Proof of OFAC search

We currently print the screen indicating that we have performed an OFAC search for each new account. Is it necessary to print the search results and keep with the signature card?

We keep our OFAC search results with each signature card as proof we have performed the OFAC search. How else can you prove to the examiners that a search was performed?

It's your procedures, not the law, that require an OFAC search be performed. Your procedures can describe what would constitute "proof," starting with initials or a check in a box.

Does your OFAC software give you the ability to pull reports as "proof"?

I'm not sure but I will definitely look into that.

Ken is right that your procedures may state the when the OFAC check is done that you mark a box or put a check mark. What I ran into is that is fine if everyone does it. But we had just a few where they either forgot to mark the box or when the examiners ask about an OFAC check they said they did not do it so we ended up having to print off proof of the check for the examiners.

We used to check a box to show that we did the search, but we ran into the same problem, not everyone was consisitent. So we changed our procedures to keep the print out with the opening account docs. This way we are able to track if one was missed and track the exceptions to follow up on. This made our auditirs and examiners much happier.

I will admit to having a few chuckles when reviewing loan files where OFAC was checked on EVERYONE involved in the transaction:
*Bank of America (The receiving bank on the domestic wire)
*First American Title Company (The Title Company handling the transaction)
*XYZ, Inc. (A publicly traded company selling the property)
and so on.

I feel so much safer.....

I guess what gets me is when you look at all of this effort on checking OFAC, has anyone reading this ever had a confirmed hit on a domestic transaction?

Yeah I know - there are about a half dozen or so domestic entities on the OFAC list - and the probably of one of them conducting a transaction at your bank is probability about 1 in 3 Trillion.


Quietly steps off of soapbox and backs away while looking furtively for any OFAC police.....

http://www.treasury.gov/press-center/press-releases/Pages/tg1320.aspx

A new US one today

Still not seeing Bank of America, First American Title or any publicly traded companies on the list.

All I am saying is that a common sense application of OFAC seems to have gone out the window, oh, about 10 years ago.

But when you have an automated OFAC system (as most do)it is difficult to turn it off (and more time consuming) for Bank of America, First American Title an any publicly traded companies

Automated systems are one thing, and typically you don't get a print out of each name result unless you are using E-Funds at account opening, and I don't think many folks here are opening accounts for First American Title.

What I have come across, time and again, are the "manual" systems where the name is input and then the page is printed showing the results of each name search. Then these pages are dutifully placed in the loan file. In some cases, there is then a checklist where someone has carefully filled out that the OFAC search was done on Bank of America and FATco.

I mean, how many times do you have to print a page that says First American Title Company is not a match on the OFAC list?

If it is in their policy and risk assessment it is a requirement eventhouth a waste of time.

If the FI can write a policy that excepts Bank of America and First American Title they can exclued them.

Back to the orignial question

http://www.ffiec.gov/bsa_aml_infobase/pages_manual/OLM_038.htm

Transaction Testing
6. On the basis of a bank’s risk assessment, prior examination reports, and a review of the bank’s audit findings, select the following samples to test the bank’s OFAC compliance program for adequacy, as follows:

•Sample new accounts (e.g., deposit, loan, trust, safe deposit, investments, credit cards, and foreign office accounts,) and evaluate the filtering process used to search the OFAC database (e.g., the timing of the search), and documentation maintained evidencing the searches.

Our system automatically scans the customer name when we upload the new account. The only time we print anything is if we have a potential "hit". System also does a scan of they entire database every night. We have this in our policy and procedures and have never had a problem with examiners.

Compliance_angel, what system do you have that runs nightly for your OFAC scan??

Not Compliance_angel, but our core processor (Jack Henry) runs a nightly scan.

We have the same. And, any time OFAC is checked a report is generated with the information that was checked and available for review the following day.

Verafin, nightly.