The Office of Foreign Assets Control requires payors to check payees against a database of which of the following?

The Office of Foreign Assets Control requires payors to check payees against a database of which of the following?

• A. Policyholders of other insurers.
• B. Those who have collected a payment for the same loss.
• C. Known terrorists and drug traffickers.
• D. Known perpetrators of insurance fraud.

Answer: (C)

OFAC screening is about preventing payments from going to sanctioned parties. Payors must verify each payee against the U.S. Treasury’s sanctions lists before issuing funds. Those lists identify individuals and entities, including known terrorists and drug traffickers, that are blocked or restricted from financial transactions. Checking payees against this database helps ensure that insurance payments don’t flow to people the government has prohibited from receiving funds, avoiding penalties and legal risk for the company. The other options don’t reflect the purpose of OFAC: they describe unrelated groups that aren’t the sanctioned-party database OFAC maintains.

OFAC screening is about preventing payments from going to sanctioned parties. Payors must verify each payee against the U.S. Treasury’s sanctions lists before issuing funds. Those lists identify individuals and entities, including known terrorists and drug traffickers, that are blocked or restricted from financial transactions. Checking payees against this database helps ensure that insurance payments don’t flow to people the government has prohibited from receiving funds, avoiding penalties and legal risk for the company. The other options don’t reflect the purpose of OFAC: they describe unrelated groups that aren’t the sanctioned-party database OFAC maintains.