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Sanctions List Checks: Protect Your Business from Legal Consequences
Key Points
- Regular checks are essential: Sanctions lists need to be checked regularly to avoid legal consequences, economic risks, and reputational damage.
- Automate sanctions list checks: CleverKYC software can automate sanctions list checks for new business relationships (onboarding due diligence) and existing ones (ongoing due diligence).
- Enhanced due diligence: Nexis Diligence software can perform enhanced due diligence on individuals with negative hits in sanctions lists.
- OFAC recommendations: OFAC recommends appointing an OFAC sanctions officer, conducting regular risk analysis, setting internal compliance requirements and checks, independent tests and audits, and training employees.
- Mandatory for all companies: Sanctions list checks are mandatory for all companies, regardless of size or industry.
Frequently Asked Questions
What is a sanctions list?
A publicly accessible directory of companies, organizations, or individuals under economic and/or legal restrictions.
Who is obliged to check sanctions lists?
Every company, regardless of size or industry, must screen new and existing relationships for sanctions.
Why do sanctions lists have to be checked?
To perform business transactions legally compliantly, avoid fines, imprisonment, and economic risks.
How often do sanctions lists have to be checked?
Ideally, automatically in the background of ERP or CRM systems to minimize risks.
Which sanctions lists need to be checked?
According to EU regulations and Foreign Trade and Payments Act, companies must check the European Common Foreign and Security Policy (CFSP) list.
How can sanctions lists be checked?
Using a proficient software that can run automatic screenings in the background.
What are the OFAC sanctioned countries?
Dependent on the country you belong to and the sanctions list applicable to you.
What is the purpose of OFAC sanctions?
To combat terrorist activities worldwide by avoiding non-compliant entities and people, safeguarding business reputation, and minimizing risks.