Vessels are a part of the OFAC SDN and EU lists that continue to cause difficulties with efficiency, so lets have a deeper look into the vessels and what significance they have.
There are currently (November 2019) 37 vessel names on the EU list, and 549 vessel names on the OFAC SDN list, clearly OFAC is far more active in vessels, and will be the focus of our attention in this article. The vessels are split by program groups thus:
There are more vessel names than actual vessel on the list because vessel names change frequently, often more frequently than OFAC changes its list, so beware that many names are now historic, and the vessel you are dealing with maybe going by a new name specific for its interaction with you.
So the names are on the list, so I screen them right? Well not necessarily, there are lots of things on the list and we need to take a risk based approach to what and how we screen them. The trouble with vessels, and why we would want to avoid screening them if we can, is that they are often close to personal and business names, and once upon a time – ZAR – the South African currency code.
Fortunately we no longer have to cope with the vessel ZAR, it has been delisted, but we do have:
Hermann, Bella, Patriot, Alert, Alpha, Amber, Christina, Dan, Danesh, Daniel, Devon, Hilda 1, Lena, Maria III, Daisy, Jasmine and many others.
The decision on whether to screen vessels or not depends on how vessels relate to your business. If your business relates to issuing credit cards, then it seems extremely unlikely that a vessel is going to sail into a branch and start filling out an application form.
So where do vessels come into play? For Financial Institutions in the following ways:
- Trade Finance – vessels carry goods
- Asset Finance – people use finance to buy vessels
- Commercial Insurance – companies insure their boats, yes even the ones in Iran
If you are a business that is involved directly with vessels, such as a port, or a re-fitter, then you will have further specific screening requirements for your business.
- Screen the vessels you identify in trade finance against vessel names
- Screen the vessels you identify in asset finance against vessel names
- Screen the vessels you insure against vessel names
- Don’t screen anything else against vessel names as you will be wasting your time.
If you insist on screening your SWIFT payments for vessel names, then you may want to take the following advice:
- Do not screen the payment remitter – vessels cannot send payments
- Do not screen the beneficiary – vessel don’t receive payment
- Screen the narrative information on the payment (Tag 70 and 72 for an MT 103), if you want to further refine your screening only screen the narrative when it includes a keyword such as “vessel” or “ship” or “cargo”.
Note that if you are screening for vessels, then you need to screen in a different way than for individuals and companies. Vessels have their own noise words. You might be used to configuring noise words such as “LTD” and “Limitada” for your entities, but vessels will have noise words such as “GTS”, “MS”, or even “LPG/C”. Also vessels often have roman numerals at the end of their name so be prepared to make matches such as “Maria III” vs “Maria 3”.
Every vessel – well barring small and military vessels – has an IMO Number, this is a unique identifier for the superstructure of the vessel, and it doesn’t change through the lifetime of the vessel. The IMO Number is normally given on the OFAC SDN list and can also be used for screening. As it is a 7 digit number it doesn’t tend to generate many false positives.
For some vessels OFAC does identify a vessel owner, this is of some significance for screening as a payment to a vessel owner could well be for services relating to that vessel.
In some cases the vessel owner is also a sanctioned entity in itself, but not always.
The following vessel owners are on the OFAC SDN list:
- Compania Navegacion Golfo S.A. – Not an SDN itself
- Samir de Navegacion S.A. – Not an SDN itself
- Sand & Swan Navigation Co. Ltd. – Not an SDN itself
- Beratex Group Limited – listed as an SDN
- NITC – listed as an SDN
I would advise anyone to check if they are screening against the vessel owners above if they are involved in trade or asset finance.
At SQA Consulting we can not only give you hints and tips on screening effectively and data management, we are leaders in measuring the effectiveness and efficiency of screening. Please contact us to find out more about this article, or download our brochure here.