Anti-Terrorist Financing Screening
Anti-terrorist financing screening (ATFS) represents the essential baseline safeguard for all cross-border grantmaking. In an interconnected world where terrorist networks exploit the same financial systems used by legitimate charitable organizations, every international grant carries inherent risks of fund diversion, regulatory violations, and reputational damage. The global reach of terrorism financing, driven by increasingly sophisticated methods spanning multiple jurisdictions, misuse of nonprofit structures, and abuse of conventional banking systems, makes comprehensive screening a critical first line of defense for grantmakers worldwide.
Whether a foundation operates from the United States, Europe, Australia, or any other jurisdiction, screening against sanctions and terrorism lists is a standard control reflected in guidance issued by bodies such as the Financial Action Task Force (FATF), helps prevent violations that could lead to severe penalties under national sanctions regimes, and preserves the integrity essential to effective philanthropy. ATF screening thus forms the cornerstone of responsible international grantmaking, enabling organizations to pursue their charitable missions confidently while reducing the risk that philanthropic resources reach terrorist networks that continuously adapt and evolve across global regions through increasingly complex financial channels.
ATFS Service
ATFS is Paragon’s baseline anti-terrorist financing screening service, and Tier 1 within the Four-Tier Framework. ATFS provides global grantmakers with a trusted first line of defense against the diversion of charitable funds. Designed for an international audience, ATFS combines rigorous sanctions and watchlist screening with identity verification and review of the registration and identity documents the organization provides, covering the entity, its leadership and controlling entities, and its declared financial institutions. Our process aligns with global standards set by the Financial Action Task Force (FATF) and integrates official lists from OFAC, the United Nations, the European Union, the United Kingdom, and other major international authorities.
Where indicators such as higher-risk geographies, government ownership or control, multi-jurisdictional operations, or other material risk factors are present, Paragon’s Higher Risk Anti-Terrorist Financing Screening service (ATFS-HR) is the tier designed to address them; whether to apply it is the client’s determination. Jurisdictions with elevated corruption levels and weaker anti-money-laundering (AML) controls present increased exposure to diversion of funds, including potential misuse by terrorist entities. For corruption risk, Transparency International’s Corruption Perceptions Index (CPI) provides country-level scores, while the Basel AML Index offers a globally recognized composite rating for money-laundering and terrorist-financing risk. Where a grantee operates in countries ranking poorly on either index, that condition is recorded in the ATFS Report as an escalation consideration; the decision whether to escalate to ATFS-HR rests with the client.
Information Collection
ATFS is an analyst-led service in which Paragon engages directly with the grantee organization to obtain the required information and documentation, while also reviewing relevant public sources where available for completeness. Paragon records the organization’s disclosures regarding its legal and alternate names, addresses, and registration; reported countries of activity; leadership, founders, board members, controlling or affiliated entities; and declared financial institutions. It also captures information on ownership and governance, and any government or political affiliations. These inputs, certified as accurate by the organization and supported by registration certificates and other documentation, form the evidentiary basis for sanctions and watchlist screening across all relevant jurisdictions.
ATFS Screening Steps
ATFS screening is a structured process used to establish organizational identity, evaluate sanctions and watchlist exposure, and compile the evidentiary record supporting responsible cross-border due diligence. It includes the following steps:
1. Identification and Source Verification
- Obtain the organization’s legal and alternate names (in English and, where applicable, the language of origin), acronyms, and all known addresses in countries of operation or registration.
- Review the organization’s website and publicly available sources to identify any additional alternate names, acronyms, or addresses for screening.
- Secure official registration and identity documents confirming current legal status (e.g., certificate of registration, charter, or equivalent).
- Obtain a certified list of board members, founders, persons with operational authority, beneficial owners, controlling entities and controlling individuals, affiliated organizations, declared financial institutions, and locations of operation; affiliated organizations are recorded as disclosures and are not screened.
- Obtain supporting documentation where the organization holds it, forming the evidentiary basis for sanctions and watchlist screening.
