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#1955121 - 08/20/14 03:05 PM OFAC check on Loan Guarantor
SUSANE1 Offline
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Joined: Mar 2008
Posts: 808
where can I find info on how far you need to go with OFAC checks, especially on loan guarantors?

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BSA/AML/CIP/OFAC Forum
#1955161 - 08/20/14 03:41 PM Re: OFAC check on Loan Guarantor SUSANE1
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
OFAC compliance; i.e. checking the list, is risk based and depends on the individual bank's risk assessment. There is no legal requirement to check the OFAC list under any circumstance.

What that means is that it's up to your bank to decide what your level of risk is and choose the pulse points where you check the list. To my knowledge, there is no credible resource that would tell you when to check and when not to check beyond the OFAC risk assessment done by your bank.
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#1955285 - 08/20/14 05:38 PM Re: OFAC check on Loan Guarantor SUSANE1
Princess Romeo Offline

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Princess Romeo
Joined: Jun 2001
Posts: 8,272
Where the heart is
Here is my standard answer when someone asks "Are we required to check OFAC for (fill in the blank of transaction type, party involved, etc.)

That’s a risk based decision. OFAC does not require that you screen any names before conducting a transaction. OFAC’s rule and reasoning is quite simple:

Quote:
You better NOT conduct a transaction with anyone on the list, and how you make sure of that is up to you. However, if we find out that you did conduct a transaction with a person or entity on the list, the severity of our penalty will be based, in part, by how much you do or do not have in place to prevent it from happening. If you have a comprehensive program and this was a simple slip-up, the penalty will not be as severe as if we find that you had no controls in place to prevent that particular transaction.
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#1955392 - 08/20/14 07:23 PM Re: OFAC check on Loan Guarantor SUSANE1
HappyGilmore Offline
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Joined: Jun 2004
Posts: 19,858
Pulling people out of the ditc...
as to the original question - i don't believe a guarantor is receiving any funding of a loan, just confirming it will be paid back - i don't see a need to run them through OFAC as i see no transaction to the guarantor
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