Last year a Third Circuit court opinion highlighted the imperfection of OFAC SDN List check programs. In Cortez v. Trans Union, LLC, an innocent consumer was denied purchasing an automobile because her credit report indicated she was on a list of Specially Designated Nationals (SDN) with whom U.S. persons were prohibited from transacting with. The credit report utilized a program entitled OFAC Advisor that confused the consumer, Sandra Cortez’s name, with someone who actually was blocked on the SDN List.

Regular readers of this blog, know that placement on the SDN list is the result of engaging in activity that is prohibited by one of the numerous executive orders setting forth the sanctions programs administered by the United States Department of the Treasury Office of Foreign Assets Control (OFAC). Placement on the OFAC SDN list can have a dramatic impact on one’s life, particularly if that person is in the United States, as it effectively prohibits parties from engaging in any type of transactions with them. For example, a designated party in the U.S. would not be able to use a bank account, pay rent, or even buy food.

There are a number of products on the market such as the one employed by the credit reporting agencyin this case. Many of these products are highly susceptible to mistakes as they take into account only the parties’ names. Many of the names found on the OFAC SDN list are common names such as Mohammed, Ali, Rodriguez, Cortez, etc. As such, these products have been known to erroneously identify someone as an SDN when in reality that person only has an identical or similar name to an SDN. This is a problem that I hear about from potential clients from time to time.

If you know your name is similar to someone’s who appears on the SDN List, then you should contact an attorney who is familiar with OFAC processes and develop a strategy to prevent what occurred to Sandra Cortez from happening to you. Being proactive in this regard can save you many headaches in the future.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC litigation. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.