OFAC

[texaslp]

Does anyone have any information on whether or not we are required to check our customers against the OFAC lists?

[Batty]

An OFAC search is required for all vehicle transactions whether they are "cash" or "financed" deals. At the stores that I represent, the search is completed via the credit report. It will detail if there is a match found. There are several other companies out there that will also perform OFAC searches.

We have a written policy on OFAC searches, which includes instructions on how to determine if an OFAC match is a true match, and what to do if it is.

So far we have only had one true match. The FBI was in the dealership within 10 minutes.

Additional information can be found at http://www.fincen.gov

Hope this helps!

[Lhansen]

Batty:
Would you be able to provide more insight into your dealer groups policy regarding this?
I've spoken with several GM's and their comments have been "We've heard something about this." I'd like to become more informed about the ruling and what all is involved.
Thanks!

Linda


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Linda Graham Hansen
Auto Dealer Focus www.autodealerfocus.com

[This message has been edited by Lhansen (edited 07-12-2006).]

[texaslp]

I spoke to someone in legal @NADA and here's the deal. Every business in the US is prohibited from doing business with anyone on the designated list. However, she said they are not auditing businesses to see if you are checking the list. She said ea business needs to do a test of reasonableness. The problem will come in if you sell something to someone on the list and they use it to perform an act of terrorism and it is traced back to your store. So, her example was how likely is it that someone will go in to Starbucks, purchase a cup of coffee and somehow use that to committ an act of terrorism. So some people are saying you need to check every parts and service customer, probably not necessary.

Technically you are only required to check the list on someone you have a transaction with. However for .25ea you can have it automatically checked on every credit bureau
and not worry that someone may forget to run it. BUT, also remember to check cash customers as well.

[Lhansen]

Thanks! Good information.

Linda

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Linda Graham Hansen
Auto Dealer Focus
www.autodealerfocus.com

[Matt Parsons]

Yes, it is my experience that this is one of those scenarios where you need to build a process to insure all your vehicle purchases are checked. The best way to do that is to probably subscribe to the OFAC check through the Credit Bureau process. The fee is small and although the risk of you being 'caught' in a problem is probably small as well, I don't think any of us could afford to be part of a terrorist act knowing we could of helped to prevent it.

[ascaravan]

OFAC is the Office of Foreign Assets and Control. The easiest way to safeguard against this would be to have it done straight through your credit report system. If anyone is interested I currently have a system at the dealership that screens the OFAC for them.

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Ascaravan

[Matt Parsons]

OFAC is a feature that you can purchase when you do a credit bureau pull with the major providers. This is typically a seperate line item charge and can vary by provider. This is a good way to insure you are 'checking' at least those individuals that are purchasing a vehicle from you. Keep in mind however, if the person does not allow you to run a credit bureau on them does not eliminate your obligation to have checked the list.

[This message has been edited by Matt Parsons (edited 08-21-2006).]

[zekensted]

So what is the best way to check OFAC for someone paying cash, and no credit check is appropriate?

[texaslp]

You can view the list on the OFAC web-site, or you can explain to your cash customer about OFAC and ask for permission to run the bureau.

If you know the customer and have absolutly no reason to believe they would be on the list, I wouldn't worry about it.