On 21 October 2015, OFAC published new guidance on the use and maintenance of “false hit” lists. False hit lists are lists of individuals or entities who have been flagged by sanctions screening systems but are determined after manual review not to present sanctions compliance problems. The lists are used to suppress repeated alerts generated by screening software.
OFAC recognised that false hit lists are a legitimate tool but cautioned banks and others to take steps to ensure the accuracy of such lists. The measures recommended by OFAC include (1) involving compliance personnel in developing guidelines for the use and oversight of the lists, which should include periodic reviews of the lists, (2) ensuring that existing false hit lists do not override matches resulting from new additions to OFAC’s sanctions lists, (3) amending the false hit lists in response to updates to OFAC’s sanctions programmes, such as revocation of general licences, and (4) requiring that significant changes to customer information (such as changes in name, address or ownership) trigger appropriate review.