The events in Ukraine and the economic sanctions imposed on Russia raise a number of broader issues that financial services firms will need to consider, above and beyond the immediate concerns and challenges arising from the imposition of sanctions on clients and counterparties and heightened market volatility.
These include broader questions around governance, financial crime compliance and systems and controls, as well as the approach that firms want to take to manage their reputational risk and their regulatory position. Our global financial services team has broad experience supporting clients to navigate these complex issues from both a legal and compliance perspective.
FCA review of Sanctions systems and controls
On 6 September 2023, the UK Financial Conduct Authority (the FCA) published the findings of its review of the sanctions systems and controls in place at over 90 financial services firms operating in a range of sectors (the Review).
Individual accountability for directors of non-UK entities under the UK’s Russian sanctions regime
In addition to the obligations on regulated firms to comply with applicable sanctions regimes, individuals also need to be aware of their own compliance with sanctions restrictions. From a territorial...
UK sanctions: the ban on providing professional and business services to persons “connected with Russia”
On 4 May 2022, the UK Government announced a ban on services exports to Russia, and as at 21 July 2022 that ban is now in force by virtue of regulation 54C of The Russia (Sanctions) (EU Exit) Regulations 2019 (as amended by The Russia (Sanctions) (EU Exit) (Amendment) (No. 14) Regulations 2022) (the Regulations).
The Economic Crime (Transparency and Enforcement) Act 2022
The Economic Crime (Transparency and Enforcement) Act 2022 (the Act), which came into force in March 2022, aimed amongst other things, to give UK sanctions authorities greater power to take enforcement action and impose penalties on persons that breach sanctions restrictions, through the introduction of a “strict liability” test.
Recent developments signal a rise in sanctions enforcement risk for UK regulated firms
Whilst historically there have been relatively low levels of sanctions enforcement in the UK, in light of recent developments, in the coming months we expect to see more scrutiny in this area and increased enforcement activity in relation to sanctions breaches.
Anti-money laundering: Regulation Around the World
A number of enforcement actions taken by regulators around the world have been a reminder for financial institutions that board involvement in, and appropriate oversight of, anti-money laundering/countering the financing of terrorism (AML/CFT) compliance programmes is critical.
Financial Services Academy: Sanctions
We are pleased to invite you to the next session of our Financial Services Academy, a series of online webinars aimed at up-and-coming in-house regulatory lawyers and compliance professionals who are not directly involved in sanctions related matters on a day-to-day basis, but who want to understand the sanctions regulatory framework.
Governance lessons learned: Experience from implementation of Russian sanctions
UK regulated firms seeking to comply with the Russian sanctions have had to grapple with fast moving legislative and regulatory change, and have inevitably encountered governance challenges along the way.
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