What is a Restricted or Denied Parties Screening?

 

Governments about the world want to ensure that organizations know their business partners. Observing these vast commercial networks in order to publicly designate criminal and terrorist groups takes the vast resources of national governments and international organizations such as the United Nations and the World Bank.

 

Authorized individuals, vessels, companies, entities and charities are published on sanctions lists and restricted or denied parties lists. These lists often identify the name, address, alias’ used and sometimes personal information such as date of birth. Companies, insurance and financial industry partners utilize these various lists as part of their trade compliance operation. The restricted lists are compared or screened against an organization’s business partners, suppliers, vendors, and customers to identify potential risks of inadvertently conducting business with debarred parties. The terms: restricted; sanctioned; denied; and debarred are often used interchangeably when speaking of these many various lists.

 

Due to trade compliance desires, the partners involved in all cross-border trade transactions must experience screening. Any parties or transactions flagged by an active sanction list will need to be investigated further. During the additional due diligence process organizations may find that a transaction partner is subject to a strict export ban, license requirement, or further evaluation of the end-use.

 

All companies are required to have a process to identify and manage red flags arising out of the due assiduousness process and companies exporting controlled products and technology are required to have sophisticated Know Your Customer (KYC) processes.

 

How to avoid Restricted Parties Screening

 

All list publishing organizations Denied or Restricted Parties from a sanctions list when necessary to meet their Global Trade Management and foreign policy objectives. The names and addresses of additions and removals are regularly updated in the sanctions list as well as the denied or restricted party lists. These lists are made available by the government in three ways: an open API, downloadable CSV, and a manual search engine. A Programming interface, specifically, empowers firms to include information into a dashboard for ongoing exchange observing. Others may collaborate with third-party service providers to create lists-incorporating tools.

 

The KYC guidance, which provides specific controls for identifying and avoiding restricted individuals, must be understood by businesses.

 

A KYC program's most important considerations include:

Learn about "Red Flag Indicators" that indicate potential wrongdoing, such as:

 

Cash payments for big-ticket items with no clear purpose Freight forwarders listed as the final destination with little or no business history Screen all parties involved in a transaction—including freight forwarders, consignees, etc.— against the sanctions list and the party lists that are Denied Parties Screening. If you think an export transaction might be against the law, tell your director of internal trade compliance. Always look for red flags and let management know if there are any irregularities that affect trade compliance.