The process of screening information collected and maintained by an LFI on the parties it does business with and their related parties is referred to as “name screening”. The concept encompasses any data set within the LFI’s operations, separate from its transaction records, that may present a relevant sanctions risk indicator or be conducive to detection through screening on a periodic basis and prior to entering into a customer relationship. The process of screening a movement of value—including funds, goods, or assets— out of, into, or through the LFI between parties or accounts is referred to as “transaction screening”.

Where automated systems are employed, LFIs should perform pre-implementation testing of sanctions screening systems, using historical transaction data as appropriate. Such testing should include system integration testing to ensure compatibility of the sanctions screening system with source systems and other sanctions compliance infrastructure and user acceptance testing to ensure that the system performs as anticipated in the operating environment. Material data mapping, transaction coding, and other data quality issues, as well as irregularities in sanctions screening model performance and outputs, identified through pre-implementation testing should be prioritized for remediation and subject to re-testing prior to the deployment of a sanctions screening system.

The following sections provide additional detail about system design and pre-implementation testing as these relate specifically to name screening and transaction screening processes respectively.