What does OFAC require of banks?

Does OFAC itself require that banks set up a certain type of compliance program? No. There is no single compliance program suitable for every financial institution. OFAC is not itself a bank regulator; its basic requirement is that financial institutions not violate the laws that it administers.

What is OFAC in banking?

The Office of Foreign Assets Control administers and enforces economic sanctions programs primarily against countries and groups of individuals, such as terrorists and narcotics traffickers.

What institutions must comply with OFAC regulations?

All U.S. persons must comply with OFAC regulations, including all U.S. citizens and permanent resident aliens regardless of where they are located, all persons and entities within the United States, all U.S incorporated entities and their foreign branches.

When should OFAC checking be done?

Generally speaking, everyone and every business transaction should be screened. Screening should be performed on any party involved in the transaction, including the final end user, and the chain of individuals and businesses in-between.

Does OFAC regulations apply only to banks?

Unlike the BSA, the laws and OFAC-issued regulations apply not only to U.S. banks, their domestic branches, agencies, and international banking facilities, but also to their foreign branches, and often overseas offices and subsidiaries.

What transactions are covered by OFAC?

Transactions that are Subject to OFAC

  • Deposit (checking & savings) accounts.
  • Loans.
  • Credit Cards.
  • Wire transfers.
  • ACH transfers.
  • Lines of credit.
  • Trust accounts.
  • Loan payments.

Who must be screened against the OFAC list?

The Specially Designated Nationals and Blocked Persons List (SDN List)

  • Twelve individuals: three with U.S. dual citizenship or temporary/permanent resident status; and nine foreign individuals w.
  • Forty-five U.S. companies: all defunct shell companies established by narcotics traffickers.