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Sanctions “False Positives”, Proliferation and Trade-Based Money Laundering

Wednesday, 25 January 2017

The Customs and Excise Division of the Treasury has published guidance on the treatment of “false positive” matches when using screening software or other checks of client and account databases to detect persons or entities subject to UN or EU sanctions.  A false positive is where there is an apparent match to a target on a sanctions list where, after further investigation, it is decided that they are not, in fact, the designated target of the sanctions.

An amendment to Sanctions Notice 26, which provides general information about the various sanctions regimes, makes it clear that a business should have a process detailing how it carries out checks to confirm or treat a match as a false positive, and maintain a record of any false positives as well as the records of actual matches, attempted transactions etc.

Another amendment to Sanctions Notice 26 also makes it clear that a business is expected to maintain records of any potential and actual matches to names on sanctions lists, including false positives.

The Treasury would also like to remind businesses that there are on the Customs and Excise webpages, alongside Notices dealing with sanctions matters, the following Public Notices that they may find useful –

  • Notice 1000 MAN on trade-based money laundering
  • Notice 1008 MAN on proliferation and proliferation financing.

As with the Sanctions Notices, it is intended that these two Notices will be amended from time to time to provide further information, including on trends, typologies etc, that may prove useful.

Other Notices and information about sanctions and export controls can be found on the Customs and Excise webpages.

For more information contact Customs and Excise.

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