Use Case

Making a New Payment to a Third Party

Transferring Money to a Third Party for the First Time comes with Certain Risks

Transferring funds to unknown third parties is always going to be complicated for both the financial institution and the receiver. In many cases, only basis information is available, making proper due diligence difficult to achieve. These kinds of payments happen frequently in banks on a daily basis, but also to suppliers, other business partners, or when handling claims.

 

All parties want a transaction to be processed as quickly and easily as possible. However, complying with sanctions regulations is essential, and cannot be ignored. These regulations impose a severe business risk to all parties. With foreign payments for example, risk is exacerbated through the secondary sanctions regime issued by the Department of the Treasury’s Office of Foreign Assets Control (OFAC). In case of a violation, the company violating law risks becoming fined heavily by US authorities.

Manage Complex Sanctions Rules Imposed by US Authorities and others

Financial institutions typically go through the process of identifying and verifying the identity of the client first and foremost. At this point they classify each client into risk categories. They might then deny business for specific reasons or even contact their respective Financial Intelligence Unit (FIU).

 

Many of these kinds of checks can be in-built into on-premises or legacy systems, locking financial institutions into one way of working. It can be impossible to amend or improve these processes, or cause a lot of manual effort and heavy resource requirements. When changes or updates are attempted, these can take months or even years, and divert budget from other essential areas. Because of this, management often decides to stick to ‘the devil we know’ rather than attempt to make any positive change.

Create a Sophisticated, Secure and Simplified Workflow for Payment Checks in Minutes

Through B-Trust, it takes 10 minutes and no knowledge of coding to set up a TrustFlow to meet this challenge. We use the App Corporate Structure Connector to retrieve beneficial owners and the entire corporate structure tree from any third party provider, and forward that dataset to Sanctions Screening Connector which runs it against selected sanctions lists such as those imposed by OFAC, the EU and UN. In case of one or more hits, the entire data set goes to the OFAC50-Check App to check if potentially sanctioned parties in the structure would also trigger OFAC’s 50% rule. Potential violations create alerts in the Case Management Tool and can be easily reviewed by experts.

 

This whole flow is an automated process, is simple to set up, and reduces the transaction checks time to under 3 minutes, running in real-time.

The Key Benefits

One end-to-end tool for multiple data sources

Automated checks of comprehensive regulatory requirements

Designed and optimized by sanctions experts

Straightforward no-code set up

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