Enterprise Management Software Aids OFAC Compliance

US and other world government crackdowns on money-laundering by terrorist organizations,

rogue states and drug traffickers have increased the responsibility of banks to conduct enhanced

due diligence. Failing to properly conduct the enhanced due diligence required by law can result

in huge fines and sanctions against financial institutions. Enterprise management software for

OFAC compliance can help banks avoid making costly due diligence errors.

The Office of Foreign Assets Control enforces US policy regarding economic and trade

sanctions against certain nations, as well as individuals and groups involved with terrorism, drug

trafficking, economically disruptive activity and illegal arms sales. Complying with OFAC

regulations regarding blocked entities is an important part of the enhanced due diligence required

of financial institutions. Lists published by OFAC such as the Specially Designated Nationals

(SDN) List, is regularly updated with organizations and people barred by OFAC.

OFAC compliance software that can work with OFAC and other government databases to check

client information against lists of persons and organizations banned by OFAC can greatly assist

financial institutions in avoiding running afoul of the law.

Since names are published from different sources and recorded differently, enterprise

management software for OFAC compliance must utilize a flexible search algorithm that not

only recognizes different variants or misspellings of names, but also reduces the number of false

positives to a minimum. To accomplish this, OFAC Compliance Software tools use various

search techniques such as Fuzzy Logic searches, and then assign a score based on their matching

proximity. Lower scores are automatically discarded.

Also, to minimize false positives the OFAC Software must be capable of processing different

types of records. This requires that specific search logic for different transaction formats such as

Fedwire, SWIFT, ACH, or Letters of Credit, be implemented that search and appropriately

combine the data fields within these transactions.

Proper OFAC compliance is a high stakes matter for banks and financial institutions. BNP

Paribas, France’s largest bank, recently set aside $1.1 billion in anticipation of a pending

settlement with OFAC regarding violations or regulations. OFAC penalties have increased

greatly since 2009, when the US Congress increased statutory minimum penalties for OFAC

violations from $11,000 to $250,000 per violation, or twice the value of the underlying

transaction.

OFAC examines several factors when assessing fines, including size and sophistication of the

entity, reporting procedures and awareness of senior management. Good enterprise management

software can help financial institutions avoid OFAC compliance issues and allow them to

quickly self-report when unintentional violations occur.

Ocean Systems Banking Technology makes anti-money laundering software that helps banks

and financial institutions stay on the right side of the law. This includes OFAC compliance

software. With Ocean Systems software, the risk of non-compliance can be avoided and

mitigated.

Company Bio

Ocean Systems Banking Technology (https://www.oceansys.com/index.aspx) provides banking

compliance technology that helps financial institutions successfully follow the many complicated

regulations created by the US and other governments. The company has an established track

record in providing flexible, adaptable software solutions that keep pace with the ever-evolving

regulatory obligations of financial institutions.

For more information, please visit us at http://www.oceansys.com