For those following this subject, Mary Beth and I had an additional question come in today, not on opening accounts, but on selling cashier's checks. Mary Beth - I'm printing your answer here. Good one, too - it'll be in the next BANKERS' HOTLINE!
Q - When a cashier's check is sold, should we be checking the payee's name against the OFAC list? And if we have a hit against the OFAC list, do you have any recommended steps to determine if it is a false positive or an actual hit? I am not sure that the customer who is purchasing the cashier's check could provide enough information to make this decision. Also, if
we determine that it is a match, should we accept the customer's money, issue the check, then block the transaction and not release the check to the purchaser?
A - Let's start with the first question, should you be checking the name? Absolutely yes. The last thing you would need investigators to trace would be a check you sold to one of the terrorists! There are no specific instructions from the FBI, but they have said they want us to check any relationship or transaction. Purchasing a cashier's check is simply one more route
through which money changes hands, and if the payee -- or the remitter -- are on the OFAC list, check to see whether you must reject or block the transaction. On all the recent 27 names added to the list, you must, of course, block.
OFAC keeps saying that if you have what appears to be a "hit" against the list, they would like you to call and they can ask additional questions to ascertain whether or not it is the same person. In FDIC's FIL-87-2001 that was issued September 28, they say that you should direct those questions to OFAC at 800-540-6322.
OFAC appears to work in strange and mysterious ways. They sometimes ask what appear to be totally innocuous questions and then are able to conclude, based upon your responses, whether or not the person is who they are looking for.
If the amount of the cashier's check is between $3,000 and $10,000 and it is being purchased for cash, the information you collect at the time of purchase would be sufficient to answer OFAC's questions. If that is not the kind of purchase it is, then pause while the transaction is in process, excuse yourself to call OFAC, and find out what questions they will need to have answered in order to make the appropriate determination.
Finally, I am sure OFAC would concur that since the transaction is subject to blocking (if the party is the covered party), you should accept the funds, freeze them, and decline to issue the cashier's check. However, there is a new discussion thread on this in the General Discussions area of Bankers' Threads on BOL that you may want to check
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