OFAC compliance refers to the measures organizations take to adhere to U.S. sanctions regulations. This includes screening clients, counterparties, and transactions against OFAC lists, such as the SDN list. Organizations must implement internal policies, employee training, and recordkeeping procedures to ensure ongoing compliance. OFAC compliance also involves reporting blocked or rejected transactions to the relevant authorities. Financial institutions are required to conduct periodic audits and reviews of their compliance programs. Effective OFAC compliance reduces the risk of legal penalties and helps maintain the institution’s reputation.
