Denied Party Digest

Valuable information about denied party screening

American Express Travel Cited for Screening Violation

Today, April 30, 2020, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued a "Finding of Violation" to American Express Travel Related Services.

Due to a combination of human error and screening defects, American Express approved an American Express GlobalTravel Card for Gerhard Wisser, a Specially Designated National (SDN).  This was despite Wisser being flagged by the screening system as a potential SDN match.  Wisser was able to use the card for 39 transactions totaling approximately  $17,655.17 between March and May 2015 in Germany and the United Arab Emirates.

OFAC identified the following as aggravating factors:

  • The economic benefit to the SDN;
  • That American Express is a large, commercially sophisticated financial institution; and
  • "Automatic approval of applications in instances where the risk engine led to a system timeout was a critical shortcoming of its compliance program."

However, OFAC issued a Finding of Violation with no monetary penalty in light of the mitigating factors:

  • No willful or reckless behavior;
  • No indication that American Express knew it maintained a card for an SDN or that its system could be overridden;
  • Remediation makes it less likely that similar violations will recur;
  • Voluntary disclosure and cooperation with OFAC's investigation; and
  • No penalty notice or Finding of Violation in the five years before the earliest transaction.

This case again brings up the importance of thorough screening and prompt disclosures.  While American Express was able to avoid a monetary penalty, they still had to go through the OFAC investigation and are now on record with a Finding of Violation--the previous lack of which was considered a mitigating factor in this case.

Click here to read the full Finding of Violation.