For purposes of OFAC List Compliance...

If we receive an international IAT through PayPal (or a similar company) are they considered domestic ACHs? According to the exam manual, there are different expectations for screening depending on whether a transaction is a domestic ACH or an IAT.

I believe that the transaction hitting us is a domestic ACH (between our credit union and paypal) even though the description says IAT PayPal John Smith.

I am curious as to what others think.

You are most likely seeing the last (or first) leg of the transaction between PayPal and credit union (at least two are PayPals customer). The ultimate beneficiary or sender could be in a foreign country making it an IAT. Your institution (along with PayPal) could be held responsible for OFAC compliance legs that you do not see (yes it is unfair). Usually the CMP's follow Wires but it could follow ACH.

IAT or domestic should be viewed as risk levels in addition to procedural policy.

It sounds like an IAT to me.

thank you edAudit, that is what the BSA Officer and myself fear. We may have to tweak our procedures for those transactions.

Jake

The weird ones are the ones that code as IATs but are clearly government benefits. (Not the Canadian pensions, but actual US government benefits.) I always look at those twice, just to make sure!

FYI- I get a dozen of these each day at my institution and our core kicks several of them out as OFAC possible exceptions. They are all false positives, but we still have to review them.