Sanctions screening
Also called OFAC screening, watchlist screening.
Checking customers, counterparties and payments against government sanctions lists before letting money move.
Last updated
What it is.
Governments publish lists of people, companies, vessels and countries that are under sanctions. In the US, OFAC keeps the Specially Designated Nationals and Blocked Persons List. Screening compares names and details in your system against these lists at onboarding, on every relevant payment and whenever the lists change.
OFAC explains that blocking imposes an across-the-board ban on dealings with a blocked person, that US persons may not deal with blocked persons wherever they are, and that blocked property must be reported to OFAC within 10 business days. Entities owned 50% or more, in total, by blocked persons are blocked too, even if they are not named on the list.
Why it matters
Sanctions breaches can bring large penalties and can end banking relationships. For products that move money across borders, screening sits in the payment path, so its speed and its false-match handling affect every user.
In a product build
In a payments build, screening is a step in onboarding and in the payment flow, with a hold state, a review screen and a record of each decision.
Common mistakes.
- 01
Screening only at onboarding and not when lists update.
- 02
Exact-match only, which misses spelling variants and transliterations.
- 03
Ignoring ownership, so companies owned by listed people slip through.
Read the official text.
Primary sources this definition is based on.
- OFAC, Specially Designated Nationals and Blocked Persons Listchecked 2026-10-25
- OFAC, Basic information on OFAC and sanctions (FAQs)checked 2026-10-25
Work it out with a tool.
Related terms.
- PEP (politically exposed person)Someone who holds or held a prominent public role, or a family member or close associate of one, treated as higher risk for corruption.
- AML (anti-money laundering)The laws, checks and controls that stop criminals from moving or hiding illegal money through financial services.
- KYB (know your business)Checking a business customer: that it legally exists, who owns and controls it, and how risky it is.
- Travel ruleA rule that requires details of the sender and the recipient to travel with certain transfers of money or crypto-assets between financial institutions.
