ATLANTA —LexisNexis® Risk Solutions released the findings from a special edition of its Sanctions Pulse infographic focused on the sanctions that have emerged because of the Russia conflict against Ukraine. LexisNexis Risk Solutions analyzed sanctions data from core issuing regulators, the European Union (EU), Office of Foreign Assets Control (OFAC) and Office of Financial Sanctions Implementation (OFSI, UK), to measure how significantly the sanctions landscape has changed through increased global sanctions on Russian entities, as well as current and future implications for compliance professionals.
Unprecedented sanctions activity over the past few months in response to the ongoing situation in Ukraine has spurred regulators to apply new sanctions and update and expand pre-existing regulations. It is the speed and scale of activity that shows no sign of ending anytime soon that constitutes a challenge for compliance professionals. With data analyzed from February 21, 2022, to March 31, 2022, there were 40 total updates to the EU, OFAC and OFSI lists, with a +2,388-net count of added designations relating to Russia alone, compared to 150 net designation additions for all sanctions programs over the same period last year.
The findings show that regulators issued significant list updates across the six-week period, many concentrated towards the beginning of the conflict and sometimes several times in one day. This has had considerable implications for compliance professionals facing a combined challenge of scale, speed and complexity as they contend with a higher stack of alerts, additional pressures on the sanction list update processes and burdensome alert remediations.
Sanctions trends observed over the past several years accelerated in a matter of weeks in response to the situation in Ukraine. The United States, EU and United Kingdom led a common front, followed by countries like Canada, Australia and New Zealand. Many European countries aligned with the EU including Ukraine, Georgia, Switzerland, Norway, Iceland and the Balkan states, excluding Serbia. This activity extends beyond the West, with Japan, South Korea and Singapore implementing similar sanctions.
“No one can predict how the sanctions landscape will evolve in the coming months, but the scope of regulator activity concerning the situation in Ukraine has already made for a perfect sanctions storm, deploying virtually all typologies of sanctions to restrict dealings with certain individuals, companies, aircraft, ships, items or locations,” said Vincent Gaudel, financial crime compliance expert, LexisNexis Risk Solutions. “While governments are imposing these sanctions and restrictions to fulfill certain foreign policy objectives, the onus is on private companies to abide by them, resulting in massive compliance challenges which are unlikely to disappear anytime soon. The impact of this European conflict is global and will have an ongoing effect on global trade and economics, with supply chains and international relations experiencing disruption in the longer term.”
View the infographic that details how the sanctions landscape has evolved between February 21, 2022, to March 31, 2022 here.
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