2. Sanctions and Watchlist Screening
- Global Watchlist Screening: Screen all collected names and entities, including the organization and its alternate names, its persons with operational authority, governing body members, founders, beneficial owners, controlling individuals, disclosed controlling entities, and disclosed financial institutions and routing banks, against the global sanctions and terrorism-related watchlists available through the CSI WatchDOG Elite platform at the time of screening, including, at a minimum:
- U.S. Office of Foreign Assets Control (OFAC) SDN and SSI lists
- OFAC-related lists (FSE, CAPTA, NS-MBS, NS-CMIC, Non-SDN PLC, and the Department of State Cuba Restricted List)
- European Union sanctions
- United Nations Consolidated Sanctions List
- UK HM Treasury sanctions
- U.S. Terrorist Exclusion List
- Federal Bureau of Investigation (FBI) and Interpol lists
- FinCEN Section 311 special measures
- Follow-Up and Match Resolution: Conduct follow-up analysis on all potential matches, contacting the organization as needed to confirm or resolve positive hits and to ensure accurate screening results.
3. Documentation
- Confirm that the organization’s registration and identity documents are current and consistent with the names screened.
- Record all match resolutions and supporting evidence in the screening file, creating an auditable record of analyst actions and findings.
- Where additional clarification is required, obtain secondary information directly from the organization to verify accuracy and resolve potential discrepancies.
Deliverable: ATFS Report
Paragon provides the client with a written Anti-Terrorist Financing Screening (ATFS) Report documenting the results of watchlist screening against applicable global sanctions and terrorism-related lists, including OFAC, UN, EU, UK HM Treasury, FBI, Interpol, and U.S. Terrorist Exclusion lists, together with FinCEN Section 311 special measures, and whether any OFAC country-based sanctions programs are associated with the organization’s reported countries of activity. Where country-based sanctions programs are identified, the report notes applicable OFAC general licenses for the client’s review.
The report includes an executive snapshot of key findings, a structured watchlist screening table with match-resolution determinations, and documentation of the organization’s reported countries of activity, control relationships, and beneficial ownership.
Each ATFS Report also includes a structured Escalation Considerations section that consolidates risk indicators identified during the Tier 1 review to support the client’s decision about whether Higher-Risk Anti-Terrorist Financing Screening (ATFS-HR, Tier 2) is appropriate. Jurisdictional risk indicators, including OFAC sanctions program exposure, FATF grey/black list status, documented terrorist group operational presence, and Basel AML Index and Corruption Perceptions Index scores, are recorded for the client’s review as published at the time of the review. Grant structure and relationship considerations, including unusually large or complex grants, regranting or sub-award arrangements, and first-time grantee relationships, are flagged for the client’s own evaluation.
This deliverable establishes a verifiable, auditable record of screening and match resolution, supporting the client’s sanctions compliance documentation and broader risk-based due diligence file.
ATFS Within Paragon’s Four-Tier Framework
ATFS forms Tier 1 of Paragon’s Four-Tier Framework, which provides a scalable and risk-proportionate model for cross-border grantmaking. The framework enables funders to apply due diligence that matches the level of risk identified during review. Tier 1 establishes the baseline through sanctions and terrorism screening of the grantee, the individuals and entities it disclosed for screening, and its declared banks. When elevated risk factors such as higher-risk geographies, complex ownership, or inconsistent disclosures are identified, funders may escalate to Tier 2 (Higher-Risk Anti-Terrorist Financing Screening) for additional national-level sanctions and terrorism-focused adverse-media checks. Tier 3 (Integrity Review) expands to include governance, corruption, and reputational risks, while Tier 4 (Integrity Due Diligence) applies registry-verified ownership, litigation, and enforcement checks for complex or high-risk cases. This tiered approach provides a clear structure for right-sizing due diligence across diverse portfolios. It supports consistency, efficiency, and alignment with FATF, OFAC, IRS, and comparable global standards.
View this service within the Four-Tier Framework ›
Paragon’s risk-based due diligence framework helps funders align vetting depth with risk.
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When Baseline Screening Isn’t Enough ›
Understanding the escalation indicators recorded in every ATFS report and when higher-risk screening is warranted.
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Selected Clients
The Rockefeller Foundation
Greater Houston Community Foundation
Chicago Community Trust
Zoetis Foundation
Greater Kansas City Community Foundation
Marin Community Foundation
Douglas B. Marshall, Jr. Family Foundation
Rodan + Fields Prescription for Change Foundation
Whittier Trust
Communities Foundation of Texas