SANCTIONS-SCREENING

The automatic check against OFAC, EU sanctions, UN sanctions lists.

Definition

Main lists: US OFAC SDN (Specially Designated Nationals), EU Consolidated List, UN Security Council, UK HMT Treasury Sanctions, France Trésor Sanctions. Matching algorithms: exact, fuzzy (Levenshtein), phonetic (Soundex, Metaphone). Common false positives (namesakes), investigation workflow required. Regulated by FinCEN (US), AMF (FR), FCA (UK).

Origin

Practice formalised by US Patriot Act (2001) and extended worldwide by FATF recommendations.

Example in context

A payment automatically blocked because the IBAN beneficiary belongs to an OFAC SDN Russia-sanctioned entity.

Related terms

• KYC — parent framework.
• PEP screening — other KYC component.