Which test should be included in a bank's OFAC sanctions screening audit program?
Click on the arrows to vote for the correct answer
A. B. C. D.D
The correct answer to this question is D: reviewing wire transfer screening processes to ensure that potential name hits are investigated promptly.
OFAC (Office of Foreign Assets Control) sanctions screening audit program is a critical component of a bank's overall compliance program. OFAC is responsible for administering and enforcing economic and trade sanctions against designated countries, entities, and individuals.
As part of their OFAC compliance program, banks are required to screen their customers and transactions against the OFAC sanctions list to prevent money laundering and terrorist financing. Wire transfers are one of the most common methods used by criminals to move illicit funds across borders, and they represent a significant risk for banks.
Therefore, reviewing wire transfer screening processes to ensure that potential name hits are investigated promptly should be included in a bank's OFAC sanctions screening audit program. The review should include assessing the effectiveness of the bank's screening technology, the policies and procedures for investigating potential matches, and the timeliness of the investigation process.
Option A, looking at copies of SARs/STRs filed with regulators to ensure completeness, is not directly related to OFAC sanctions screening and is more focused on ensuring that the bank's Suspicious Activity Reporting (SAR) program is functioning correctly.
Option B, ensuring that all clients with foreign identification are subject to enhanced due diligence (EDD), is a part of a bank's customer due diligence program and is not specifically related to OFAC sanctions screening.
Option C, examining Human Resources processes for conducting criminal background checks on executives, is related to personnel screening and not directly related to OFAC sanctions screening.