Responsibility for detecting OFAC red flags lies primarily with the compliance officers and operational staff within financial institutions. Employees must be trained to recognize signs of potentially prohibited transactions. Red flags can include unusual transaction patterns, involvement of high-risk jurisdictions, or names that match the SDN list. Institutions often implement automated screening systems to assist personnel in identifying potential matches. Compliance teams must investigate these alerts, determine their validity, and take appropriate action. Failure to properly identify or report OFAC red flags can result in enforcement actions against both the organization and individual employees.
