Step 4 — PEP and sanctions screening
Once all VOI checks are cleared, conduct Politically Exposed Person (PEP) and sanctions screening across every UBO and the entity itself before proceeding to sign-off.
Completing the screening in SBOS
- Within the CDD run, open the PEP & Sanctions section.
- For each UBO and the entity, select Run screening (third-party) or Record manual check.
- Record the date of the check, the source(s) checked, and the outcome — clear, match, or inconclusive.
- For any match, document the nature of the match and the action taken or proposed.
- Mark each subject as Cleared once resolved.
- Advance to Step 5 — Sign-off once all subjects are cleared.
Confirmed sanctions match — hard stop
A confirmed hit against the DFAT sanctions list is a hard stop. Do not proceed with onboarding or any further steps. Escalate immediately to your compliance officer and seek legal advice before taking any action in relation to the client or the transaction. Tipping-off obligations under the AML/CTF Act apply.
Inconclusive results
Where a screening result is inconclusive — a possible name match but insufficient detail to confirm or rule out — document your investigation steps and the basis for your conclusion before marking the subject as cleared.
What needs to be screened
This process requires that the entity and all UBOs are screened against:
- DFAT sanctions list for Australian sanctions administered by the Department of Foreign Affairs and Trade
- PEP records for domestic, international, and foreign politically exposed persons and their close associates
- Adverse media for negative news coverage, regulatory actions, and enforcement history
Screening methods
This process can be completed:
- Manually: Practitioner conducts searches and records the outcome and date directly in the CDD run
- By a third-party provider: Automated screening via the connected provider (where enabled). Results are imported and attached to the run automatically.
PEP categories
| Category | Definition |
|---|---|
| Domestic PEP | A person who holds or has held a prominent public function in Australia — e.g. senior government official, judicial officer, military commander |
| International PEP | Equivalent roles held in a foreign country |
| Foreign PEP | A person entrusted with a prominent function by a foreign country, including heads of state and senior executives of state-owned enterprises |
| Associated persons | Immediate family members and close business associates of any of the above |
A positive PEP match does not automatically prevent onboarding, but it escalates the matter to Enhanced Due Diligence and typically requires senior management approval before sign-off. The nature of the PEP relationship and the steps taken must be documented.