Lost in the Lists?
Jun. 2016
TradeSecure

Several US government agencies have “lists” to identify individuals or entities whose behavior conflicts with US trade and security interests. Although these lists vary by focus and government agency, they all share a common theme: conducting business with listed parties carries real risk. Navigating these extensive lists poses a difficult and time consuming task. TradeSecure can facilitate understanding and help you unlock the lists’ risk mitigation potential.

Know Your Lists

Government Agencies Overview

Smart Screening

Due diligence is essential to verifying compliance with all US government lists. Businesses need to determine the status of their customer or business partner with each of the government agencies involved in imposing sanctions. Actively screening these entities and individuals, using available search tools, can help avoid accidental violations and unforeseen penalties.

There are nearly 20,500 persons or entities named on these nine key lists. In order to reduce the risk of exporting to listed parties, businesses can use Commerce’s Consolidated Screening List search engine for reference and screening. In addition, OFAC’s search tool can be used to identify parties on the Specially Designated Nationals List (SDN). This tool also includes OFAC’s Non-SDN Iran Sanctions Act list (Part 541 List), which is not included in the Consolidated Screening List.

BIS has also published a list of Red Flag Indicators for new customer engagements to prevent companies from unknowingly doing business with a denied person or entity. Beyond checking the customer’s name and address against the list of Denied Persons, BIS stresses monitoring for suspicious behavior, such as: not offering end-user information, having little or no business background, paying in cash, being unfamiliar with the product, or special requests regarding delivery of the product. Businesses should be wary of companies who refuse maintenance on the item, request an abnormal shipping route or unorthodox packaging, or provide vague delivery dates. Companies should also refrain from shipping products that seem above the general technical level of the recipient country and should question shipping an item to a company with an unrelated focus. These risk management tactics can be applied to all government lists. Moreover, questions or possible violations can be directed to the US Department of Commerce.

Smart firms will use these lists to their advantage for effective risk management. Despite the overwhelming entries and numbers of the lists, it can be done. Advisory groups like TradeSecure can help companies harness such information to use in their compliance programs, to avoid penalties, and to ensure safety and security of their operations.

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