Sanctions Screening Best Practices Every Compliance Team Should Know

If your organization deals with international trade, finance, or cross-border partnerships, sanctions screening isn’t optional it’s critical. Missing a match on a sanctions list, a PEP list, or a denied party list could mean serious legal and reputational consequences. That’s why having a solid process for sanctions compliance is a business necessity.

In this blog, we’ll break down the most important sanctions screening best practices compliance teams should keep in mind, whether you're just setting up your program or refining an existing one.

1. Know the Lists You Need to Screen Against

Start with the basics: understanding which lists your business should be screening. Common ones include:

• OFAC sanctions lists (like the SDN List)

• EU Consolidated List

• UN Sanctions List

• Country-specific watchlists

• PEP (Politically Exposed Persons) lists

• Denied party lists

• Restricted party lists

But these aren’t one-size-fits-all. Your screening should align with the jurisdictions you operate in and the types of transactions you handle. If your business works with high-risk regions or industries, your scope will need to be broader.

To make this easier, many companies refer to real-time global watchlists and sanctioned country indices to ensure they’re not missing anything. You can refer to our Department of Commerce, US Sanctions Index for an up-to-date view of restricted entities and export control lists issued by the U.S. government.

2. Keep Your Data and Lists Fresh

Sanctions lists are dynamic — individuals and entities can be added, removed, or modified without notice. That’s why your screening solution must stay current, ideally with real-time or daily updates. Relying on outdated data exposes your business to compliance gaps.

In our blog on The Importance of Sanctions Screening in Global Supply Chains, we explain how staying updated isn’t just about avoiding penalties, it's about protecting your supply chain from hidden risks. Trademo’s Sanctions Screener ensures you’re always screening against the latest data from over 3,000 sanctioning authorities, including OFAC, the EU, and more.

3. Prioritize Accurate Name Matching

One of the trickiest parts of sanctions screening is name matching. A small typo, different language format, or extra space can mean a missed match. At the same time, you want to avoid wasting time on false positives.

This is where fuzzy matching, phonetic algorithms, and context-aware AI models can make a real difference. Modern sanctions screening software should be able to pick up variations in spelling and formatting while still reducing noise.

If your current screening process is flagging too many false positives or missing risky entities, it may be time to revisit your matching logic.

4. Don’t Overlook PEPs and Close Associates

Politically Exposed Persons (PEPs) carry a higher risk of corruption due to their roles and influence. It’s important to screen not only the PEPs themselves but also their family members and close associates as part of your AML and KYC processes.

While PEPs may not always appear on a sanctions list, they are frequently mentioned in adverse media or may be indirectly linked to sanctioned entities. That’s why your screening tool should include comprehensive PEP list coverage with robust flagging mechanisms.

To stay updated on entities currently sanctioned and enforcement actions especially in high-risk regions like Russia you can refer to our Sanctions Against Russia Index. It provides a centralized view of government-issued advisories, active sanctions, and compliance trends tied to Russian entities.

5. Integrate Screening Across the Customer Journey

Sanctions checks shouldn’t just be a one-time onboarding activity. High-performing compliance teams embed sanctions screening at key touchpoints such as:

• Customer onboarding

• Transaction processing

• Supplier vetting

• Periodic reviews or refresh cycles

Make sure your tools integrate with CRM, ERP, and procurement platforms so that you can automate these checks without slowing down operations.

6. Keep an Audit Trail

Regulators expect more than just good intentions. You need to be able to prove that you screened an individual or entity, when you did it, and what the outcome was. Your sanctions screening system should maintain a clear audit trail with time-stamped logs of every screening event, match decision, and escalation.

7. Train Your Team — Not Just the Tool

Even the best technology can’t replace a well-trained team. Make sure your compliance officers and analysts understand:

• How the screening system works

• What sanctions compliance means legally

• How to handle true matches vs. false positives

• When and how to escalate

Training is especially critical when dealing with restricted parties or complex corporate structures that may obscure ownership and control.

Summary

Sanctions compliance is no longer just about checking boxes but it’s about proactive risk management. With growing regulatory pressure and increased enforcement, organizations need more than spreadsheets or manual checks to stay safe. That’s why it's essential to understand why regular sanctions screening matters for your business not just to stay compliant, but to protect your operations from hidden threats.

Using an advanced tool like Trademo Sanctions Screener allows your team to screen against global watchlists, OFAC data, denied party lists, PEPs, and more all with intelligent name matching and a built-in audit trail.

Don’t wait for a red flag to get serious about compliance. Build your foundation now with these sanctions screening best practices and stay ahead of the risk.