Sanctions screening compares the names in a file with the lists of persons and entities subject to financial sanctions. In Hong Kong, United Nations Security Council sanctions take effect through regulations made under the United Nations Sanctions Ordinance (Cap. 537), and terrorist designations through the United Nations (Anti-Terrorism Measures) Ordinance (Cap. 575). Dealing with the funds of a designated person is an offence, so the check is a legal control and not only a risk measure. Firms with exposure elsewhere also screen against the lists of the places they operate in or settle through.
The HKMA's guideline asks a bank to screen customers, their beneficial owners and connected parties when the relationship starts, when the lists change and on an ongoing basis, and to keep a record of the screening and of how matches were resolved. Most matches are false: a common name on a list is not the customer, and the file must show why.
Why it matters
A screen is only as good as the names it is fed. Screening the company and missing the director who signs for it, or the shareholder two layers up, leaves the exposure in place. Translated and transliterated names from Mainland China add a second difficulty.
How Fill Easy relates to it
CorpVerify returns the names that need screening: directors, shareholders and traced owners, in English with the original script kept. GovVerify can add sanctions and watchlist screening to the same identity request for all four schemes, and Mainland background and watchlist checks return with the rest of the file.