Sanctions: Brainteasers With Serious Consequences

By: Davina Given*

Failure to comply with financial sanctions carries serious penalties, most notably in the US, where banks have collectively paid billions of dollars in fines.  Even in the UK, a failure to comply with sanctions carries the potential for unlimited criminal and regulatory fines and/or imprisonment.  Yet financial sanctions are often difficult for most businesses to grapple with, particularly if they do not have the resources of the very largest businesses.  Political imperatives may lead to the imposition of financial sanctions in respect of existing, longstanding business.  Individual targets may change quickly and abruptly, with little fanfare.  Different countries involved in a transaction may apply slightly different financial sanctions, so that the transaction may be legal in one country but illegal in another.  Yet on top of those issues, there is a further legal difficulty: what does any particular financial sanction actually prevent? (more…)

UK ‘Brexit’ shocks the world and creates an uncertain future for European sanctions implementation

By: Anna Sayre, reporter SanctionsAlert.com 
Date: June 30, 2016

On June 23rd 2016, after 40 years of membership, the UK has voted to no longer be a member of the European Union. A 52% majority of the British population have cast a “Leave” vote, creating a momentous decision in British history that will make an indelible mark in the financial landscape of the world for years to come. The vote by the UK to leave the EU, or ‘Brexit’, has already created mounting uncertainty within the UK financial market, caused the British pound to plummet, and made big banks and other financial institutions consider a permanent move from London to much less volatile offices in Frankfurt or Dublin. (more…)

UK officially launches the Office of Financial Sanctions Implementation: the implications of Britain’s new sanctions watchdog

Date: April 5, 2016

After earlier referenced in the Summer Budget 2015, on March 31, 2016, the UK has launched the new Office of Financial Sanctions Implementation (or OFSI). This agency will replace the Asset Freezing Unit of HM Treasury, which originally took over from the Financial Sanctions Unit of the Bank of England in October 2007. The former was created in order to specifically combat terrorist financing. The new OFSI, however, is expected to have a broader scope. Although no formal mandate has been laid out for OFSI to date, it is expected to have a dual function of awareness-raising around sanctions, as well as facilitating enforcement. In the Summer Budget, the role of OFSI was described as “working closely with law enforcement” to ensure sanctions were “properly enforced”. In a statement by the UK Chancellor, George Osborne, OFSI will raise “awareness and [provide] clear guidance to promote compliance with financial sanctions… and [work] closely with other parts of government to ensure that sanctions breaches are rapidly detected and effectively addressed.” (more…)