Part 3: Tips and Tricks for a Successful OFAC Risk Assessment
By: Maleka Ali
OFAC risk assessments are the strength of any well-built OFAC compliance program. An efficient and effective program cannot be developed without knowing where the risks are hiding. Many businesses, both financial and non-financial institutions, are conducting assessments to uncover risks, design strong OFAC compliance programs, and mitigate their exposure.
The Federal Financial Institutions Examination Counsel’s BSA/AML Examination Manual says that examiners may utilize a risk-based approach. However, the enforcement standards of the Office of Foreign Assets Control remain a strict liability for violations, and executive orders are not risk-based. That being said, your OFAC program should be tempered by your organization’s risk appetite and your available resources to avoid both regulatory and OFAC violations. Your OFAC program’s policies and procedures must also match or exceed the risk. Your OFAC Risk Assessment is what will help you drive your OFAC program and allow the examiners to identify the strengths and weaknesses of your program.