In a recent article, Guidehouse noted the evolving landscape of the UK’s Sanctions Regime, with its increasing autonomy and divergence from the EU in a post-Brexit era. On 26 April 2021, under the Sanctions and Anti-Money Laundering Act 2018, the Foreign, Commonwealth & Development Office (FCDO) and the Office of Financial Sanctions Implementation (OFSI) introduced The Global Anti-Corruption Sanctions Regime 2021. This replaced the Misappropriation (Sanctions) (EU Exit) Regulations 2020.
The purpose of the regulation is to prevent and combat serious corruption, allowing the UK Secretary of State for Foreign, Commonwealth, and Development Affairs to impose financial sanctions and travel bans on persons involved in bribery or the misappropriation of property. Furthermore, the Regulations stipulate that it is a criminal offence to contravene the financial sanctions prohibitions or to seek to circumvent the prohibitions. The first wave of designations under the regulations identified 22 individuals involved in corruption cases in Russia, South Africa, South Sudan, and Latin America who have now been added to the UK Sanctions List.
The introduction of The Global Anti-Corruption Sanctions Regime 2021 illustrates the continued global effort to address the challenges and the prevention of serious corruption. A statement released by the US Department of the Treasury commends the new regulation, which provides the UK similar authority to that of the US Magnitsky Act program. The US stands in partnership with the UK and The Global Anti-Corruption Sanctions Regime 2021, and reinforces the fight against corruption and illicit finance targets, human rights abusers, and corrupt actors.
What Does This Mean for Financial Institutions?
With the introduction of The Global Anti-Corruption Sanctions 2021, all obliged entities must review the regulations and guidance provided by the FCDO and OFSI to comply with the new requirements. Financial institutions should keep apprised of any changes to the UK sanctions regime and ensure that these are reflected within their policies, procedures, and systems updates.
How Can Guidehouse Help?
Guidehouse can rapidly review changes to the UK sanctions regime and assess your financial crime framework to determine whether it is operationally effective and meets the new regulatory expectations. Guidehouse can identify financial crime framework gaps and advise on optimal solutions to any weaknesses identified.
Our team has in-depth knowledge of the regulatory environment in the UK, Europe, and globally, and best practices operated by financial institutions. Our relevant expertise includes:
Financial crime framework and sanctions risk assessments and gap analyses
Transaction and customer due diligence reviews
Advising on the effectiveness and efficiency of financial crime processes and systems
Compliance system testing and reviews; and general and job-specific sanctions training
Guidehouse’s financial crime consultants work with financial institutions of all sizes to build effective and efficient risk management and compliance frameworks to help clients protect against legal, fiduciary, shareholder, and reputational risk. Guidehouse experts include distinguished former prosecutors, regulators, compliance officers, and consultants, who leverage their combined experience to help clients conquer their compliance challenges.
Special thanks to Sajeev Kanagarajah for contributing to this article.