Two years ago, at the AML and Financial crimes Congress Gavin Coles from Kasker Consulting warned attendees at the AML & Financial Crimes Congress 2020 that there might be major geopolitical shifts that could change the flavour of sanctions risks.
The 2020 session ended with Coles predicting major geopolitical shifts to come.
Those expecting the BAU for global supply chains started to open form the lockdowns were in for a rude awakening with the Russian invasion.
“The real catalyst that we’ve all been aware of or been seeing the news on is the invasion of Ukraine by Russia in February,” Coles said.
He said that some had predicted that the invasion and corresponding sanctions would happen back in 2014 when the Russia invaded and then annexed the Crimean Peninsula.
Sanctions in 2022
What is notable about this raft of evolving sanctions in the international community’s rapid response. It is this speed and the continuous developments in sanctions that business should be paying close attention to.
“The first sanctions response that we saw on the 25 February in Australia, which was very proactive, positive I think, the activation date or the implementation date the 25 March, so if you have prepared at all, you had a month to get everything sorted out, and that real challenge for some origination when you have a thousand things to do every day.”
The Ever-Changing Environment
For Australian entities it is about maintaining a good dialogue between the Australian Transaction Reports and Analysis Centre (Austrac) and making the sure that one has a Department of Foreign Affairs and Trade (DFAT) PAX account in order to stay up to date with the changes in sanctions.
“I think what the situation with Russia and the Russian sanctions have really underlined is this importance of understanding that beneficial ownership chain. “We know that some of the individuals targeted, some of the oligarchs have set up very, very complexed ownership structures across the world. And its very easy to be fooled by some of those ownership structures up the beneficial ownership chain.”
Screening the of transactions is normal for Australian financial services, but there might be for products and business outside the financial sector.
More on sanctions in an upcoming podcast with LexisNexis.
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