BSA/AML Examiner School Case Study

Internal Use Only

Recordkeeping and Record Retention The Bank will keep a full and accurate record of each transaction engaged in sanctioned countries and entities regardless of whether such transaction is effected pursuant to license for five years after the date of such transaction. The BSA/OFAC must ensure that the Bank keep a full and accurate record of each blocked or rejected transaction for at least 5 years after the date of the transaction. For blocked property, records must be maintained for the period the property is blocked and for five years after the date the property is unblocked. The Bank will also maintain copies of customers' OFAC licenses to initiate a legal transaction for a minimum of 5 years, following the most recent transaction conducted in accordance with the license. Wire Transfers Department Procedures Wire Transfers During new wire input Kentucky Bankers Bank OFAC Tracking System will automatically scan the customers' information against the OFAC List. Kentucky Bankers Bank OFAC Tracking System automatically prompts message to the wire transfer clerk when a possible match is encountered during the wire transfer input processing. The wire transfer clerk must thoroughly review all the OFAC names prompted Kentucky Bankers Bank OFAC Tracking System for possible matches. For Outgoing we must check: • The originator of the wire (our customer); • The beneficiary/receiving bank (bank receiving wire); • The beneficiary (individual or company receiving credit from the wire we are sending). For Incoming we must check: • The originator of the wire (the name of the person sending the wire to our customer); • The originating/sending bank (bank receiving wire); • The beneficiary (our customer). After inquiring on the above-mentioned, the wire transfer clerk will initial and record the results to the wire transfer request form. If there is a match on the OFAC list to any one of the above mentioned inquiries, the wire transfer clerk will notify the OFAC compliance officer immediately and will not proceed to process the wire. The OFAC compliance officer will then call the Office of Foreign Assets Control at (800) 540-6322 for clarification and confirmation of the match. If the inquiry is not a positive match, the OFAC compliance officer will then instruct the wire transfer clerk to proceed in processing the wire transfer request. If the inquiry is a positive match, the OFAC compliance officer will follow the instructions given by the Office of Foreign Assets Control and will freeze the assets until further notified. A wire transfer cannot be cancelled or amended after the Bank has received it. Once assets are blocked, we will release them only by specific authorization from the U.S. Treasury. We will report all blocks to OFAC within 10 days of occurrence. If the OFAC compliance officer or BSA department personnel is not available at the time a positive match is obtained, the wire transfer clerk under the direction of a Senior Management will then call the Office of Foreign Assets Control for clarification and confirmation of the match and proceed as instructed. The wire transfer clerk will notify the OFAC compliance officer of the results of the match as soon as deemed possible.

For Training Purposes Only

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