The Electronic Payments Network (EPN), the ACH business of The Clearing House Payments Company L.L.C, today announced the industry's first centralized OFAC screening solution for financial institutions originating and receiving cross-border ACH transactions.
EPN's Centralized OFAC Screening Service is a web-based solution that requires no custom software installation or individual maintenance. It provides financial institutions with an easy solution to fulfill their compliance requirements for cross-border ACH transactions under regulations issued by the U.S. Treasury Department's Office of Foreign Assets Control (OFAC). OFAC Screening is available to all financial institutions in the United States.
"EPN's OFAC Screening provides a cost-effective solution for financial institutions of all sizes to manage their cross-border ACH traffic," said Rossana Salaris, Senior Vice President of The Clearing House, responsible for EPN.
EPN's OFAC solution is part of EPNWATCH, a suite of risk-management services from EPN that includes fraud detection, employee fingerprinting, credit and debit controls, and the Universal Payment Identification Code (UPIC).
Built in partnership with Accuity (formerly TFP, Thomson Financial Publishing), EPN's OFAC solution screens cross-border corporate and retail ACH payments against a centralized OFAC list and identifies suspect transactions. The centralized architecture of EPN's OFAC solution allows institutions to avoid the expense of building and maintaining their own OFAC screening infrastructure and tools.
"If a financial institution does not block and report a cross-border ACH transfer and another financial institution does, then it may face civil or even criminal penalties," Salaris said.
How EPN's OFAC Screening Works
Origination
Originated cross-border transactions are sent to EPN in files, which can include NACHA Corporate Cross-Border Payments (CBR) and Consumer Cross-Border Payments (PBR), SWIFT MT103 messages and proprietary cross-border formats. EPN screens the submitted transactions in real-time against the OFAC list, which contains the names of individuals, countries, companies, vessels and other entities that are identified on the Specially Designated Nationals (SDN) list. A report of suspect items is generated. An e-mail directs the financial institution to a secure web interface to view and resolve each suspect transaction. Accounts identified as false positives can be added to the financial institution's database to reduce future false positives.
Receipt
EPN screens all CBR and PBR items it receives from FedACH against the OFAC list. A report is generated for the receiving institution to warn them of suspect transactions. The e-mail notification directs the institution to a secure web interface to view and resolve each suspect transaction. Accounts identified as false positives can be added to the financial institution's database to reduce future false positives.