check OFAC's website on a regular basis to ensure that your sanctions lists are current and you have complete information regarding the latest restrictions affecting countries and parties with which you plan to do business.
To determine if you have a valid OFAC match, visit the OFAC FAQ website.