Efforts to implement sanctions regimes are often hampered by the slow, difficult, and sometimes non-existent exchange of information between countries which targeted individuals and entities can take advantage of to evade sanctions. However, in the context of sanctions based on serious offences, such as modern slavery and human trafficking, implementation can be more effective and efficient using existing networks and processes managed by Financial Intelligence Units (FIUs).
This UNU-CPR discussion paper demonstrates how leveraging the expertise, experience, and networks of FIUs is critical to the fight against these crimes, and outlines several policy-relevant findings that can help to inform policies and strategies to address them:
- When a person, company, or group has been sanctioned for serious criminal activity – and this activity is considered a predicate offence to money laundering – an Anti-Money Laundering framework can be initiated with FIUs playing a leading role.
- Since common sanctions evasion techniques, such as the use of shell companies, family members, and intermediaries, are similar to money laundering techniques, an FIU is well suited to analyse information pertaining to acts of sanction evasion.
- The interconnection of FIUs through the Egmont Group provides a secure way of exchanging information on money laundering-related cases; an alternative information exchange platform for purely sanctions related cases does not exist – which is a challenge since sanctioned individuals and entities often take advantage of the slow or non-existent exchange of information between countries.
- Once FIUs have analysed the AML-relevant sanctions case, they can share an intelligence package with national sanctions implementing authority; FIUs have mechanisms in place which enable them to cooperate and exchange information domestically with other relevant stakeholders under the AML framework.
Download 'How Financial Intelligence Units Can Support the More Effective Implementation of Sanctions Regimes' here.
Suggested citation: Haberstroh Frank, Simon Zaugg. How Financial Intelligence Units Can Support the More Effective Implementation of Sanctions Regimes : UNU-CPR, 2023.