Top Tips for Sanctions Compliance and Preventing Sanctions Evasion

Why Sanctions Compliance Matters

Sanctions are essential tools for promoting national security, preventing the proliferation of weapons of mass destruction, and protecting human rights. By restricting trade and financial transactions, sanctions can help to isolate rogue states and non-state actors, deter illicit activities, and promote desired policy changes.

Violating sanctions can have serious consequences, including fines, imprisonment, and reputational damage. In today's interconnected global economy, it is more important than ever for businesses to understand their sanctions obligations and to take steps to prevent sanctions evasion.

Key Tips for Sanctions Compliance

There are a number of key tips that businesses can follow to ensure their sanctions compliance. These include:

• Conducting due diligence on customers, suppliers, and other third parties
• Screening transactions against sanctions lists
• Implementing internal controls to prevent sanctions violations
• Providing training to employees on sanctions compliance
• Working with a sanctions compliance expert

Conducting Due Diligence

Due diligence is the process of investigating a potential customer, supplier, or other third party to assess their risk of being involved in sanctions violations. Due diligence should include a review of the party's public records, financial statements, and other relevant information.

By conducting due diligence, businesses can help to identify and mitigate the risks of doing business with parties that may be involved in sanctions violations.

Screening Transactions

Screening transactions against sanctions lists is an essential part of sanctions compliance. Sanctions lists are maintained by governments and international organizations, and they identify individuals, entities, and countries that are subject to sanctions.

Businesses should screen all transactions against sanctions lists to ensure that they are not doing business with sanctioned parties. Screening can be done manually or through the use of automated software.

Implementing Internal Controls

Internal controls are policies and procedures that businesses can implement to help prevent sanctions violations. These controls should include measures to:

• Screen transactions against sanctions lists
• Conduct due diligence on customers, suppliers, and other third parties
• Train employees on sanctions compliance

Providing Training

Training is an essential part of sanctions compliance. Businesses should provide training to all employees who are involved in transactions that may be subject to sanctions. Training should cover the basics of sanctions compliance, including the types of sanctions, the parties that are subject to sanctions, and the penalties for violating sanctions.

Working with a Sanctions Compliance Expert

Sanctions compliance can be a complex and challenging area. Businesses that are unsure about their sanctions obligations should consider working with a sanctions compliance expert. Sanctions compliance experts can help businesses to:

• Develop and implement sanctions compliance programs
• Conduct due diligence on customers, suppliers, and other third parties
• Screen transactions against sanctions lists
• Provide training to employees on sanctions compliance