Sanctions screening compares individuals and organisations against applicable sanctions lists and asset freezing decisions. PEP screening supports risk-based review by identifying politically exposed persons and, where applicable, their close circles. Corporate relationship analysis, on the other hand, shows the shareholding, management and other recorded connections between individuals and companies. The first two checks look up status on lists; relationship analysis explains how these individuals and companies are connected to one another.
The Difference Between Sanctions Screening, PEP Screening and Relationship Analysis
| Check | Question it answers | Data it examines | Output it provides |
|---|---|---|---|
| Sanctions screening | Does the individual or organisation appear on an applicable sanctions list or in an asset freezing decision? | National and international sanctions sources and official decisions | Potential matches to review, with source and record details |
| PEP screening | Is the person politically exposed; is there a relevant family or business connection under the applicable rules? | PEP sources and identity/role information | Status and match information supporting risk-based customer review |
| Corporate relationship analysis | Through which shareholding, management or registry connections are individuals and companies linked? | Trade registry and other corporate records | Relationship network, connection path and record history |
What Is Sanctions Screening?
Sanctions screening is the process of comparing the name of an individual or organisation with the sanctions records the institution must take into account given its activities and obligations. Sources may vary according to the applicable law and the business relationship. Examples include the lists of MASAK, the US Treasury’s OFAC, the United Nations and the European Union.
Official asset freezing decisions are also among the sources that need to be monitored. MASAK’s compliance programme regulation requires financial institutions within its scope to establish enhanced controls against the risks of breaching, failing to implement or evading asset freezing decisions taken under Laws No. 6415 and 7262. Institutions should therefore incorporate the official decisions and sources applicable to their own obligations into their processes. MASAK’s Compliance Programme Regulation and Law No. 7262 can be reviewed in this context.
What Is PEP Screening?
PEP stands for “politically exposed person” and refers to individuals who hold or have held a prominent public function. FATF states clearly that additional measures for PEPs are preventive in nature and that PEP status does not mean the person has committed a crime. Under the FATF approach, the family members and close associates of PEPs are also taken into account where applicable. National legislation and the institution’s risk policy determine how this scope is applied. For details: FATF’s PEP Guidance.
This is why a “PEP match” and a “sanctions match” are not the same result. PEP information helps deepen customer due diligence and risk assessment; on its own, it is not evidence that the person has committed a crime or is prohibited from transacting.
What Does Corporate Relationship Analysis Show?
Corporate relationship analysis examines individuals and organisations not as isolated records but together with the connections between them. Using records such as shareholding, management, representation and company history, it makes the type, source and change over time of each connection visible.
In Turkey, the Trade Registry Gazette is an important source on company events such as incorporation, shareholding, capital, management and address changes. Structuring these records makes it easier to research the past connections of individuals and companies. FATF’s beneficial ownership guidance emphasises the importance of adequate, accurate and up-to-date information for identifying the beneficial owners behind complex corporate structures.
Relationship analysis can support research into questions such as:
- Who are a company’s shareholders and executives?
- In which companies has a person held a shareholding or management role?
- Through which records can the beneficial owner be reached along the ownership chain?
- How has a company’s structure changed over time?
- Which other corporate records is the same person or company associated with?
How Does Relationship Analysis Cover Screening’s Blind Spot?
A company may not appear on a sanctions list under its own name. Even so, its shareholding structure, management or other corporate connections may point to individuals and organisations that warrant closer review. Here, screening and relationship analysis play different roles:
- Identify the customer and related parties. Collect identity information for the customer, beneficial owner, representatives or other related parties in line with the institution’s regulations and risk policy.
- Screen against applicable sources. Ensure potential sanctions and PEP matches are verified with source, date and distinguishing information.
- Examine company connections. Assess the shareholding and management structure together with the records it is based on.
- Screen newly identified records where necessary. Individuals and organisations identified through relationship analysis should be checked separately against the relevant sources, in line with applicable obligations and institutional policy.
- Record the decision with its rationale. A match or connection should not on its own replace a decision; the review outcome, the source used and the action taken should be traceable.
Datactive Sanctions & PEP Screening and DataSentinel
According to the product information published by the company, Datateam’s Datactive Sanctions & PEP Screening offers screening against the sanctions lists of more than 100 countries including MASAK, OFAC, the UN, the EU and other sources; instant alerts for asset freezing decisions in the Official Gazette; screening of Turkey’s PEP list and associated circles; a near real-time data feed; delta and bulk screening; advanced search and filtering; and unlimited querying. Explore the Datactive Sanctions & PEP Screening product page.
DataSentinel processes Trade Registry Gazette data published across Turkey to support the review of corporate connections, shareholding structures and company history between individuals and companies. This allows compliance, risk and investigation teams to assess connected records more holistically. Explore the DataSentinel product page.
Frequently Asked Questions
Are sanctions screening and PEP screening the same thing?
No. Sanctions screening checks whether an individual or organisation appears in applicable sanctions records. PEP screening, on the other hand, supports risk-based review by identifying politically exposed persons and, where applicable, their close circles.
Does being a PEP mean being a criminal or being under sanctions?
No. FATF states that additional measures for PEPs are preventive and that PEP status does not imply criminality. The final assessment should be made with current, verified information.
Does relationship analysis replace sanctions screening?
No. Relationship analysis shows the connections between individuals and companies; sanctions screening compares these records against applicable lists and official decisions. The output of one does not replace the other.
Is sanctions screening alone enough to identify beneficial owners?
No. Screening looks up records on lists about a specific individual or company. Identifying beneficial ownership requires examining the company’s ownership and control structure through current and verifiable records.
Which Datateam products meet these two needs in Turkey?
Datactive Sanctions & PEP Screening supports sanctions and PEP screening. DataSentinel makes corporate relationships between individuals and companies visible using Trade Registry Gazette data. How the two products are used in the same workflow is planned according to the institution’s processes and the scope of integration.
Sources
- MASAK — Law No. 5549 on the Prevention of Laundering Proceeds of Crime
- MASAK — Obliged Parties
- MASAK — Regulation on the Compliance Programme
- MASAK — Law No. 7262
- FATF — Politically Exposed Persons Guidance
- FATF — Beneficial Ownership of Legal Persons Guidance
- Datactive Sanctions & PEP Screening
- DataSentinel
This content has been prepared for general information purposes. The obligations and sanctions decisions applicable to your institution should be assessed against current legislation by authorised legal/compliance teams.