OFAC Sanctions Screening

The Office of Foreign Assets Control administers and enforces U.S. economic sanctions. Screening customers, employees, and counterparties against OFAC lists is a near-universal procurement requirement.

OFAC scope

The Office of Foreign Assets Control (OFAC) sits within the U.S. Treasury and administers economic and trade sanctions programs based on U.S. foreign policy and national security goals. Its core tool is the Specially Designated Nationals and Blocked Persons (SDN) List, but it also maintains program-specific lists (Sectoral Sanctions Identifications, Foreign Sanctions Evaders, Non-SDN Menu-Based Sanctions, and others) and full-country sanctions programs (Cuba, Iran, North Korea, Syria, certain regions of Ukraine, etc.).

Why OFAC matters for AI vendors

U.S. persons (including U.S. companies and their foreign branches) are prohibited from transacting with SDNs or with parties in fully-sanctioned jurisdictions. AI vendors selling to enterprise buyers will routinely be asked to certify OFAC compliance: that they screen their customer base, employees, and key counterparties against OFAC lists at onboarding and on an ongoing basis. Failure to screen can result in strict-liability civil penalties — OFAC has issued multi-million-dollar settlements with technology companies for sanctioned-party access to services.

Practical implementation

Mature AI vendors integrate OFAC screening into customer onboarding (KYB), payment processing, and access control flows. Screening can be done in-house using OFAC's SDN search tool (which is free) or through third-party providers (LexisNexis, Refinitiv, Dow Jones, ComplyAdvantage). Common diligence questions: how frequently are lists refreshed, what is the false-positive handling process, do you screen against EU and UN consolidated lists in addition to OFAC, and what is your blocked-transaction reporting process to OFAC.