How to handle a sanctions screening false positive
A screening false positive is fixed by investigating, documenting the comparison, and dismissing only when the counterparty clearly differs from the SDN entry.
TL;DR
TL;DR: Investigate, document, and dismiss. Compare the counterparty details against the SDN entry, and if they are clearly different, close the case with a written note.
What a false positive looks like
Screening tools match names and addresses against the Specially Designated Nationals and Blocked Persons List, and common names frequently collide with a listed entry. A false positive means the flagged counterparty is not actually the designated person. Do not auto-dismiss it: a real match among lookalikes is exactly how violations happen under OFAC strict liability, where intent is not required.
How to investigate
Compare the fields that matter: full name, date of birth, location, and wallet address. If the counterparty differs on multiple identifying fields from the SDN entry, it is likely a false positive. sanctionsai.dev provides the sanctions_check tool for the initial match and risk_score to weigh a borderline case, returning clean (ALLOW) or flagged (BLOCK) in under 100 ms.
How to document and close
- Record the SDN entry you matched against and the fields you compared.
- State clearly why the counterparty is not the designated person.
- Keep the note and the screening log together for audit or regulator review.
A dismissed false positive needs a paper trail as strong as a blocked match.
The goal is a decision a regulator can reproduce: same input, same comparison, same documented reason for dismissal.