What to do when an OFAC check returns a true match
An OFAC hit is only a candidate until you confirm it. Compare the full list entry with your party; if several details match, treat it as a likely match and stop the transaction. If the party is on the SDN list, block the property; if the transaction is prohibited but nothing is blocked, reject it. Either way, report to OFAC within 10 business days and keep complete records. OFAC sets out these steps in its guidance on potential matches (OFAC FAQ 5).
First, is it a true match?
Most hits are not. OFAC's method is to confirm the hit is against an OFAC list, then compare the details of the full entry, such as date of birth, nationality, ID numbers, address and registration, with what you know. If you can reasonably determine the match is not valid, OFAC says you may proceed (OFAC FAQ 5). Our false positive guide walks through that comparison.
OFAC does not confirm potential matches or false positives for you (OFAC FAQ 5). The decision, and the record of how you reached it, are yours.
If it is a likely match: stop
Do not complete the sale, the closing or the payment while you decide. OFAC's guidance is to follow your organization's procedures for likely matches and to check whether an authorization or exemption applies before acting (OFAC FAQ 5).
Block or reject
OFAC's guidance separates the two outcomes (OFAC FAQ 5):
| Situation | Action |
|---|---|
| A person or entity on the SDN list, or a blocked government, has an interest | Block the property |
| A sanctioned jurisdiction is involved but no blocked person has an interest | Reject the transaction |
| No OFAC connection, or the dealing is authorized or exempt | Process it |
Blocking means holding the property and not dealing in it. OFAC's guidance says blocked funds should go into a qualifying, segregated, interest-bearing account at a federally insured U.S. financial institution (OFAC FAQ 5).
Remember the 50 percent rule: a company owned 50 percent or more in the aggregate by blocked persons is blocked even if it is not listed (OFAC FAQ topic 1521).
Report within 10 business days
- Blocked property: an initial report is due within 10 business days of the date the property became blocked (31 CFR 501.603).
- Rejected transactions: a report is due within 10 business days of the rejection (31 CFR 501.604). The rule's definition of transaction includes sales or purchases of goods or services, not only payments.
- Annual report: anyone holding blocked property must report what they held as of June 30 by September 30 each year (31 CFR 501.603).
Primary responsibility for the blocking report sits with whoever actually holds the property. Another person's report about the same property does not excuse you unless you actually know it was filed (31 CFR 501.603).
Keep the records
Keep everything: the screening result, the list entry, your comparison, who decided and when, and the reports. Records of blocked property must be available for as long as it is blocked and for at least 10 years after it is unblocked; transaction records for at least 10 years (31 CFR 501.601).
Get help early
A true match is the point to call your lawyer and, if you hold funds, your bank. OFAC's guidance also points to its Compliance Hotline for questions about the steps above (OFAC FAQ 5).
After the match
Review how the match reached you. If it came from a re-screen rather than onboarding, your schedule did its job. If it was caught late, tighten the schedule; see how often to re-screen.
This is screening data, not legal advice. Run a free OFAC check to see the full list entry behind any hit before you decide.