The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) administers and enforces U.S. economic and trade sanctions against targeted foreign countries, entities, organizations and individuals. Compliance with OFAC requirements can present many challenges, particularly for international companies with a global client base.
Given the heightened scrutiny on OFAC compliance in the current regulatory environment, and the comprehensive infrastructure requirements and complex technology issues associated with the development of an effective OFAC compliance program, many financial institutions and corporate entities are seeking external expertise.
HOW DAYLIGHT CAN HELP
Daylight can help you manage the risks and the costs associated with OFAC compliance. We design, document, implement and audit all aspects of OFAC compliance programs, including the following:
OFAC Risk Assessment
A robust OFAC risk assessment is an effective way to uncover potential compliance issues and help prioritize your annual compliance plan deliverables. Daylight can help you design an OFAC risk assessment strategy that is tailored to your business model and customer profile.
Validation of Transaction Filtering Technology
A periodic validation of the technology supporting your OFAC program will help ensure the efficacy of your program. A robust validation will establish, among other things, that:
- all relevant systems and transactions are feeding into the transaction filter
- all necessary fields and components of each transaction are screened
- the various sanctions lists and other internal lists of prohibited parties are updated and uploaded on a timely basis
- the transaction filter is generating expected and appropriate alerts
Daylight can design and execute end-to-end validation procedures together with your staff so that they can conduct and document future validations.
Alert Handling Procedures and Quality Assurance Review
Daylight can help you develop specific procedures for handling possible matches, or alerts, generated by the transaction filter. Daylight can also assist you with quality assurance reviews to ensure that alert handlers are applying uniform decision-making standards and work with you to develop quality assurance policies and practices.
Establishing a Global OFAC Program
Your institution can be held accountable for the actions taken by your overseas branches and affiliates, even if those entities are not themselves directly subject to OFAC requirements. Daylight can assist you in identifying these potentially high risk areas and developing appropriate controls and procedures to ensure that your global offices do not inadvertently cause you to violate OFAC regulations.
Training
Employee awareness and understanding of OFAC is essential to the success of your compliance program. Not only must your staff be familiar with the jurisdictions that are subject to OFAC sanctions, but they must know the questions to ask and when to ask them to determine whether there is a connection to any of those jurisdictions. Daylight can work with you to develop an appropriate OFAC training plan, including general and tailored training materials, and assist you in delivering the training to your employees.
Transaction Investigations and Historical Transaction Reviews
In connection with a suspected violation of OFAC, Daylight can conduct an independent investigation to ascertain whether the transaction in question violated OFAC requirements. Daylight can also provide the technical expertise and personnel to review a wider population of historical transaction data to ascertain the full extent to which the absence or failure of appropriate controls has resulted in wider-reaching violations.
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