A sanctions check is the process of checking or screening various global sanctions lists to ensure that the customer isn’t sanctioned. Regulated businesses, such as banks, must conduct such checks to ensure that all their potential customers (both individuals and other companies) don’t have any ties to sanctions against them. The goal is to check clients against official lists of sanctioned parties from governments or international organizations, reducing financial and legal risks.
Sanctions checks are part of a compliance process required by Anti-Money Laundering (AML) and counter-terrorist financing (CTF) laws. By screening these lists, companies aim to prevent partnering with dangerous entities, such as those involved in illegal activities like terrorism, drug trafficking, or human rights abuses. This makes the sanctions screening a number one defense against individuals and entities or countries considered a risk to peace and national security.