How To Remain In Compliance Of OFAC Regulations
Each company has different risks and different tolerances to these risks. For this reason, there is not a single OFAC training program that will work for all companies. However, there are some aspects of an OFAC training program that all companies need.
Foster a Compliance Culture
No matter what, a company needs a compliance culture and management that is committed to the success of the program. By being dedicated, the staff can set the tone for the rest of the organization. There needs to be a culture in which non-compliance is reported. Some organizations attempt to cover up violations and view penalties as the cost of doing business, so this perspective needs to be discarded.
Know the OFAC Sanctions List
Your organization will need to understand what the OFAC sanctions list is. This is the individuals or countries that are targeted by U.S. sanctions. There is the Specifically Designed Nationals (SDN) list, which is a list of targeted individuals. There is also the consolidated sanctions list, which includes all individuals not placed on the SDN list.
Perform a Risk Assessment
For OFAC to be effective, you will need to perform a thorough risk assessment. You will need to look at every aspect of your organization to locate touch-points for contact, directly or indirectly, with sanctioned parties, individuals, governments, and regions. This is especially important when engaging in mergers and acquisitions with companies outside the United States.
Hire an ECO Officer
You will need an employee who is an Export Compliance Officer (ECO), unless your organization is very small. The ECO is responsible for protecting you against risks that could lead to penalties if your organization deals with sanctioned individuals or nations.
He or she should have a direct line to your board of directors and senior management. He or she must be an expert on the regulations that affect your company and must use this knowledge while having full authority on compliance-related matters. Make sure to hire an individual who is experienced in this role.
Train Your Employees
Your employees must undergo training that is never-ending. One of the best ways to make sure that they continue to train is to invest in a learning management software program and having your employees participate in OFAC training programs. Make sure that the ECO is involved in deciding the type of training program that your organization will participate in. With all of these precautions, your organization can avoid penalties.